Every great business starts with a purpose-driven strategy. Amazon, McDonald’s, Mac, Eggo Waffles all started with a unique idea and built a strategy around their idea to capitalize on their uniqueness in ways that no one else had yet.
As an executive, you’re aware of the importance of having a concrete purpose, and a strategy built around that purpose to determine your markets of competition, your target consumer base and how your company differentiates. But to get ahead in 2019, you need to evaluate how you’ve organized your business around this strategy and purpose.
As your company grows you add new employees, various business lines, new expectations from a larger band of customer groups and your brand crosses geographic thresholds. All that to say, as your company grows, alignment behind a single strategy becomes increasingly complex. And that can lead to inefficiency and derailment from target goals.
In fact, in a study conducted by Fierce, Inc. 97% of employees and managers believe that misalignment within teams directly impacted the results of a given project and a larger goal.
The need for strategy-first organizational alignment is not a new concept. In 1977, the Harvard Business School historian, Alfred Chandler published a foundation-altering book on strategic decision making in successful corporations. The book, The Visible Hand: The Managerial Revolution in American Business, pushed one central idea; “Unless structure follows strategy, inefficiency results.” Structure follows strategy, and as shifts in technology and markets alter a business strategy, its organization must follow suit.
The Alignment Value Chain of Success
Positioning the right people and aligning them behind a common strategic vision for a company may feel like an impossible task, but it is a key factor that separates successful companies from those that continue to miss the goals set as individuals, departments and the business quarter after quarter.
Businesses look for every advantage to fulfill their purpose (the why behind what they do). To do so, they must hire the right people, train them to adopt the company’s purpose and chart a course for personal success that also results in the company achieving their goals.
Capturing purpose and strategy on paper is one thing, but educating, getting buy-in, and ultimately adoption by your entire staff (no matter the size) can be one significant feat. Not to mention tracking progress.
In a Harvard Business Review article, Jonathan Trevor and Barry Varcoe write that alignment is maximized through a value chain that connects strategy. The value chain answers five questions:
- Purpose: What do we do and why do we do it?
- Business Strategy: What are we trying to win to fulfill our purpose?
Organizational Capability: What do we need to be good at to win?
Resource Architecture: What makes us good at these things and how good are we?
Management Systems: What delivers the winning performance we need?
These five links are the cornerstones of not only strategy-focused alignment but of maximizing economies of scale. Remember brands like Nike, McDonalds, Amazon or that small website Facebook? Of course you do, and it’s because they capitalized on the alignment value chain of success, it’s baked into their design. As their market grows, as they scale across geographic borders, as technology changes they pay obsessive attention to the details surrounding their the design and management of their structure and processes as they relate to their overall business strategy.
What you need to assess your organizational structure
Start by considering how rallied behind your strategy your team might be based on the following:
- Does the team know the purpose of the company?
- Does every person at the company have a clear understanding of what they are accountable for?
- Do they feel a sense of responsibility to see it to completion?
- Are the people that need to work together to achieve success able to do so?
In the Growth Institute’s Rockefeller Habits Checklist, the first habits center on executive and full team alignment. They start by surveying your team. Does the executive team understand each other’s needs and processes? Do they meet for weekly strategy brainstorms? Do they participate in ongoing executive education? The executive team is responsible for a better, up-to-date organizational structure and goal setting. They are the foundational piece in improving strategy-first alignment.
Behind that is goal setting. As we mentioned earlier, when organizations scale they often get more complex and team goals begin to splinter. Make sure that everyone is aligned behind a #1 priority: The one thing that needs to happen and what their part is in that conquest.
If the company is organized in such a way that individuals feel a sense of accountability, and that they have what it takes to move the company forward, then your structure and strategy are likely aligned. But how can you be sure?
What gets measured gets managed
~ Peter Drucker, Management Expert
Monitoring and measuring the progress toward the goals set is the data necessary to determine with a more confident level of certainty that you truly have structured the team for success.
Ahead of every quarterly strategic planning and goal setting session, our team uses the alignment checklist linked below, popularized by the Rock Habits, as a diagnostic for our company alignment. It helps us see how we progressed last quarter and identify areas we should focus on or address for the coming quarter. This is a great tool for everyone on the team – not just upper management – to gauge how aligned they feel the company is. It highlights potential areas of concern and things we are doing particularly well. We average the scores of each person in the company to get data points around our alignment – it takes the anecdotal nature of alignment out of the picture.
As you go through the assessment, reach each statement and rate your company on a scale of 1-10 to determine areas of strength and those that need improvement when it comes to key functions of the business – Communication, Execution, and Planning. Based on your score, we’ll share resources and recommendations you can use with your team to address the areas needing improvement. You can also print out the checklist and share with your team here.