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04-03-19

Misalignment: The Root Cause of Organizational Dysfunction

PotholesI believe that the root cause of virtually every organizational problem is misalignment.

Why do I believe that? Let me count the ways!

When your market vision is misaligned, you miss growth opportunities.

When your business model is misaligned, you lose money. 

When your human resources strategy is misaligned, you hire the wrong people.

When your product development team is misaligned, you build the wrong product.

When your operating model is misaligned, people spend endless hours in internal coordination meetings.

When your mission-critical processes are misaligned, you miss your deadlines and irritate your customers.

When your management system is misaligned, decisions are frequently overturned.

When marketing and sales are misaligned, you miss your revenue targets.

When management and labor are misaligned, workers go on strike.

When the board and the CEO are misaligned, the CEO gets fired.

I could go on, but you get the point: misalignment is the root of virtually every organizational dysfunction.

We also see misalignment as the root cause of most interpersonal conflicts.

For example, recently I was coaching an executive who was struggling to meet his numbers. I asked him, “Why are you missing your numbers?”

He gave me an explanation that seemed plausible, but then I asked, “Would your boss agree with that explanation?”

“Probably not.”

Given that the executive and his boss were not aligned on the root cause of the problem, there was little chance that they would agree on the executive’s proposed solution.

In another session, a different executive was recounting her accomplishments. Again, I asked the question, “Would your boss agree with that list?”

“Probably not.”

In both cases, the executives and their bosses were misaligned.

Alignment is both a strategic corporate issue and a tactical interpersonal one.

That is why improving alignment is Job One!

03-27-19

Divisions—by Definition—Divide

shutterstock_62272-OneProblemWhen companies are small, they are in One Business. They target One Market. They sell One Product. There is One P&L. Everyone probably sits in One Office. But, as companies grow, they create divisions. 

There is only One Problem: divisions—by definition—divide.

Just to be clear, even small, One Business businesses can have alignment problems. (We’ve even worked with solopreneurs, otherwise known as One Person Companies, who had alignment problems.)

But the larger you are, the more likely you will struggle with strategic alignment. The big turning point is when your company creates divisions.

Some companies divide by product line. Some divide by geography. Some create business units. Some organize by function.

How is your company divided?

By product? By market? By function? By geography? Some other way?

Once your company has divisions, you must decide if it is important to align them.

Yes, I said “if.”

Theoretically, your company could allow the divisions to operate totally autonomously, with virtually no alignment. Some companies, such as Berkshire Hathaway and Virgin, operate as a “company of companies.” There is just a very thin, lightweight corporate alignment process to hold the operating companies together.

However, most companies decide that it is indeed important to create a high level of alignment.

“We must unite the divisions!”

As we explained, companies must align the divisions with corporate and they must align the divisions with each other.

In addition, each division adds its own strategies, goals, standards, priorities, policies, etc. to the things that cascaded down from corporate. Then, departments are expected to align with both the things that cascaded down from corporate and the things that cascaded down from the divisions.

And on and on it goes.

The alignment challenge grows exponentially once a company has multiple divisions. Aligning a company with two divisions is four times harder. Aligning a company with four divisions is sixteen times harder.

Many companies exacerbate the alignment problem by constantly reorganizing. Every time your company reorganizes, the alignment operating system must be rebuilt.

03-20-19

Workforce Changes Radically Affect Alignment

Runners uphillMy dad went to work at General Electric in January 1962.

In just One Generation, the workforce has radically changed, and creating alignment is now radically more difficult.

In my dad's generation, the workforce was very homogeneous. Most of the “white collar” workers were white males. Most of the women in the workforce were in secretarial roles.

Now, the workforce is tremendously and beautifully diverse. The increase in diversity is a great thing. Let me say that again, the increase in diversity is a great thing, but it does make alignment much more difficult.

In my dad’s generation, a large percentage of the workforce had military experience. They were comfortable in top-down, command-and-control organizations. They were trained to obey orders.

Now, the workforce is radically different. Many were raised in the “me” generation. Millennials have a very different worldview. As a result, the old command-and-control way of creating alignment is no longer effective.

In my dad’s generation, there was a basic civility and decency in society. Children were trained to say, “Yes, Ma’am” or “Yes, Sir.” Politicians referred to each other as “distinguished colleagues.” There was a respect for authority.

Now, people denigrate each other every night on TV. They attack each other in social media. They shoot the police. This makes alignment much more difficult.

In my dad’s generation, many companies had either explicit or implicit guarantees of lifetime employment. My dad spent thirty-one years with GE. In fact, when I started at IBM in 1979, the company still had a culture of lifetime employment.

Now, the workforce is extremely unsettled, and most people will work for multiple companies in their careers. Companies expect loyalty, but they don’t give it in return. This makes alignment much more difficult.

In my dad’s generation, the majority of people working at a company were officially classified as employees.

Now, the workforce is an ever-changing mix of employees, long-term contractors, temporaries, and gig workers. This creates multiple classes of workers with different benefits, different rules, different loyalties, and different goals. This makes alignment much more difficult.

In my dad’s generation, when you wanted to communicate with someone who worked in your building, you walked down the hall.

Now, people send an email to the person sitting in the next cubicle. This makes alignment much more difficult.

In my dad’s generation, companies had physical offices.

Now, many companies have large numbers of full- and part-time telecommuters. Some companies, such as Zapier, are 100 percent virtual.

In my dad’s generation, the Fortune 500 was extremely stable: companies remained on the list for an average of sixty-one years.

Now, the average tenure of a Fortune 500 company is fifteen years. Companies are constantly merging, reorganizing, divesting, etc. Companies that were models of stability—like Arthur Andersen, Nortel Networks, and Lehman Brothers—are completely gone.

The combination of these organizational and societal forces has made alignment radically more difficult.

 

03-13-19

Is Alignment Really Necessary for Every Organization?

BigBoatManyRowersWe believe that every organization, regardless of size or industry or operating model, must create strategic alignment.

That is why we say, “Alignment is Job One.”

For every idea, there are contrarians. Alignment is no exception.

So, let’s consider the question: is alignment really necessary for every organization?

Consider some of the common objections to alignment raised by my contrarian friends:

  • Can’t you just let everyone do whatever they feel is right?
  • Won’t top-down controls stifle innovation and creativity?
  • Do you really need rules?
  • Won’t people just naturally self-align to do what is in the corporation’s best interest?
  • What, are we going to all join hands and sing "Kumbaya"?

After all, you can’t legislate morality.

Perhaps you are an alignment contrarian. Perhaps you have these questions and more. If so, consider these examples:

In 2014, the online retailer Zappos adopted a utopian “self-management” model called Holacracy. When Zappos adopted it, hundreds of managerial positions were eliminated. It was hailed as the future of work. Fully empowered employees. Free to contribute. Free to innovate. Free from creativity-stifling management.

Not so much. The Holacracy model has a formal constitution that is 42 pages long.

Consider Burning Man, the annual festival in the Nevada desert. It is designed to be the ultimate, utopian experience of individual freedom and “radical self-expression.” It attracts over 70,000 people from all walks of life (including, ironically, billionaires who fly in on private jets).

But even Burning Man has rules to keep everyone aligned.

Yes, but how about the anarchists?

The International Anarchist Federation is fighting for “the abolition of all forms of authority whether economical, political, social, religious, cultural or sexual.” Interestingly, even the IAF has rules. To become a member, you must agree to align with their statement of principles.

Amazing. Even anarchists need alignment.

I hope these examples help convince you that alignment is mission-critical for every organization.

If your company needs alignment, SHIFTPOINTS offers The Pit Stop Program -- a 30-day engagement that culminates in a One Day workshop. It is intensely focused on One Issue: unleashing the accelerating power of alignment. To schedule your Pit Stop Program, contact us at start@shiftpoints.com.

04-19-18

ONE WORD - ALIGNMENT

a·lign·ment

One word.  Three syllables.  Thousands of applications.

But, what does alignment actually mean? 

The etymology origin of “align” is French.  Webster’s says the first known use of the word was in 1693.  Some of the common uses include: 

  • to arrange things or people in a straight line.
  • to bring things or people into alignment.
  • to bring people into agreement with a particular group, party, cause, etc.
  • to bring things into a proper coordination (such as the wheels of a car).

Align is a verb.  Aligned is a past participle.  Aligning is a gerund.  Alignment is a noun.

Okay, enough of that. 

What does it mean for your company?

If your company is a global conglomerate, alignment means one thing. If your company is a dance company, alignment means a totally different thing.

In addition, our review of the research articles about alignment confirmed that even the scholars don’t have a common definition of alignment.

There are multiple reasons for this.

First, every company is radically different.  Synagogues are radically different from symphonies.  The United Auto Workers is radically different from the United Nations.  3M and IBM have one letter in common … and that’s about it.

Second, companies are in different life stages.  (See the chapter entitled One Life Stage.)  Startups are worried about survival, and spinouts are worried about cutting the corporate umbilical cord.

Third, companies have different operating models and management philosophies. (See the chapter entitled One Model.) Some companies run like denominations, and some churches run like corporations. 

Thus, every company is different, and you must define alignment in your unique One-of-a-Kind Way. 

After all, how can everyone Drive in One Direction if you don’t show them the way?

ACTION POINT:

One Way to get started is to take the One Definition challenge.

Ask a group of people to write a basic definition of the word “alignment.” Share the results around the table. Then, ask them to modify that definition as follows, “What does alignment mean for our company?”

04-04-18

A LEADER WORTH FOLLOWING

This past weekend, millions of people around the world celebrated Easter.  They went to church to worship Jesus and pledged their allegiance as followers. 

To millions, He is a leader worth following.

So, how about you?  Are you a leader worth following?

Leaders, by definition, have followers.  The question for you to consider is why they are following.

Are they following because they have to?  After all, you’re the boss. 

Or, are they following because they want to?  Because they believe in you and your vision.  Because they believe that your strategy is the right one.  Because they believe that you know the way.

So, perhaps it is time for you to take a long, hard look in the mirror.  Ask yourself, “Am I a leader worth following?”

I’m sorry to say that many leaders—if they are honest with themselves—should conclude that the answer to that question is, “No.”

SHIFTPOINTS has worked with almost one hundred companies and thousands of leaders.  I’m sorry to say that we have seen many toxic leaders.  I’m also distraught that many toxic leaders have risen to the highest levels of government, industry, and even churches.

These toxic leaders would dramatically improve performance and morale if they simply resigned. 

Conversely, we have also worked with many exceptional leaders who are, in fact, leaders worth following. 

Leaders worth following are servant leaders.  They lead with humility and inspire followership. 

And the best leaders—just like Jesus—build high-performance leadership teams.

Most people know that Jesus had twelve disciples.  They were a most unusual bunch, perhaps the most unlikely leadership team ever assembled.  None of these guys would have ever passed the initial resume screening of an executive search firm.

Leadership experience… nope.  Advanced degrees… nope.  Professional certifications… nope.

Yet Jesus chose these ordinary guys anyway.  He transformed them into an extraordinary leadership team. And then He left.

They went on to change the world.  All but one gave their life for the cause.  By almost any measure, you can argue that they were indeed the world’s greatest leadership team.

SHIFTPOINTS develops high-performance executive teams – because you can’t win without one.

 

04-17-17

#12:  THE DISCIPLINE OF INSPIRATION

Good executive teams manage the business.  Great executive teams lead the business. 

But world-class executive team inspire the business.

For me, Holy Week is always the most inspiring week of the year.

And it was a good reminder of how important it is for executive teams to inspire. 

I think it is too easy for executive teams to get caught up in goals, plans, KPIs, and ops reviews, and lose sight of their ultimate responsibility.

Which is to inspire your company.

In addition, far too many executive teams have money as their ultimate definition of success.  It has been said that money is an excellent servant, but a terrible master.

Making money is a good thing.  Shareholders expect a return, and employees expect a paycheck.

But your company needs a higher purpose.  Your company needs to make the world a better place.  Your vision needs to articulate these things in an inspiring way.

Virtually every company has a mission, vision, and values.  Candidly, most are the kind of corporate blah-blah-blah that everyone tunes out.

So, my challenge to executive teams is to write a corporate purpose statement.  A corporate purpose statement answers a very simple question.

Why do you exist?

And, if you want to inspire your team, the answer better not be, “to make money.”

SHIFTPOINTS® develops high-performance executive teams - because you can't win without one.

02-27-17

#11: THE DISCIPLINE OF DECISIVENESS

One of the most dysfunctional and destructive organizational pathologies is undermining, especially at executive levels.

Unfortunately, we see this all the time. 

Issues are discussed at the executive meeting.  Alternatives are debated.  And eventually, a decision about the best course of action is made.

Far too often, what happens next is that executives who did not get there way undermine the decision.  Sometimes, their undermining is overt, blatant, and public such as when executives say, “They made a dumb decision.” 

Most of the time, however, the undermining is much more covert.  Whispering at the water cooler.  Backstabbing in the bathroom.  Sniping at Starbucks.

This kind of behavior, especially at executive levels, must never be tolerated.

In contrast, high-performance executive teams debate, decide, and align. 

First, there is an open and candid debate.  The CEO – or the most senior leader in the group – plays a critical role in creating the environment that facilitates this.  Far too often, decisions are made by a CEO who is in monologue mode.

Second, there is a decision.  There are many ways that executive teams make decisions.  Sometimes, the CEO decides unilaterally.  Sometimes, there is a group consensus.  Sometimes, one executive makes a recommendation and the team endorses it.

Finally, once a decision is made, everyone aligns behind it, even it if wasn’t their preferred course of action. This is the discipline of decisiveness.

A few check-points for your executive team to consider:

  • Does your team have productive debates about strategically important issues?
  • Does your team make effective decisions in a timely manner?
  • Is your team suffering from undermining?

SHIFTPOINTS® develops high-performance executive teams - because you can't win without one.

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02-20-17

#10: THE DISCIPLINE OF A SINGLE METRIC

Executive teams track and evaluate many metrics to get a complete view of performance, but high-performers identify One Number as the main one.  

Because you can’t win if your team doesn’t know how you keep score.

The problem with most dashboards is that they are too complex.  They present a mind-numbing array of information.

Many numbers are important, but it is the job of the executive team to decide which One Number is the most important one.

Revenue.  Revenue Growth.  Profitability.  Market Share.  Customer Satisfaction.  Net Promoter.  Employee Engagement.  Human Sigma.  Economic Value Added.  Return on Assets.  Earnings per Share.  Share Price. 

All of these metrics (and more) are important. 

Which one is the most important?  That depends on how you define success. 

Ideally, find One Number that is simple to measure and simple to communicate.  Something that is a leading indicator, rather than a look in the rear-view mirror.  Something that drives your economic engine, fuels your growth, and ignites your passion. This is the discipline of a single metric. 

SHIFTPOINTS® develops high-performance executive teams - because you can't win without one.

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02-12-17

#9: THE DISCIPLINE OF PRIORITIZATION

For seventeen years, Ford used an incredible tagline.

Quality is Job One.

The Ford executive team had the courage to admit that their cars had quality problems, and fixing them was critical to the company’s survival.

So critical that the Ford executive team made it Job One.

Every organization has a multitude of issues.  They have a multitude of opportunities.  All of them are important.

But only one of them can be Job One!

High performance executive teams apply the discipline of prioritization to make one thing Job One. 

Providing this kind of specificity requires what Jim Collins calls "piercing clarity."  Most executive teams lack the courage or discipline to do it.  They have twenty-seven priorities… and wonder why the organization is confused about what is important.

So, what is your organization’s Job One?  Profitability?  Sales?  Customer service?  Employee engagement?  Cost control?  Quality?

In addition, Ford made quality their Job One for seventeen years!  Most executive teams can’t stay on one thing for seventeen minutes.

High-performance executive teams know that it takes a long time for organizational performance to improve.  Pick One Thing.  Make it Job One.  Stay with it… for seventeen years – or as long as it takes.

SHIFTPOINTS® develops high-performance executive teams - because you can't win without one.


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