The SHIFTPOINTS Blog

To improve alignment, your executive team will likely have to deal with tough, deep-seated issues.

We strongly recommend that you use the “debate, decide, and align” model.

One of the most dysfunctional and destructive organizational pathologies is “undermining.”

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 their way undermine the decision. Sometimes, their undermining is overt, blatant, and public, such as when executives tell their direct reports, “They made a dumb decision.”

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

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

High-performance executive teams use the “debate, decide, and align” model. Once a decision is made, everyone aligns behind it, even it if wasn’t their preferred course of action.

I recognize that this is difficult. Most people can’t simply turn a switch and become passionate champions for an idea they vehemently disagreed with.

We once worked with a company that was grinding through the process of selecting their One Number.

First, there was a debate about whether using One Number to improve alignment was a good idea or not. Frankly, some executives thought it was unnecessary. Eventually, the CEO decided that it would indeed help the company improve alignment.

Once the CEO decided to do it, there was another debate about which number to choose. Then, there was another debate about the formula they would use to calculate their One Number. Then, there was yet another debate about what the target should be.

That is why creating alignment can be exhausting.

Ultimately, we came to a decision. We would use One Number. We agreed on One Formula and One Target. We launched the idea in a company-wide campaign.

Unfortunately, one executive (who was part of the entire process) refused to comply. Every time he showed his metric in company meetings, he used his own (non-compliant) formula. This was blatant, intentional undermining.

I would have fired him, but the CEO was reluctant to do so because his division was the most profitable one.

Alignment is a choice. And so is undermining.

In some cases, the undermining is intentional and volitional. In other cases, it is passive-aggressive.

Sometimes, the underminer is a single individual, acting alone. In other cases, it is led by a group or coalition. (We once facilitated an executive team offsite where a group of executives came into the meeting with the expressed purpose of leading a mutiny against the CEO.)

You should use the “debate, decide, and align” model to address critical alignment issues.

NOTE: This is an excerpt from my latest book, Drive One Direction.

Every company has a system for managing the business.

But most are not particularly systematized.

When your company is small, managing it is relatively easy.

As you grow, complexity increases exponentially. To effectively manage the business, companies must create a management system.

In the classic Harvard Business Review article, “Mastering the Management System,” professors Robert S. Kaplan and David P. Norton describe the need for a management system:

“In our experience, however, breakdowns in a company’s management system, not managers’ lack of ability or effort, are what cause a company’s underperformance. By management system, we’re referring to the integrated set of processes and tools that a company uses to develop its strategy, translate it into operational actions, and monitor and improve the effectiveness of both.”

There are dozens of different management systems. Some of the most popular ones include:

• The balanced scorecard, developed by Harvard Business School professors Robert S. Kaplan and David P. Norton
• Objectives and key results (OKRs), developed by Andy Grove at Intel
• “The Rockefeller Habits,” developed by Verne Harnish
• “The Entrepreneurial Operating System,” developed by Geno Wickman and Don Tinney
• “Holocracy,” developed by Holocracy One
• “The Top Gear System,” developed by SHIFTPOINTS
• And many others

Each of these systems can be effective, but we advise clients to pick One of them. When a company adopts One System as your Alignment Management System, it provides a common language, which speeds communication and reduces friction.

Does your company have One Alignment Management System?

NOTE: This is an excerpt from my latest book, Drive One Direction.

Every company has a culture.

But most have a dysfunctional one.

The Three Musketeers is a novel by Alexandre Dumas set in seventeenth-century Paris. It tells the story of a young man named d'Artagnan who wants to join the Musketeers of the Guard.

The Three Musketeers made the phrase “all for one and one for all” famous (“tous pour un, et un pour tous”).

All for One and One for All.

This sounds a lot easier than it is. Unfortunately, the cultural dynamic we often see is “All for me and none for you!”

Companies actually have dozens of cultures.

The accounting team has a culture. The European sales team has one. The manufacturing plant has a different one.

The key is to build a One-Company culture that unifies and aligns everyone.

Unfortunately, Bain & Company research found that only 10 percent of companies have a high-performance culture.

While there are many reasons for this, one of the most dysfunctional is infighting.

Sometimes, this behavior is demonstrated in the budgeting process, which is often managed as a zero-sum game. Sometimes, it manifests itself in unhealthy internal competition and power struggles.

Peter Drucker famously said that “culture eats strategy for breakfast.” That sounds good, but I am not sure it is true.

What is true is that companies with One-Company cultures can leverage the full breadth and depth of the firm to win and serve customers. These highly aligned companies eat their fragmented and dysfunctional competitors for breakfast … lunch … and dinner!

Ideally, your company has built the One-Company mindset into your culture from Day One.

If, however, you have allowed your culture to disintegrate into warring tribes and dysfunctional fiefdoms, you have a lot of work to do.

Does your company have a One-Company culture?

NOTE: This is an excerpt from my latest book, Drive One Direction.

If your company is massively misaligned, you may need a One-Company Campaign.

Before you decide, remember that many people are jaded, cynical, skeptical, and distrustful of these kinds of initiatives.

And that is on a good day.

Nonetheless, should you decide to implement a One-Company campaign, your company should employ several best practices, including:

• Inspire results with relentless, unwavering leadership. Alignment does not just happen. It takes lots of hard work and an intentional focus on the issue.
• Manage alignment with a high-powered A-Team. The Alignment Team will manage the alignment process. (Some companies call this a program management office, or PMO.) They must have the organizational credibility and political capital to build coalitions and break down barriers.
• Create excitement with a high-energy launch. One way to accelerate results is to launch the change with town hall meetings, e-mail blasts, videos, web content, posters, banners, and the obligatory T-shirts. While these elements can be fun, their impact is short-term. So, launch with fanfare, but sustain the effort. And remember, many people are cynical about these kinds of things. Don’t be lame.
• Accelerate alignment by leveraging key influencers. It is essential to have key influencers, both internal and external, on board with the program. Find and empower your early adopters. These people “get it” right away, and incorporating their suggestions is critical to accelerating success.
• Visualize progress with a war room that dramatizes the change. This is a fantastic tool for highlighting misalignment. This can be especially helpful when your company has lots of “old versions” of things. Use a progress wall so everyone can see the before and after.
• Build endurance with a steady stream of wins and validations. Delivering early wins is a must. Celebrating them publicly will generate momentum, but avoid declaring victory too early. Many programs start out well but hit the wall. Easy issues are resolved first; difficult ones are procrastinated. Success requires endurance.
• Drive progress with a clear project timeline, roadmap, and deadlines. Often, this means going faster than most think is possible or prudent. Some may worry about the timeline being too aggressive, but our experience is that organizations can change a lot faster than they think they can.
• Run the transformation in 90-Day SPRINTS. SHIFTPOINTS has had tremendous success with the 90-day SPRINT model. Start by breaking the transformation into specific initiatives that can be accomplished within 90 days. Meet at the start of every quarter to review progress. Color-code each initiative with red, yellow, or green to indicate whether it has been accomplished.

These best practices will improve the probability of success. 

NOTE: This is an excerpt from my latest book, Drive One Direction.

As you surely know by now, we believe that alignment is the ultimate competitive advantage. If you share that conviction, then creating alignment is not a tangential, tertiary, nice-to-have issue for your company. It is mission-critical.

Otherwise known as Job One.

The exemplar companies featured in my book, Drive One Direction, completely embraced this idea.

Of course, this starts with the CEO.

During my interview with Alan Mulally, he actually used our tagline, “Alignment is the ultimate competitive advantage.”

Randy Papadellis, operated as Ocean Spray’s “Chief Alignment Officer.”

The founders of The Carlyle Group were so convinced of the importance of alignment that they codified the “One Carlyle” message from Day One.

Gail McGovern’s unwavering commitment to being “One Red Cross” was the key to their amazing turnaround.

Linda Chadwick, the Chief Executive Officer of Rita’s Water Ice, explained this emphatically, “Getting everyone going in the same direction is my Number One Priority.”

The executive team must embrace this idea as well. They must truly believe that alignment is mission critical.

Too often, we see passive “lip service” commitments to alignment initiatives. People say that alignment is Job One, but their actions deliver a different message.

We recommend that companies use assessment tools like the SHIFTPOINTS Corporate Alignment Percentage or the Acceleration Index to quantify the their current level of alignment.

We also suggest that companies use those metrics to calculate the true cost of misalignment. For most, this will be a startlingly high number. 

Once you have quantified the cost of misalignment, improving it will surely be One of your priorities … but will it be Number One?

It seems redundant to say, “One Number One Priority,” but some companies have so many priorities that everything is a priority. Too often, companies even have competing, contradictory priorities.

Bill Pollard, the retired chairman of ServiceMaster, was talking with Peter Drucker about priorities. Peter said, "Bill, it wasn't until the 20th century that we pluralized the word priority. For most of its history, the word has been singular."

So, if you can only have One Number One Priority, what should it be? We obviously think that alignment must be Job One.

To turn alignment into a competitive advantage, it must be Job One.

The American Red Cross (www.redcross.org) has nearly 20,000 employees and more than 370,000 volunteers.

They are thousands of people … with One Mission.

The American Red Cross has an amazing heritage. It was founded by Clara Barton in 1881 and has been serving people in need ever since.

However, when Gail McGovern was appointed CEO in 2008, the organization was fragmented and in financial distress.

Here is how McGovern described the situation, “We had 720 different chapters. Each one had a CEO. Every chapter had their own general ledger, their own financial systems, their own bank accounts, their own website. If you put in ‘disaster relief’ in Google, we wouldn’t even come up because there were 720 little websites.”

In addition, they had a $209 million operating deficit and had to borrow money just to make payroll. And to make her challenge even greater, she was the tenth permanent or interim CEO in 12 years.

McGovern developed the “One Red Cross” plan to transform the organization. The plan included six strategic initiatives: achieving financial stability, increasing donations, improving blood services quality, revitalizing the Red Cross brand, modernizing IT systems, and promoting teamwork.

Creating a “One Company” culture is always challenging, but it is probably ten times harder in volunteer-powered organizations.

Prior to joining the Red Cross, McGovern was a professor at the Harvard Business School. Before joining HBS, she held senior executive positions at AT&T and Fidelity Investments. While she was clearly a highly regarded and accomplished executive, leading volunteers required her to develop new leadership skills.

“In the corporate world, people jump when the CEO says so. At Red Cross, I would say jump … and the volunteers asked why?” she explained. “So, I had to create alignment through the power of my ideas, not the power of my office.”

The transformation of the Red Cross required massive changes. Like any change initiative, there was some resistance. Overcoming this resistance required persistence, fortitude, constant communication, and an outstanding team.

McGovern shared a key insight about her experience: “People don’t hate change … they hate uncertainty.” But ultimately, she found that “Red Crossers were willing to make whatever changes were necessary to save the Red Cross and its life-saving mission.”

Since implementing the One Red Cross plan, the organization has become financially stable, more efficient, more agile, and more aligned.

The first exemplar we studied was Alan Mulally’s remarkable transformation of Ford. I think it is fitting that our last exemplar is Gail McGovern’s similarly remarkable transformation of the American Red Cross.

Both leaders were outsiders brought in to turn around proud, century-old institutions. Both leaders inherited highly fragmented organizations that were in deep financial trouble. Both used the accelerating power of alignment to get their organizations driving in One Direction.

Does your company operate as One Company?

Note: This is an excerpt from my book, Drive One Direction.

SHIFTPOINTS® helps companies unleash the accelerating power of alignment.

Because alignment is the ultimate competitive advantage.

Note:  This is an excerpt from my latest book, Drive One Direction: How to Unleash the Accelerating Power of Alignment. In the EveryOne chapter, we highlight companies who unleashed the accelerating power of alignment with an intense focus on talent management disciplines. 

Simplexity Product Development (www.simplexitypd.com) is a product design engineering firm with four West Coast offices.

Although they are small in size, their bonus plan creates alignment in a big—and radical—way.

It is easy to talk about aligning people with your vision, mission, and values. After all, talk is cheap.

But when it comes to using your compensation plan to create alignment, you should put your money where your mouth is.

Ever since I started working on this book (One Decade ago!), I have been looking for an exemplar company that used an innovative compensation plan to create alignment. My search ultimately led me to Simplexity. Rather than paraphrase the idea, I’d like to share excerpts of a blog written by Dorota Shortell, their Chief Executive Officer:

“I’ve been thinking about whether or not to share this publicly but given the recent talk about how the working class has been largely ignored and how the rich are getting richer, I think it’s my duty to speak out. I want to change the conversation and question the status quo. I’ve noticed that in corporate America there is often a class system. There’s the executive class and then there’s the working class. The executives are paid way more, get better benefits, and get big bonuses. It doesn’t have to be that way.

Since we are a privately held company, we get to decide how to run things. Simplexity’s bonus program does not follow industry standards. Usually year-end bonuses are based on meeting certain metrics and the higher up in the organization you are, the bigger bonus you get. Or they are pro-rated based on salary, so everyone gets, say, a 2 percent bonus. But if you make $30,000 a year, that’s a $600 bonus and if you make $150,000 a year, that’s a $3,000 bonus.

While there may be benefits from doing it this way, I view the annual bonus as an extra benefit for helping to contribute to the success of the team. People are already paid different salaries based on if they are an engineer or a technician, a CEO or an office assistant.

Yet every role in a company is important to meeting the goals, or it shouldn’t be there in the first place. With that point-of-view, the annual bonus is a way to share the wealth.

So, here’s how we set the annual bonuses at Simplexity: A certain amount of net profit (say 10 percent) is set aside in a bonus pool and then divided equally by every full-time regular employee who has worked for the company during the past year (and pro-rated for those who recently joined the company). Each person gets the same amount. That includes me as the CEO, all the executives, as well as all the technicians, and office staff. Everyone, the same dollar amount.”

Yes, that’s right. Every person gets exactly the same bonus. Calculate the total company bonus pool. Divide it by the number of employees you have. Write the checks. Boom!

I commend Dorota Shortell and the Simplexity team for having the courage to implement this simple—yet radical—idea. When CEOs get multi-million-dollar cash bonuses and have total compensation 1,000 times higher than the average employee, it can be hard to talk about being “One Team” with a straight face.

Does your company have a corporate bonus plan? If so, does it enhance alignment or create divisions?

SHIFTPOINTS® helps companies unleash the accelerating power of alignment.

Because alignment is the ultimate competitive advantage.

Note:  This is an excerpt from my latest book, Drive One Direction: How to Unleash the Accelerating Power of Alignment. In the EveryOne chapter, we highlight companies who unleashed the accelerating power of alignment with an intense focus on talent management disciplines. 

Cirque du Soleil (www.cirquedusoleil.com) is a global entertainment company. It has grown from an eclectic group of twenty street performers to a private-equity-owned company with over 4,000 employees, including 1,300 artists from more than 50 different countries.

Cirque du Soleil unleashed the accelerating power of alignment with One 101.

You could argue that Cirque du Soleil faces the ultimate alignment challenge:

How do you align a bunch of clowns?

Right this moment, thousands of people—none of whom are in the circus business—are thinking, “my sentiments exactly!”

Every company has a diverse workforce, but Cirque might top the list. They employ actors, singers, dancers, musicians, acrobats, gymnasts, swimmers, tumblers, jugglers, divers, mimes and, of course, clowns.

In addition, they are truly an international community, which creates unique cultural and language barriers.

All newly hired entertainers go to Cirque’s International Headquarters in Montreal for preparatory training. Training can last anywhere from a few weeks to a few months.

You might think of it as Circus of the Sun 101.

Cirque’s onboarding program is a full-immersion experience. Not only do the new entertainers train together, they live together in the artists' residence right across the street from headquarters.

Every company has some kind of onboarding program. For most companies, it is “hire and hope.”

When you think of situations where life-or-death teamwork is required, most people think of a military environment like the Navy SEALs or the Blue Angels.

But Cirque’s performances involve a high degree of risk. Therefore, their “boot camp” instills a high level of camaraderie, discipline, and trust.

Having One 101 is a key component how they align EveryOne … from Day One!

Does your company have One 101 that is mandatory for EveryOne?

P.S. I was so intrigued by this amazing company that I decided to click on the “Job Openings” link on their website. Much to my amazement, I learned that they had an opening for a “middle-aged physical actor.”

So, if this alignment thing doesn’t work out …

Note:  This is an excerpt from my latest book, Drive One Direction: How to Unleash the Accelerating Power of Alignment. In the EveryOne chapter, we highlight companies who unleashed the accelerating power of alignment with an intense focus on talent management disciplines. 

23andMe (www.23andme.com), based in Mountain View, California, has over 500 people and more than 5,000,000 customers. As one of the leaders in DNA testing, they have an interesting headline on their career page.

Join our gene pool.

The name 23andMe refers to the fact that human DNA is organized into 23 pairs of chromosomes. They offer a web-based service that helps people understand what their DNA says about their health, traits, and ancestry.

The process starts with a simple saliva sample. 23andMe then extracts DNA from cells in your saliva sample, processes the DNA on a genotyping chip, analyzes your genetic data, and generates a personalized report.

As you might imagine, one of their core values is “We ♡ DNA!” Here is how they explain it:

“Deciphering the human genome is the most exciting scientific discovery of our lifetime. A secret code in each of us! There is spectacular human diversity in the world and we celebrate and embrace it. We want to empower everyone to understand the genome and what it means for each of us. We believe anyone—yes, anyone—can learn about and understand their DNA. We want to bring innovative research and products to both scientists and consumers that make them as excited about their DNA story as we are!”

Of course, they look to hire people who share their company’s unique DNA:

“It’s our goal to bring innovative thinkers and top-notch talent together to make a difference in people’s lives. If you're committed to our vision of helping people access and learn from their genetic data and want to be a part of a mission-based culture, we want you to join our gene pool.”

Consider this: 99.9 percent of human DNA is common to all human beings. Imagine—there are over seven billion people of all shapes, sizes, heights, weights, sexes, and colors on the planet—and our DNA is 99.9 percent alike.

Thus, only one tenth of one percent of the DNA sequence is unique to each individual.

One tenth of one percent!

We believe that each company—like each person—has a unique DNA. So, the hiring process starts with clearly identifying your company’s unique DNA. While there is a standard definition for human DNA, there isn’t one for corporate DNA.

In 1998, Gareth Morgan published a book called Images of Organization. It was the first to apply the concept of DNA to corporate culture. Since then, several other authors and consultants have also used the term with a multitude of meanings.

Whereas Blommer Chocolate’s founders literally shared the same DNA, most companies must go through the process of codifying theirs. Your company’s unique DNA is the thing that uniquely identifies “your kind of people.”

So, to join 23andMe’s “gene pool,” you will have to match their unique corporate DNA.

Has your company codified your unique DNA?

Note:  This is an excerpt from my latest book, Drive One Direction: How to Unleash the Accelerating Power of Alignment. In the EveryOne chapter, we highlight companies who unleashed the accelerating power of alignment with an intense focus on talent management disciplines. 

Every company wants everyone to be aligned.

But most are focused on engagement.

Dozens of companies have developed surveys to measure employee engagement. These are often tied to the multitude of “Best Places to Work” awards.

When you evaluate the questions in employee engagement surveys, most focus on things like company benefits, work/life balance, and the quality of the coffee.

While it is good to have employees who are engaged, it is infinitely more important that they are aligned. After all, highly engaged employees can still be driving in the wrong direction.

There are many things that you want everyone to align with. For example, you want everyone to:

• Align their behaviors with your company’s code.
• Align their customer interactions with your company’s brand promise.
• Align their decisions with your company’s strategy.
• Align their actions with your company’s way.
• Align their goals with your company’s goals.

Of course, this assumes that you have clearly defined all those things.

After all, how can you hire people who are aligned with your vision if your vision is blurry? How can you train people to accomplish your mission if you don’t know what it is? How can you incentivize people to deliver your brand promise if you don’t have one?

That is why we have spent the last eleven chapters emphasizing the importance of clarifying those things.

My next posts will explore how 23andMe, Cirque du Soleil, McKinsey, Publix, Simplexity, and the American Red Cross implemented corporate talent management disciplines to align EveryOne.