How to Achieve Execution Excellence

Balanced Scorecard

What’s the best way to drive individual performance?

How does a leader assure enterprise success?

Is it possible to close performance gaps to improve execution?

 

Making Strategy Work

In Execution Excellence: Making Strategy Work Using the Balanced Scorecard  Sanjiv Anand answers these and other questions.

Sanjiv Anand has 30 years of global experience in consulting, helping CEOs and boards develop transformational strategies. Currently the Chairman of Cedar Management Consulting International, his book is full of his operational and strategic insight on how to manage human capital. He is an expert on the Balanced Scorecard.

I recently asked Sanjiv to share some of his experience about what does and doesn’t work in implementing strategy.

 

“If you can’t execute the strategy, it’s not worth having.” –Sanjiv Anand

 

Why is strategy more relevant than ever before?

While the world continues to provide opportunities to grow, it is not without challenges. First, customer expectations around product, relationship, and brand have risen over years driven by extremely high levels of competitiveness. This has resulted in the need for firms to develop multiple strategies that address different customer segments. Additionally, competition is now local, regional, national, and global. This requires a more nuanced and complex competitive strategy. All of this also drives complexity in process and people. Global organizations or markets require processes to work well in a centralized and decentralized manner. Lastly organizations have become complex as even medium-sized enterprises can have employees across the world. All of this has made strategy, and more importantly the execution of strategy, more relevant than ever before.

 

“Strategy is about execution.” –Sanjiv Anand

 

What are the elements of a strategy that works?

Never build a strategy that can’t be executed. The problem starts there. Most organizations build strategies that are complex, difficult to understand, and hard to execute. A strategy that works needs to be balanced. It needs to focus on the drivers of financial performance rather than just the financial outcome. People and technology help drive process excellence. Process excellence helps meet or exceed customer expectations. And meeting customer expectations delivers financial performance. Therefore, all of these elements are critical for strategy that works—combined with a clear sense of ownership across the leadership team, a set of performance measures that are lead indicators to performance, and a set of targets that focus performance and don’t overwhelm. Focus, balance, ownership, measurement, and the right targets are the elements that make strategy work.

 

“Parallel processing is key to a successful strategy.” –Sanjiv Anand

 

Understand Cultural Differences

What are the cultural differences to be aware of in terms of measurement?

Execution Excellence by Sanjiv AnandIn the U.S., measurement motivates. In many parts of the world, measurement scares. Why? The U.S. has a culture that celebrates individual performance. This is also reflected in how organizations assess and reward people. Drive individual performance to drive enterprise performance is the typical formula; therefore, most executives in U.S. corporations are used to the idea of being measured and being held accountable individually.

Many parts of the world are different. In Japan it’s about team performance, and therefore team measurement is more important. In many parts of Asia, especially India, measurement is generally not part of the culture. Individual performance, or rather lack of it, is not something for public display or discussion. In Europe, the role of the corporation transcends the objective of only meeting shareholder expectations to also focusing on the greater good of society, so measurement of individual performance gets more complicated.

The broader point here is not to suggest that measurement should not be attempted, but the approach to measurement needs to be customized to motivate, not demotivate’ which is the objective in the first place.

 

“A positive strategy should focus on innovation.” –Sanjiv Anand

 

Don’t Make these Mistakes In Setting Targets

How Leveraging the Network Can Help Your Business Grow

The Network Imperative

How to Survive & Grow in the Digital Age

 

How do you create value today?

What’s the best way to scale an enterprise?

How do you grow a company faster than ever and scale with lower cost?

 

It’s all possible if you leverage the network.

 

That’s how companies like Amazon, Airbnb, and Uber have succeeded against the odds.

 

“Entrepreneurial business favors the open mind.” –Richard Branson

 

In The Network Imperative: How to Survive and Grow in the Age of Digital Business Models , authors Barry Libert, Megan Beck and Jerry Wind argue that it is the way companies create value. And today, the best way to create value is through scalable and digitally networked business models – like Amazon, Google, Uber, Airbnb – that leverage networks of employees, customers, and suppliers.

 

Create a Virtual Network

For those not yet familiar with your work, what’s the network imperative?

The network imperative is recognizing that today’s most valuable companies are virtual networks that rely on digital platforms. This leading edge, new business model is emerging in every industry: Amazon and Alibaba in the retail industry, Match.com and Tinder in dating, Facebook and Instagram in Social Media, LinkedIn in professional resumes, Airbnb and Homeaway in room rentals, Uber and Lyft in shared car services, as well as the NYSE and NASDAQ in the financial sector.

 

What did your research show in terms of the financial results of “network orchestrators” versus the other 3 business models?

These business models – which we call Network Orchestrators – are more about orchestrating resources, be it insights, relationships, cars, homes, and skills rather than owning them. In addition, they scale based on the a flywheel effect , e.g. the more people, services and interactions there are on the network, the more others will join and make available their assets – whether that’s friends, photos, resumes, cars or homes.

 

“What’s dangerous is not to evolve.” –Jeff Bezos

 

5 Steps to Become Network Centric

Would you briefly describe the PIVOT model?

Our research indicates that all organizations have dormant, virtual networks of either employees, customers, prospects, suppliers, investors or alumni that, when combined with a digital platform and a clear incentive system to share what they have, what they know and who they know with others, can apply network orchestration to their business model. To help incumbents transition from firm centered (where they focus on what they make, market and sell) to network centric (where they orchestrate what others have and create peer-to-peer connections), we created a 5 step process called PIVOT.  The 5 steps are:

  1. Pinpoint your current business model (e.g. which of the 4 business models are you? Asset builder, service provider, technology creator or network orchestrator?)
  2. Inventory all your assets both tangible (e.g. plant, property and equipment as well as money) and intangible (brand, intellectual capital and relationships as well as interactions and big data).
  3. Visualize your future digital platform that connects your network of people or things.
  4. Operate your new digital network and virtual platform alongside your existing business and protect it while it grows, experimenting along the way to find the sweet spot that insures its success.
  5. Track using new big data metrics such as engagement, sentiment or interaction along with traditional financial measures to see how your network is doing and the value it creates.

 

“Show me your budget and I’ll tell you what you value.” –Joe Biden

How Companies Can Overcome the Pitfalls of Globalization

Global Vision

Overcome the Pitfalls of Globalization

Does your company have global aspirations?

How do you determine which countries to pursue and which to avoid?

 

When growth stalls, many managers decide that the answer to the slowing metrics is in going global. In many instances, managers don’t appreciate the inherent risks, miss the cultural nuances, and miscalculate the legal costs of the lofty goals globalization requires.

Robert Salomon is a professor of International Management and Faculty Scholar at NYU’s Stern School of Business and has been teaching and studying the effects of globalization for nearly 20 years. His new book, Global Vision: How Companies Can Overcome the Pitfalls of Globalization, is a guide to successfully navigating the global marketplace.

As the CEO of a global business myself, I was intrigued by the lessons in the book and reached out to Robert to share some of his findings with you.

 

The Problem of Unbridled Optimism

Global Vision . CoverIn your book, you say that one of the biggest problems with globalization is managers and their unbridled optimistic attitude. How does this increase risk?

The problem is that managers systematically overestimate the benefits of globalization and underestimate its costs. They tend to believe that globalization is relatively easy, and they therefore overlook the economic, political, and cultural risks involved.

Many people cite Thomas Friedman’s book “The World is Flat” as an urgent call toward globalization. What’s usually wrong with this thinking?

More and more research suggests that the world is less global than Friedman suggests, and not just by a little, but by a lot. And so if managers base their views of globalization on Friedman’s work, they will end up making very dangerous assumptions about globalization’s risks and challenges.

Why is overestimating market potential so prevalent?

It is prevalent because managers tend to think that consumers will respond to their company’s products similarly in every market. They therefore believe that they can simply port their existing business model to global markets with little change. In this respect, they fail to recognize the challenges that culture—in the form of different consumer cultures—can place on their business model.

 

Strategic Mistake: Porting existing business models to global markets with little change.

 

Understanding the Importance of Culture

Your research led you to the conclusion that “culture is probably the least understood.” Tell us more about the importance of culture and its role.

Culture is the least well understood of all of globalization’s challenges because culture is difficult to define and measure. Is culture about language differences? Yes. Is culture about religious differences? Yes. Is culture about differences in behaviors, norms, customs, and social structure? Yes. But even if we recognize these differences across countries, they are difficult to quantify and measure. Because culture is difficult to quantify and measure, managers end up discounting its effect on globalization. In my book, Global Vision, I discuss how culture impacts globalization and also how managers can quantify the impact of culture on global companies.

 

Culture is the least understood of the challenges of global expansion.

Break the Rules and Upend Business As Usual

Under New Management

Upend Business As Usual

 

Should salaries be public?

Is it possible to eliminate the performance review process?

Should customers come second?

Do open offices work?

 

Most businesses have rules and practices that have developed over many years. Whether inherited from long ago practices or invented by the company, these rules often continue unquestioned.

My friend Dr. David Burkus is a business school professor and author who questions many common business practices. His research reveals that many of the rules are outdated, misguided, and possibly counterproductive. His research looks at the contrarian practices of companies such as Zappos and Netflix where the rules are being rewritten.

 

“Great leaders don’t settle for low levels of efficiency.” –David Burkus

 

From designing office space to eliminating annual performance reviews and unlimited vacation policies, David’s book ignites a debate and conversation.

Some of the “rules” may stand the test of time because they work while others may be held in place based solely on tradition. Regardless, his newest book, Under New Management: How Leading Organizations Are Upending Business As Usual, is a good reminder that it’s time to review all the rules and determine whether they still serve a valid purpose.

 

The Case for Change

David, in one book, you have assembled some of the most contrarian practices being used in business today. What led you to this approach?Under New Management

After I wrote my first book, The Myths of Creativity, in which I talked a bit about practices like hackathons and 20% time that spurred innovation, I started to get even more curious about the things innovative companies were doing that seemed unusual or opposite of best practices. As I travelled down that rabbit hole I found lots of people writing about why the ideas were unique and appealing, but no one was making the case for why these practices work so well. Since organizational psychology is my background, I started to look at these ideas through the lens of human behavior and found compelling reasons for why they might be better than best practices.

Do you believe many of our management practices and principles are outdated? Is this a global view?

Well that depends. As Daniel Pink rightly pointed out in Drive, the shift from industrial work to knowledge work left a lot that needed to change about how we motivate people. I think that shift has broader management implications, which I explore in Under New Management. So yes, if you’re organization does mostly knowledge work, it’s likely that your management practices are rooted in some outdated assumptions.

 

Ban Email and Increase Productivity

Let’s look at email. Does banning email really work? Do these techniques work in larger organizations? Doesn’t moving to other technology tools just move the problem and not address the fact that it is people, not the tool, that cause it?

Email is an amazing tool because it’s cheap and it’s asynchronous. But it’s a difficult tool for exactly that reason. It’s easy to send…so we send it far too much. And because it’s asynchronous, it moved us to a world where we’re always on. There are a lot of other tools that are also cheap and asynchronous, but it’s a matter of how the tool is used.

And yes, to some extent, it’s a people issue. The companies that banned email took a deep look at their communication needs and settled on another tool for internal communication. If you’ve looked at what your team’s communication needs are and email meets those needs….great. But odds are, there’s a better tool out there.

 

“Leaders are discovering that limiting email improves productivity.” –David Burkus

 

13 Counterintuitive Ideas to Upend Business As Usual

  1. Outlaw email.
  2. Put customers second.
  3. Lose the standard vacation policy.
  4. Pay people to quit.
  5. Make salaries transparent.
  6. Ban non-competes.
  7. Ditch performance appraisals.
  8. Hire as a team.
  9. Write the Org chart in pencil.
  10. Close open offices.
  11. Take sabbaticals.
  12. Fire the managers.
  13. Celebrate departures.

 

Eliminate the Performance Appraisal

6 Ways to Create A Magnetic Mindset and Attract Business

Magnetic: The Art of Attracting Business

Build A Magnetic Brand

 

Why do some businesses overflow with customers while others barely make it?

How do you attract customers?

What are the growth strategies that leading businesses use to gain momentum?

 

“Great work is magnetic.” -Joe Calloway

 

Joe Calloway has studied businesses that consistently create positive experiences. His new book, Magnetic: The Art Of Attracting Business, is a look behind the scenes at the strategy, the people, and the art behind becoming a magnetic business. In these organizations, growth is a result of happy customers sending more and more business and referrals. Employees are happy, helping to recruit others. And the momentum continues unabated to create even more success.

I recently talked with Joe about what it takes to become a magnetic business.

 

Become a Magnetic Business

Would you share one example of a business that is magnetic?

Pancake PantryI think that the business pictured on the first page of the book is a classic example of a magnetic business. The Pancake Pantry has a line of customers in front every morning, rain or shine, sleet or snow. This truly is what every business of any kind aspires to: to have customers so loyal to and enthusiastic about your business that they’d be willing to stand in line, in the rain, to give you their money.

Pancake Pantry excels at the basics of what a restaurant should be and have, including a great location, great food, great service.  But here’s the lesson:  there are no gimmicks.  There’s no contrived “wow” factor.  They simply offer excellent value to their customers, and those customers tell other customers.  Thus, the line out front.

 

“It’s very easy to be different, but very difficult to be better.” -Jony Ive

 

6 Factors to Creating a Magnetic Mindset

You start your book by recognizing that, “Becoming magnetic is a way of thinking.”  How do leaders develop the magnetic mindset?

I think there are a handful of basic factors at work that create a magnetic mindset:

  1. Always be focused on creating value for your customers.
  2. Simplify the way you think about your business.  Don’t overthink it.  Don’t over-complicate it.
  3. Never underestimate your competition.
  4. Be exceptionally easy to work with.
  5. Make sure that the other guy wins.
  6. Be consistently excellent.  Consistency of performance is the great brand builder.

If you let these factors guide your thinking, you’ve got a magnetic mindset.

 

Don’t Overdo Social Media

You teach and talk about the importance of social media but also about overthinking, overworking or overdoing its role relative to everything else. As I say this, what comes to mind as “magnetic advice” about social media?

Social media is vitally important in today’s marketplace and becoming more important all the time.  Of course you should participate on social media, but be selective.  You don’t have to be on everything – that would take up all your time and drive you crazy trying to keep up.  Where is your target market?  If they’re on Pintrest, be there with them.  My market is on twitter, Facebook, and LinkedIn, so that’s where I am.

But here’s the key:  What you say about yourself on social media is insignificant in importance and impact compared to what your customers/clients say about you.  No ad campaign in the world has the positive impact of having 100 reviews of your business with almost all of them being 5 Star reviews.

The way to use social media to grow your business and attract new customers is to do such a great job on a handful of vitally important things that matter to your customers.  That’s really one of the core messages in Magnetic: The Art Of Attracting Business.

 

Nielsen: 43% of consumers more likely to buy when learning about it through social media.

 

What’s your version of win-win?

9781119147343.pdfThe Win-Win strategy is what has made me successful.  It’s the single most powerful strategy known and is the foundation of how any consistently successful business or individual relates to other people.

My version of Win-Win is to always think in terms of what kind of experience my actions will create for my clients and others.  How does doing business with me make them feel?

We all want people to love doing business with us, and if we are to create that, then we have to play Win-Win with them.

It’s the simplest and most effective relationship and business strategy known.

 

6 Factors to Create a Magnetic Mindset

 

  1. Always be focused on creating value for your customers.
  2. Simplify the way you think about your business.  Don’t overthink it.  Don’t over-complicate it.
  3. Never underestimate your competition.
  4. Be exceptionally easy to work with.
  5. Make sure that the other guy wins.
  6. Be consistently excellent.  Consistency of performance is the great brand builder.

 

“When you say no to the wrong people, it opens up the space for the right people to come in.” -Joe Calloway