Saturday, December 31, 2011

Aligning Strategy

Without a doubt the most stressful in any organization is  "Strategy Time" - the annual strategy process that culminates in a key presentation to the CEO and/or board of directors. The idea is to define the overall organizational strategy for the next year - where to place the bets, what markers to go after, etc.

There are many reasons why this process is so stressful, but primarily the goals of the process are misunderstood;  too many people focus on unveiling the smartest/best/most clever strategy.  The mistake here is that strategy must be presented with organizational alignment to be successful, and stakeholders must be brought along on the journey.

Good strategists understand that they must bring the organization along on the strategy journey and determine all the stakeholders needed - they go into the final meeting with everyone in alignment, ready to move to the execution phase.  In many cases you'll need to be an amateur psychologist as you 'herd the cats'.  As an example, you'll need to include elements of competing strategies to align certain stakeholders - good strategists are pragmatic and know which elements matter, and which to let go.

Although I hate to use the term, this can be mapped to "politics" and also to our basic human needs to interact at a social level. For politics, remember that there are good and bad politics (although the definition may change at the hands of who wields the influence), and they are a part of every organization.  I like the Wikipedia definition:

Politics (from Greek πολιτικός, "of, for, or relating to citizens") is a process by which groups of people make collective decisions. The term is generally applied to the art or science of running governmental or state affairs, including behavior within civil governments, but also applies to institutions, fields, and special interest groups such as the corporateacademic, and religious segments of society. It consists of "social relations involving authority or power"[1] and refers to the regulation of public affairs within a political unit,[2] and to the methods and tactics used to formulate and applypolicy.[3]

When the CEO receives the presentation they'll monitor the body language of the other attendees and immediately know the degree of alignment.  Disagreements and arguments in the presentation will lead the CEO to see the strategy as "half-baked", or the presenter as lacking preparation or leadership.  Behind the scenes the CEO will also reach out to key stakeholders behind the scenes and ask for their opinions  e.g. key technical staff often have a say in many software companies. And in many cases the CEO keeps their observations and conclusions private.

If you read this, roll your eyes, and think that this is a bureaucratic process only needed in large organizations - you'd be wrong.  All organizations, big or small, agile or waterfall, have to be aligned to move forward towards a goal.  Failure to align leads to implementation failures and missteps.

Similarly, when organizations are dictated a top-down strategy they often reject it if certain elements don't make sense or feel a lack of disempowerment.  So an tops-down strategy goes through a similar (inverted) process of alignment or eventual rejection. In Steve Job's  recent biography the claim is made that his reports often ignored his directions if they felt it didn't make sense.  I call this the "passive/agressive" organization where everyone nods in agreement, but as soon as the meeting ends they ignore the strategy and follow their own directions.

The worst outcome is an organization without alignment - nothing is more poisonous or counter productive.  I've seen the outcome here in both startups and big companies, and it's always ugly - you end up back at step one trying to find a strategy  where alignment can be achieved.

The bottom line is that any technology company is a social organization and successful organizations are aligned and work together on a single, well understood strategy.  The process to get to this point is often difficult and time consuming, but the outcome is well worthwhile.

Never present something important (like organizational strategy) unless you've put in the hard work to align the stakeholders and know the outcome.

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