It doesn’t have to be frustrating
Writers in a recent issue of the highly regarded McKinsey Quarterly discuss study findings that surfaced the routine frustration and disappointment experienced by too many organizations undertaking a strategic planning process.
KGI has observed similar scepticism from prospective clients - ‘We’re not interested if this is another time-consuming planning process that leaves nothing but more work that diverts us from doing our job.”
Such a response signals dissatisfaction both with their existing process and the lack of appropriate impact on the organization.
The authors identify five key improvements to address specific frustrations as well as practices from industry to prove their point, making their article even more helpful to its audience.
The KGI Accountability Framework® System (AFS) already provides such improvements.
Start with the issues
The AFS begins with a future outlook or Vision and then names the four or five key issues or Success Factors that must be addressed to reach that vision.
This gets quickly to the heart of the matter and keeps the focus on the most important topics, successfully avoiding costly diversions – ‘Does this effect one our Success Factors?’ If so, how? If not, it’s off the table.
Bring the right people together
The AFS must be championed by key leaders – corporate development executives and planners typically discover KGI and then champion it so the AFS is embraced by the CEO for maximum effectiveness. Planning with the implementers at the table ensures the AFS has a long term effect in the organization and the depth of its impact.
Adapt planning cycles to the needs of each business
For many it feels like there is constant planning without time for execution and evaluation. The authors of the McKinsey report suggest using a longer planning cycle and in some cases having the review happen every two or three years for some units will address this.
The AFS Framework is developed quickly but also for the long term. Many of our clients work with a Framework that was developed as many as 6 to 8 years ago. If the Vision doesn’t change, the Framework seldom changes. The Success Factors may be modified to recognize significant environmental changes but also meet the test of time.
The detailed review, measurement and course correction takes place at the Action Plan level of the system which plans for the next three years with annual updating. With metrics built into the Action Plan, leadership will be collecting the right data for the right objectives keeping the annual review focussed on maintaining alignment with the Vision.
Implement a strategic-measurement system
If there isn’t an appropriate performance management system companies often fail to execute on strategy.
While financial measurement and other metrics are revealing, having everyone in the company aligned to the strategy through the KGI Role Map® process also informs our Individual Contribution Assessment (ICA) performance management system. The ICA measures both what employees accomplish and how they accomplish it.
At the outset of the strategic planning process the company leadership not only named a vision and defined Success Factors, they also named and defined the specific values-based behaviours. These are the behaviours expected by the leadership of all employees throughout the company. The ICA performance management system asks each employee and supervisor to assess their success in meeting specific and well defined objectives. The added feature that makes the AFS particularly useful is to evaluate employees on how well they demonstrated their commitment to the Values of the company.
Integrate human-resources into the strategic plan
The McKinsey article wisely states that successful implementation depends on how managers (KGI would say all staff) are evaluated and compensated, linking these with specific initiatives.
In the KGI performance management system employees identify two or three key objectives for the coming year that are appropriate for their role and move the strategy forward toward the clearly understood Vision.
This means that the human resources function also reinforces the Vision of the organization and on a daily basis.
If planning is managed with these five issues in mind along with the KGI Accountability Framework more effort and energy is focused on implementing the strategy, making the process an effective use of company resources – time and money.