Value-Focused Activity Framework - Part II

Success in the world of business is not a function of pure luck. Rather, companies that have succeeded in the past and are still thriving today have done so through deliberate value creation that leads to strong and sustainable futures for all stakeholders. In this four part article we share with you a simple framework for aligning activities to the path of real value creation.

JULY 2012 • Tsuwa Thompson

In This Article

  • Part 2: Strategic Activities – Making an Impact.

  • About the Authors

Part 2: Strategic Activities – Making an Impact.

Is an understanding of the strategic value concept enough to translate an organisation from a place of average performance into the limelight of success?
The answer is obviously no. The challenge here is no longer one of 'the what to do' which I will extend to the practice of strategy formulation. It is one of strategic implementation – getting the 'boots' on ground to make an impact and take the organisation a step closer to the vision.

The Oxford Dictionary5 defines the word impact as 'a marked effect or influence'. At one point in all our lives we have made an impact and touched one or two people. This may sound like some sort of consolation, but if it is, it surely doesn't work in the corporate world where shareholders are calling for sustained and high impact performance from the custodians of their wealth.

My first boss in the corporate world said, 'no one will praise you for efforts, but for results'. The corporate world requires and demands that employee embrace high impact thinking; that is a results oriented approach that understands the need to differentiate activities not just on the basis of strategic value, but also on the basis of degree of impact to the business. This breed of employees understand that one activity may take the organisation 10 steps closer to the vision, while five others, all with strategic value content, will not get it half as close. That's why they invest their efforts more on strategic value activities with high impact to achieve maximum results - Figure 3.

Figure 3 – Degrees of Activity Impact.

On a day to day basis, high impact thinkers and leaders have to sift through the organisational imperatives and remind themselves of what counts – high impact activities. Missing the way and hitting below average scores is not just a risk but it is a reality happening to leadership teams and frontline employees everyday in companies around us. Figure 4 depicts the challenge of choosing the right high impact path in dealing with organisational challenges though in a simplistic manner.

Figure 4 – Business Scenarios: Choosing the right activity for high impact.

For scenario 1, most people will jump at activity A following path 1 (P1) as opposed to path 3 (P3) and correctly if I may say so considering the looming bankruptcy. Yet for scenario 2, it could go either way coupled with quite a hot debate in the boardroom. Some would argue that the $0.5m would lead to a stabilising cash injection that will also allow for a stronger marketing drive including the CRM software deployment. Others would say why weaken the balance sheet when all we need is much more aggressive marketing spearheaded by the CRM software deployment? The devil's advocate would create an alternate high impact combination represented by path 5 (P5).

Which of these two activities would one deem to be the high impact activity in scenario B or any other scenario for that matter? The answer boils down to the interplay of three factors.

  1. Quantum of value creation – how much value in Dollars and cents does the activity bring to the table? What is the real benefit of the activity to the bottom line? Kaplan and Norton in their book 'Strategy Maps' warn against a myopic approach to determining the value that strategic activities bring to the table. Paraphrasing their words, 'value should not be determined by single activities but by the bundle of value adding activities that the organisation considers to be of strategic value'. While activities A and B are part of the value bundle, one may be a stronger financial component bringing value to the organisation faster.

  2. Timing of value capture – How long after the activity starts, before the organisation begins to enjoy the benefit of the activity? $2.5m by the end of the financial year is too little too late when a financial tsunami may well have washed away the memory of the organisation along with its wonderful blue ocean strategy.

  3. Organisational level of impact – Will the impact of the activity permeate the whole organisation at all levels or just the back office accounting team? Will the value-ripple effect from the activity change the way we do things in critical departments increasing our service delivery, value creation and profitability?

Sincere and dispassionate assessment of these underlying factors will determine which activity rides to the top of our high impact activity list. Such an assessment will prove to be a dear friend to that CEO or manager who seeks to add value to their organisation and take it one step closer to vision fulfilment.

As we move away from the boardroom, the citadel of strategy, to the factory floor or sales field, activities become but daily drudgery and the probability of losing sight of strategic value and or getting stuck in a cycle of low impact tasks, is high. The ability of an organisation to capture, distil and retain strategic value concepts and decisions at lower levels in the organisation, is critical to it achieving its strategic objectives.

In between the executive team and the frontline staff, two very dissatisfied sets of people, lie the line managers (middle management). Their job goes far beyond keeping these two groups happy, and a critical element of these relationships is communication. Line managers have the arduous task of deciphering the bigger picture (strategic value direction) and redrafting the message in such a way that when it is delivered to their teams, not a drop of value is lost. Their communication skills need to be top notch to ensure that the strategy communication phase does not steal needed and important implementation time. On the interpersonal front, line managers need to be able to manage the mixed emotions and rational arguments that individuals will field when they hear about great or even little change that has been mandated from the boardroom. The possibility that employees will deliver high impact performances rests in this moment; the moment when their manager succeeds or fails to be an effective conduit for strategic value clarification.

A proactive team leader would choose a simpler and easier path than the one described above. He/she would involve his team from the beginning of the strategic management process. The leader would spend time tapping the minds of employees in a bid to answer some basic but very important questions.

  • → Where are we relative to our mission?
  • → What are we doing well?
  • → What can we do better?
  • → How do our customers see us?
  • → What should be our next steps?

If these questions are asked genuinely and the answers are incorporated in the strategic planning process, then the definition of strategic value for any company would not be solely based on top-down thinking, but it would also find its root in the innovative minds of those that execute the day to day tasks and form the company-customer interface.

Picture a scenario with me. All the line managers of company X have the strategic plan package in their hands and have to share the details with their teams the next morning. Imagine what thoughts would go through their minds that night. For some there is a natural feeling of apprehension and to compensate some switch to command and control mode, others just wing it. For line manager A who involved his/her team in the process from the start, the conversation will be so much easier. After all, it's not the first time they are hearing about the strategic plan; the team actually contributed to defining what would really have a high impact on the company's performance. The likelihood that such teams would deliver high impact performances consistently is great.

Perfect translation of the high impact focus to the frontline teams is just the beginning of any success story. Great strategies destined to change business landscapes have stalled because the people handling the throttle lacked the desired finesse to maximise the organisation's output. The next chapter is all about line managers working with their people to deliver stellar performances which are tied to building a high level of efficiency and effectiveness in daily execution. There are four areas where teams need to develop and show strong competence if they are to play a significant role in delivering their company's strategic agenda.

Prioritisation – Focus your main execution efforts on high and medium impact activities (refer to Figure 3 above). It may seem like a cliché, but this is where Pareto like thinking defines the results organisations get from their people. One thing we have learned from Stephen Covey1 is that we should put the big stones (high impact tasks) into the empty jar first before the smaller ones (medium and low impact tasks) if not the smaller ones will prevent the bigger ones from fitting into the jar and what a calamity that would be to any company. Nevertheless, don't ignore the low impact tasks – they are still important in the scheme of things. Delegate them and free up your time for real high impact duties – remember that low impact for you is high impact for someone who reports to you.

Eliminating interruptions – We are grateful for those days when we get to work and there are absolutely no interruptions. Those days we outpaced ourselves and broke different work related records, delivering what we would dare call high impact performances. Yet those days are far from the norm; rather they are quite rare and placed on the endangered species list. From idle chit chat, donkey loads of emails and a multiplicity of personal and work phone calls, we hardly have time to touch our to-do lists. The advent of social media or should we say epidemic, has led to an increase in the rate of interruptions in the workplace.

Timothy Ferriss2 cautions on interruptions saying that they could derail a very important task. He highlights that it takes a good deal of time to build up the required momentum to execute tasks and interruptions may set us back minutes to hours when they take us away from these tasks. We need to determine the things that aid our performance, value creation catalysts, and those that limit us, value erosion agents, and treat them with the appropriate amount of fertiliser or pesticide.

Think about the amount of time you could save if you eliminated half the number of interruptions you faced on a weekly basis? Imagine the quantum of work you could get done and the greater impact you could have? Now dare to think a little harder about the benefits – vacation when you want, flexible work hours from your boss for Mr./Mrs. Efficient, company awards for stellar performance, self fulfilment, and much more. Now imagine what would be the payback for the company if fifty percent (50%) of their employees could do the same?

'Systems Thinking' – Many people have said that we cannot continue to do things the same way and expect different results. 'Systems thinking' disagrees with this just a little bit. Systems are channels through which we channel our efforts to get consistent results. Systems are critical to organisations especially from a product or service quality perspective as they really don't want 'different results' all the time which implies service flaws. How does 'systems thinking' apply to effectiveness?

Most tasks are repetitive and similar in nature though the intervals between one event and another differ from task to task. Understanding the demands of the task and the factors that affect execution efficiency, allows us to create systems to manage the task so that we always get the same, if not better results, the next time we have to execute the task. A good example is the concept of procedures. Procedures are systems that ensure a particular task is done the same way and delivers the same results despite the fact that different employees are responsible for executing the same task. Procedures aren't static; they are updated (innovated or eliminated) as needed to embrace new operational realities and such should be the case of all systems. An MS-Excel template (system) could be developed for assessing marketing lead profitability. The template will lead to a clear and consistent project assessment approach, unlike a situation where each marketer relies on his/her own ingenuity to produce such a report for his line manager's appraisal. The latter will lead to more discussions, delaying the approval process and reducing execution efficiency and effectiveness.

Developing a 'system' for every task goes a long way to improving your effectiveness as systems increase speed of delivery and assure one of consistent quality, that is, high impact performance.

Accountability – "In leadership roles, accountability is the acknowledgment and assumption of responsibility for actions, products, decisions, and policies including the administration, governance, and implementation within the scope of the role or employment position and encompassing the obligation to report, explain and be answerable for resulting consequences".3 Let me phrase it this way, "own your ship".

So many companies are burdened with employees who really don't care, or are at work for every other reason but the company's vision. The level of employee engagement in these organisations is low and concomitantly, the depth of accountability is very shallow.

When employees step up as leaders, taking responsibility for their actions and committing to accomplish the strategic goals before them, then and only then are the hopes of an organisation likely to be secure. High impact performance is all about the 'U' in 'accountability'.

At the centre of all these teams is the positional leader whose responsibility it is to manage the employees for the strategic advantage of the company. Quite often, the centre fails and everything comes crumbling down including the bottom line. Spark Notes4 explains the words of Chinua Achebe - "Things fall apart; the centre cannot hold; Mere anarchy is loosed upon the world".

  • In invoking these lines, Achebe hints at the chaos that arises when a system collapses. That "the centre cannot hold" is an ironic reference to both the imminent collapse of the African tribal system, threatened by the rise of imperialist bureaucracies, and the imminent disintegration of the British Empire.

The line manager is pivotal to the survival of the organisation's 'tribal' system and today a lot of internal factors are stacking up and threatening the existence of the system. Organisational politics, poor managerial acumen and below par people management skills are some of the culprits. The manager has to dig deep within and look without to safeguard his team and deliver optimal results that will secure the organisational empire. He/she must educate and inspire the team; build and strengthen the team members and carry them through the short term wins to the promised land of the firm's vision. Continued and sustainable efficiency and effectiveness in executing high impact tasks and taking the company closer to its vision, rests squarely on the manager's shoulders.

<<< For Part 1 of the Article, Click Here

About the Author

Tsuwa Thompson is the Chief Executive Officer of RtHE Consult Limited.

Part 1 References.

  1. The 7 Habits Of Highly Effective People (1989), by Stephen R. Covey.
  2. The 4-Hour Work Week: escape 9-5, live anywhere, join the new rich (2007), by Timothy Ferriss.
  3. Williams, Reyes (2006) Leadership accountability in a globalizing world. London: Palgrave Macmillan.