Upgrade Your Strategy

There are four kinds of companies in the world:

1. Companies that are in trouble. They know they need to change. The question is what to do.

2. Startups. They know they need to do new activities. The question is how to reduce risk and make sure you are spending in the right areas.

3. Successful companies. Ironically, successful companies are the ones that are easiest to change. Generally because they have succeeded by changing in the past.

4. Successful companies with a train coming down the tracks towards them. The most difficult companies to help are those where one or two "voices in the wilderness" are warning about threats and the company management team is too comfortable relishing their success and is unwilling to make changes to anticipate change. In these companies, crisis rather than planning will create change. Unfortunately, by the time crisis is reached, it is often too late. At the minimum it is painful for the fired employees, the "collateral damage" from failure to plan.

Trying to figure you way out of these situations is often challenging. An outside facilitator can often help. There are three reasons why the outside facilitator is so useful.

1. The outside facilitator is neutral and has no axe to grind.

2. The experienced outside facilitator will have seen the same patterns of errors in other management teams and can comment and challenge the conventional wisdom within the firm.

3. There is a needed process for creating change within an organization. Kicking off the process needs commitment and consensus. Facilitation involves in decision making those who must implement. Commitment in front of your colleagues means putting your reputation on the line to support change.

A good strategic facilitator can have dramatic impact in as little as one 1-day meeting. But even better results are typically obtained with a series of meetings separated by time to implement the changes and continue running the business.. Facilitation meetings should typically be no longer than 1-2-days.

What the techniques used in facilitation?

The key techniques used in facilitation revolve around helping the management team to agree on goals, assess the future environment, brainstorm strategies, prioritize strategies based upon either agreement on the future or scenarios about the future and have the management team commit to execution and results.

Often, the facilitator must provide frameworks for structuring the discussion. A great facilitator can alter the perception of the management team with one graphic, one chart or one analytical framework.

Modeling

Traditionally, facilitation has been a pretty low tech approach to changing the view of the management team. However, today a new approach to supporting the change process is available - modeling.

An example: we recently did some work with a company selling a product that took several years to manufacture. The product could be produced in multiple countries and multiple locations within those countries.

The company was unable to link its product forecasts with its marketing forecasts with its distribution channel information with its customer purchase data with its customer consumption data.

An integrated view of their business that allowed them to model their entire value chain and the value chains of their suppliers, channels and customers could alter the way they measure themselves against their opportunities and the competition.

These kinds of integrated enteprise models can become the new "filters" with which the organization sees the world. They can also be used for performance monitoring, budgeting and control.

Scenario Analysis

In an uncertain world, a typical problem is not knowing how the future will turn out. War in the Middle East. 9/11. SARS. Major drop in the value of the American dollar. Banking crisis in China. Trade wars. Uncertainty has never seemed so high.

One way out of the problem is use scenario analysis. In brief, scenario analysis paints a word picture of several possible futures based upon identifying the key drivers of the future that affect the business.

When strategic alternatives are created, proposed strategies are evaluated across the scenarios. Some strategies do better across all scenarios than others. Other strategies do worse. By explicitly addressing future uncertainty, better decisions emerge.

Next Steps

If you would like to discuss upgrading your strategy, involving your management team in committing to improve performance, scenario analysis or the construction of an enterprise model, please contact us: