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Tag Archives: Business Transformation

Decision Matrix for Platform Scaling Strategy

19 Apr

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The phenomenal success of tech innovators using Platforms has spurred a desire in companies, from a greater variety of sectors and markets, to gain advantage of Product to Platform Transformation.

This Transformation is based on the need to model businesses on a Customer-Centric Design approach.  The need has arisen because the concept of Economies of Scale has become archaic and has been taken over by Economies of Unscale.  Each customer is now being offered customized products and solutions.

The phenomenal success, by the trailblazing tech innovators, was achieved partly by deploying Platform Scaling that enabled Business Transformation and monopolization of the market.  Though, this monopolization and questionable use of the Platform, especially data generated therefrom, saw attempts to regulate these tech companies—making the decision to scale a complex one.  Understanding the intricacies of Platform Scaling is thus critical to the development and deployment of any Platform Strategy.

When considering Platform Scaling Strategy, there are 2 key aspects that are of utmost significance:

Regulatory Complexity

Regulatory Complexity means present level of legal and regulatory impediments that govern Platform entry and operation in a sector.

Regulatory Risk

Regulatory Risk refers to the probability of an upsurge in Legal and Regulatory Costs and Complexity in the future.

Some equitable and measurable metrics for calculating Regulatory Risks do exist but generally it is extremely challenging to predict policy outcomes or even ascribe odds to various outcomes.

A straightforward approach for Platform owners and operators to understand and evaluate the prospective combinations of Regulatory Complexity and Risk is to create a 2×2 matrix of high vs. low for the 2 factors.

Regulatory Complexity and Risk are turning out to be the determining factors in the strategic decision between Fast and Slow Scaling.

Fast Scaling, which has also been referred to as Blitzscaling, requires choosing speed over efficiency.  Fast Scaling has the strategic objective of growing briskly, experimenting swiftly to tweak product-market fit, and taking advantage of robust network effects to achieve and maintain a leading market share.

Fast Scaling is required to activate 3 interconnected positive feedback loops:

  1. Network Loop
  2. Data Loop
  3. Capital Loop.

Slow Scaling is the most sensible strategy in areas with both High Regulatory Complexity and High Regulatory Risk.  Slow Scaling does not disregard the quest for network effects, which are a requirement for success of platform businesses, but it gives preference to analysis, constant growth, and risk curtailment instead of speed.

Platform businesses functioning in High-Risk, High Complexity situations may evade pitfalls by employing 4 key components of Slow-Scaling strategy:

  1. Analysis of the Macro Environment
  2. Careful Risk Management
  3. Investment in Stakeholder Trust
  4. Incremental Geographic Expansion.

Let us now delve a little deeper into the various permutations of Regulatory Complexity and Risk, quadrant-wise, in the matrix.

QUADRANT 1

Regulatory Risk              Regulatory Complexity

Low                                        Low

Compliance costs are comparatively low in such situations and there are no serious deliberations among regulators and policy makers concerning restrictions on business models or operations.

The Strategy in this case is to Scale Fast.

QUADRANT 2

Regulatory Risk             Regulatory Complexity

Low                                        High

Sectors in such scenarios are highly regulated e.g., financial services sector.  Significant workforce is employed in governance, risk management, and compliance activities.  Entering such markets necessitates careful consideration of Regulatory Complexity.

The strategy in such scenarios is to Scale Fast.

QUADRANT 3

Regulatory Risk             Regulatory Complexity

High                                       Low

Operations are generally in a Regulatory void—i.e., no established and powerful regulatory authority, tight net of rules, or strict barriers to entry.  There is a great degree of ambiguity regarding how regulators may react.  Environment in such markets makes it difficult for businesses to mature discrete policy scenarios, allocate probabilities, and make strong assumptions on timing.

Strategy is to Scale Fast in such environments.

QUADRANT 4

Regulatory Risk             Regulatory Complexity

High                                       High

There is high Regulatory Complexity, such as unclear approach by various regulators in the various markets.  There are strong chances of sudden change in regulator and policy maker’s approach due to a particular incident.  Precipitous increase in entire sector’s Regulatory Risk triggered by events is highly likely.

The most sensible strategy in such cases is to Scale Slow.

Interested in learning more about the permutations of these 2 Scaling Strategies, areas of strategic focus, and the 4 components of Slow Scaling Strategy?  You can download an editable PowerPoint on Platform Scaling Strategy here on the Flevy documents marketplace.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.  Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market.  They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Successful Business Transformation—5 Critical Success Factors

29 Mar

Stock Image 2 - Business Transfromation CSFs

Business Transformations have become a necessity in the fast-changing technological and competitive business environment.  Transformation is characterized by significant and risk-laden Restructuring of a company, with the objective of accomplishing Operational Excellence and changing its future course.

Business Transformation is a priority for many top executives but it is usually a reaction to challenging circumstances rather than being a preemptive measure.

Business Transformation is prompted by a combination of 2 situations:

  • Need to address inherent problems causing organizational drag—these problems may be internal and/or external.
  • Aspiration by the top management and other senior stakeholders to seize the occasion of addressing these problems, in ways that deeply alter the Business Model of the organization including Value Creation.

Business Transformation entails not just making incremental changes but fundamentally changing all or some of the following:

  • Organizational Structure
  • Core Product or Service Portfolio
  • Systems
  • Processes
  • People—the way employees work
  • Technology

Undertaking such arduous effort requires approaching the task in a structured way.  Research shows that quite a few of such undertakings are based on anecdotal beliefs instead of being based on empirical data.

Countering this trend, the Boston Consulting Group conducted an empirical study of financial and non-financial data-set comprising 300 U.S. public companies.  The data spanned a period of 12 years from 2004 to 2016.  Selection was based on the following criteria:

  • Companies that had a $10 billion or more market capitalization between 2004 and 2016.
  • Of these, companies with an annualized deterioration in Total Share-holder Return (TSR) of 10% or more relative to their industry average (2 years running or more) were identified.

Based on extensive analysis—that included use of methodologies like trained proprietary algorithms, prediction models, and Multivariate Regression Analysis—a pattern pertaining to Business Transformation emerged.  The pattern depicted the following themes:

  1. Frequency of Failure
  2. Impact of Digital Disruption
  3. Impact of Downturn
  4. Competitive Volatility

The study also suggested the following 5 evidence-based Critical Success Factors (CSFs) for achieving Transformation Success.

  1. Cost Management (drives short-term success)
  2. Revenue Growth (drives long-term success)
  3. Long-term Strategy and R&D Investment
  4. New, External Leadership
  5. Holistic Transformation Programs

Let us examine in a bit more detail some of the CSFs.

Cost Management

In order to launch the Transformation effort on the correct footing, Cost Management is key, in the short term especially.  Predictably, empirical analysis suggests that the leading driver for organizations recovering from severe TSR deterioration is a determined Cost-cutting effort during the 1st year of Turnaround.  By year 3, Cost Reduction is accountable for the major share of TSR growth as companies divert their portfolios and make available funding for growth investments.

Revenue Growth

Merely short-term operational improvements do not augur well for a sustainable Transformation.  There has to be a long-term Growth Strategy put in place.  For this to happen, leaders have to challenge the foundations of the company’s Business Model.

Research divulges that Revenue Growth progressively becomes the driver for TSR recovery after year 1 in all the successful Transformation efforts.  Revenue Growth overshadows, by far, all the initial drivers for TSR recovery by year 5 of all successful Turnaround efforts.

Long-term Strategy and R&D Investment

Turbulent competitive environments, particularly, require long-term Strategic Planning and investment in Research and Development for fruitful Business Transformations.  Empirical research and analysis demonstrates:

  • A 4.8% difference between Transforming companies showing above-average long-term strategic direction compared to companies with a below-average orientation.
  • More pronounced findings in transforming companies operating in turbulent competitive environments—long-term orientation linked with a TSR increase of 7%.
  • Companies with above-average R&D investments had upwards of 5.1% TSR impact in contrast to those with below-average spending.

These CSFs strengthen the odds of success in Business Transformation individually.  When used together, most of them produce an impact that is larger than the totality of their individual parts.

Interested in learning more about the 5 Critical Success Factors for Successful Business Transformation?  You can download an editable PowerPoint on 5 Critical Success Factors for Successful Business Transformation here on the Flevy documents marketplace.

Want to Achieve Excellence in Business Transformation?

Gain the knowledge and develop the expertise to become an expert in Business Transformation. Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. Click here for full details.

“If you don’t transform your company, you’re stuck.” – Ursula Burns, Chairperson and CEO of VEON; former Chairperson and CEO of Xerox

Business Transformation is the process of fundamentally changing the systems, processes, people, and technology across an entire organization, business unit, or corporate function with the intention of achieving significant improvements in Revenue Growth, Cost Reduction, and/or Customer Satisfaction.

Transformation is pervasive across industries, particularly during times of disruption, as we are witnessing now as a result of COVID-19. However, despite how common these large scale efforts are, research shows that about 75% of these initiatives fail.

Leverage our frameworks to increase your chances of a successful Transformation by following best practices and avoiding failure-causing “Transformation Traps.”

Learn about our Business Transformation Best Practice Frameworks here.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market.  They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions.  I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power.  For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients.  In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over!  The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Strategic Human Resources: Evolution of Competition

20 Feb

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Today’s information-based, knowledge intensive, and service-driven economy has forced organizations to make substantial changes to the way they compete.  Changing perspective and responsibility of top management amidst rapid Business and Digital Transformation and the shifting role of HR from being an auxiliary function to that of a driver are some of the dynamics of the evolved competition.

This evolution of Competition has been reached by passing through 3 phases:

  1. Competition for Products & Markets
  2. Competition for Resources & Competencies
  3. Competition for Talent & Dreams

Throughout the evolutionary phases of competition, the focus of Growth Strategy, the tools used, and the key strategic resources have been shifting.  The strategic objective of front-running organizations is on continuous evolution and Transformation, and motivated Human Capital is their key resource.  This realization is now at the forefront of Strategy Development as competition for scarce Talented Human Resources becomes more intense.  However, modern-day managers are still using old tools to deal with an emerging reality.

Dexterity in leadership and management is a prerequisite for leaders now.  Research suggests that the 3 important changes that the CEOs must make in terms of their strategic perspective are in:

  1. Strategic Resources
  2. Value Creation and Distribution
  3. Role of Senior Leadership

More on this topic in our editable PowerPoint presentation on Strategic Human Resources.

With the fast-changing focus in Strategy, Human Resource Managers are finding themselves leading the strategic charge.  However, a large majority is ill prepared for the role.  With Human Capital becoming key strategic resource and basis of Competitive Advantage, HR must adopt 3 core processes to evolve into the strategic HR function that has become their new realm:

  1. Building
  2. Linking
  3. Bonding

Let us delve into the first 2 core processes to strategic HR function in a little more detail.

1. Building

The first core process of Building is all about creating human resource systems, processes, and culture to counter the deep-rooted bias towards financial assets and recognize the value of Human Capital.  For instance, Microsoft annually scans the entire pool of 25,000 U.S. computer science graduates for the best 500 to be given offers, of which 400 – top 2% of that year’s graduates – accept.  This only fills 20% of the positions.  For the rest, Microsoft maintains industry linkages with 300 recruiting experts who scour the industry for the best and the brightest individuals, often wooing them for years.

2. Linking

Developing Knowledge Sharing Networks is core to leveraging Human Capital.  Converting individual expertise into embedded intellectual capital is what linking is all about.  For example, British Petroleum in the 1990s introduced the Knowledge Management and Organizational Learning program.  The main feature of the program was the “Peer Assist” where frontline workers in one location would help solve a problem for workers in another location without the usual hierarchy intervening.  Peer Assist was augmented by the “Peer Groups” of business units—i.e. business units engaged in the same assisting activities as frontline individuals.  This way managers of decentralized operations compare experiences and share ideas.  Once this Information Sharing Network took root it was supported by setting up information-sharing infrastructure – e.g., video conferencing, chat rooms, video clip encoders etc.

Interested in learning more about the details of the 3 Core Processes required to evolve your HR into a strategic HR function and Key Actions needed to implement these?  You can download an editable PowerPoint presentation on Strategic Human Resources here on the Flevy documents marketplace.

Want to Achieve Excellence in Human Resource Management (HRM)?

Gain the knowledge and develop the expertise to become an expert in Human Resource Management (HRM). Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. Click here for full details.

The purpose of Human Resources (HR) is to ensure our organization achieves success through our people. Without the right people in place—at all levels of the organization—we will never be able to execute our Strategy effectively.

This begs the question: Does your organization view HR as a support function or a strategic one? Research shows leading organizations leverage HR as a strategic function, one that both supports and drives the organization’s Strategy. In fact, having strong HRM capabilities is a source of Competitive Advantage.

This has never been more true than right now in the Digital Age, as organizations must compete for specialized talent to drive forward their Digital Transformation Strategies. Beyond just hiring and selection, HR also plays the critical role in retaining talent—by keeping people engaged, motivated, and happy.

Learn about our Human Resource Management (HRM) Best Practice Frameworks here.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

5 Critical Success Factors of Strategic Restructuring

11 Feb

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Reorganization becomes essential at some stage in the lifecycle of any organization.  In order to emerge triumphant through this tumultuous challenge, it is necessary that the focus remains on the challenges impeding the organization, thorough Strategic Planning to tackle the challenges, and prioritizing strategic initiatives to deliver effective Business Transformation.  Strategic Restructuring has the capability to deliver these results.

When the word “Restructuring” pops up, the foremost idea that comes to mind is achieving Cost Reduction by minimizing payroll costs—predominantly by cutting back on the headcount.

Scores of organizations have suffered because, in the melee of headcount reduction, the most competent employees quickly found opportunities elsewhere, leaving inappropriately competent employees behind, resulting in a crippled organization.

The purpose of Restructuring is to make the organization profitable, efficient, and effective.  Headcount reduction should be a consequence of the Restructuring initiative and not the prime objective.

To avoid an outcome that debilitates the organization as a result of Restructuring, it is absolutely essential to keep an eye on the Critical Success Factors (CSFs) while the organization moves through the 4 phases of Strategic Restructuring.  Strategic Restructuring’s 5 CSFs include:

  1. Strategic Focus
  2. Continuous Communication
  3. Participative Focus
  4. Positions before People
  5. Focus on Competency

Experts suggest envisioning a “Future State” for the organization, to be achieved through a robust Strategy that includes Change Management, implemented by the most competent employees who are redeployed.  The rest of the employees either severe ties voluntarily or are laid off—ideally with a good severance package or a job placement, with the organization’s help, somewhere else.

Leadership has to ensure firm resolution in employing these Critical Success Factors in order to establish its role and build a constituency among employees who believe in the need for change.  Let’s dig deeper into the 5 CSFs of Strategic Restructuring.

1. Continuous Communication

  • Communication is a decisive factor in Strategic Restructuring. Pitfall in this factor is the “need to know” approach.  Top-level leadership should be communicating with the whole organization quite frequently.
  • Immediate and full disclosure of information builds trust in the management’s actions.
  • Repetition is key in getting the message across. Believing that enunciating once is enough, will be erroneous on the leadership’s part.

2. Participative Focus

  • Redesign of structure is a bottoms-up job because the information and expertise are dispersed throughout the organization.
  • Employees in the thick of the action are in the best position to undertake this effort.
  • The management develops the organizational framework and keeps apprising the employees regarding the overall strategy in order to keep the direction true.
  • A participative approach to Restructuring assists in building employee morale and engagement levels.

Interested in learning more about the Restructuring’s Critical Success FactorsTransformation Phases, and a Case Study on Restructuring?”  You can download an editable PowerPoint on Strategic Restructuring: Critical Success Factors on the Flevy documents marketplace.

Want to Achieve Excellence in Business Transformation?

Gain the knowledge and develop the expertise to become an expert in Business Transformation. Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. Click here for full details.

“If you don’t transform your company, you’re stuck.” – Ursula Burns, Chairperson and CEO of VEON; former Chairperson and CEO of Xerox

Business Transformation is the process of fundamentally changing the systems, processes, people, and technology across an entire organization, business unit, or corporate function with the intention of achieving significant improvements in Revenue Growth, Cost Reduction, and/or Customer Satisfaction.

Transformation is pervasive across industries, particularly during times of disruption, as we are witnessing now as a result of COVID-19. However, despite how common these large scale efforts are, research shows that about 75% of these initiatives fail.

Leverage our frameworks to increase your chances of a successful Transformation by following best practices and avoiding failure-causing “Transformation Traps.”

Learn about our Business Transformation Best Practice Frameworks here.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd



Restructuring: Assessment Processes and Methods for Redeployment

8 Jan

Stock image 2 - Redep assessment process & methods

Organizations that have survived over time have had to reinvent themselves over and over with the changes in the environment.  These Business Transformations almost always include Cost Reduction that tend to lean towards Headcount Reduction.  Headcount Reduction is typically achieved using 2 approaches:

  1. Downsizing
  2. Restructuring

Downsizing keeps the fundamentals of the roles same with only fewer people performing those roles.  Whereas, Restructuring creates new roles, as well as modify existing roles, requiring a new mix of skills or altogether new resources to perform them.

Restructuring presents a more challenging task in that a new mix of skills has to be identified for each role, an Assessment Process has to be set up to assess existing employees against new competencies, and Redeployment after Restructuring (or new recruitment) done.

The important question in both scenarios is:  Who should we eliminate and who should stay?

The question can be answered by devising and using key criteria to evaluate and then choose the most relevant assessment method.

Assessment of employees is key in both Downsizing as well as Restructuring.  The Assessment Process has to be vigorous enough to identify the right employees to keep and lay off.  A broader assessment process ensures coverage of more aspects of a new role which in turn makes the assessment process fairer.  Measures, in this regard, may include:

  • Covering a broad range of competencies in the interview process rather than concentrating on a few specific competencies.
  • Using a mix of relevant performance data from the last role as well as some elements of future-oriented assessment, such as role plays or OPQs.
  • Taking input from Line managers.

Linkage of the entire assessment process to the requirements of the job is the crucial part of this phase.

As with any assessment system, the content and design will be settled through consideration of various factors, some practical like cost, logistics and some more about safeguarding the output like instrument validity.  When taking into account assessment tools for incorporation in the process it is beneficial to examine them against following criteria:

  • Coverage of range
  • Accuracy
  • Relevance
  • Freedom from bias
  • Acceptability
  • Practicality

The tools, based on the above criteria, help in various assessment methods that gather information on different aspects pertaining to the elements of the new roles.  The most widely used Assessment methods include:

  1. Existing Performance Management Data
  2. Line Manager Performance Ratings
  3. Competency Based / Behavioral Interviews
  4. Personality Measures (OPQ) Linked to Competencies
  5. Simulation Exercises
  6. Pertinent Employee Data

Let us examine the methods in a little more detail.

Existing Performance Management Data

There are various benefits of using this employee assessment method, such as:

  • No additional data gathering is required since the data is already in place.
  • Such existing data can be obtained speedily and effortlessly.
  • Existing performance data is perceived as pertinent.

There are some drawbacks associated with the existing Performance Management data method that executives should be mindful of:

  • The data is often inconsistent and may vary in quality.
  • Does not provide clear distinction between people.
  • Does not reflect behavior therefore difficult to base decisions on.
  • Usefulness depends on extent of overlap with the new role.

Such data although convenient and easy to obtain, has to be augmented from other sources—and through other assessment methods—for a complete picture to base the employee selection decision on.

Interested in learning more about Redeployment Assessment Process & Methods?  You can download an editable PowerPoint on Restructuring: Redeployment Assessment Process & Methods here on the Flevy documents marketplace.

Want to Achieve Excellence in Business Transformation?

Gain the knowledge and develop the expertise to become an expert in Business Transformation. Our frameworks are based on the thought leadership of leading consulting firms, academics, and recognized subject matter experts. Click here for full details.

“If you don’t transform your company, you’re stuck.” – Ursula Burns, Chairperson and CEO of VEON; former Chairperson and CEO of Xerox

Business Transformation is the process of fundamentally changing the systems, processes, people, and technology across an entire organization, business unit, or corporate function with the intention of achieving significant improvements in Revenue Growth, Cost Reduction, and/or Customer Satisfaction.

Transformation is pervasive across industries, particularly during times of disruption, as we are witnessing now as a result of COVID-19. However, despite how common these large scale efforts are, research shows that about 75% of these initiatives fail.

Leverage our frameworks to increase your chances of a successful Transformation by following best practices and avoiding failure-causing “Transformation Traps.”

Learn about our Business Transformation Best Practice Frameworks here.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives.  Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd

Strategic Goals Grid (SGG) – Another tool for Strategic Planning

2 Oct

One of the most popular Strategic Planning tool among executives is the SWOT analysis (or SWOT matrix).  However, sometimes assessing the organization’s Strengths, Weaknesses, Opportunities, and Threats is not enough to set the direction for the planning process or to implement Business Transformation.

An alternative framework to SWOT analysis is the Strategic Goals Grid (SGG).  The SGG gives planners a different perspective to view the organization, the direction it has taken, the course that the collective wisdom of the organization wants to take, and to set goals.  SGG is an extremely effective overall Organizational Analysis tool for senior leaders responsible for Planning, Strategy Development, Transformation, Growth, and Profitability.

SGG is a 2×2 matrix, fashioned by examining the “Yes” and “No” answers to 2 critical questions:

  • Do you want something?
  • Do you have it?

The combination of the “Yes” and “No” answers to these questions define 4 basic categories for goals and objectives:

  1. ACHIEVE – if you want something you do not have, your goal is to obtain it.
  2. PRESERVE – if you want something you already have, your aim is to keep it.
  3. AVOID – if there is something you do not want and do not have, your goal is to avoid it.
  4. ELIMINATE – if there is something you do not want but have, your goal is to get rid of it.

These 4 categories of goals—ACHIEVE, PRESERVE, AVOID, and ELIMINATE—constitute the Strategic Goals Grid when drawn on a 2×2 grid.

The Strategic Goals Grid can be used to facilitate discussions and to record and communicate the results of such discussions.  Individuals can complete the grid separately and then compare, discuss, and integrate their individual efforts into a consolidated matrix.

SGG can be employed for kick-starting the Strategic Planning process in 3 progressive steps:

  1. Visualize and Document
  2. Coalesce
  3. Synthesize and Align

Let us dig a little deeper into the individual framework steps.

Visualize and Document

The 1st step in formulating the Strategic Goals Grid is an individual exercise, which takes about 15 minutes to accomplish.  The step entails taking input from all relevant participants of the Strategy Development workshop.  The activity requires from the participants to write their responses on individual copies of the Strategic Goals Grid.  The participants record their input regarding the critical questions of what to ACHIEVE, PRESERVE, AVOID, and ELIMINATE.

The question, “What do we want to eliminate?” is very effective in triggering group discussions on any issues that exist across the organization.  The question, “What do we want to avoid?” focuses the group’s discussion to anticipated issues and/or threats to the organization.

Coalesce

The 2nd step is a group activity, where the strategy development group engages in an exercise in which individual responses gathered during the first step are shared with the participants.  The individual responses are projected on a large screen and recorded on a computer.  Using one quadrant at a time, the group evaluates the list and repeats this process for all quadrants.  The list of individual responses becomes the collective wish list or the collective wisdom accrued over a period based on realities faced on-ground.

Synthesize and Align

The 3rd step is also a group exercise that entails rationalizing the responses gathered in the previous steps through discussion and analysis.  The list is carefully scrutinized and trimmed considering the objectives for the future.  These objectives are aligned with the priorities and values embodied by the organization.  The list of individual responses are refined and a consensus is developed on the finalized list.

Interested in learning more about the Strategic Goals Grid, its utilization, benefits compared to SWOT Analysis, and how to populate the grid? You can download an editable PowerPoint on the Strategic Goals Grid (SGG) here on the Flevy documents marketplace.

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“Strategy without Tactics is the slowest route to victory. Tactics without Strategy is the noise before defeat.” – Sun Tzu

For effective Strategy Development and Strategic Planning, we must master both Strategy and Tactics. Our frameworks cover all phases of Strategy, from Strategy Design and Formulation to Strategy Deployment and Execution; as well as all levels of Strategy, from Corporate Strategy to Business Strategy to “Tactical” Strategy. Many of these methodologies are authored by global strategy consulting firms and have been successfully implemented at their Fortune 100 client organizations.

These frameworks include Porter’s Five Forces, BCG Growth-Share Matrix, Greiner’s Growth Model, Capabilities-driven Strategy (CDS), Business Model Innovation (BMI), Value Chain Analysis (VCA), Endgame Niche Strategies, Value Patterns, Integrated Strategy Model for Value Creation, Scenario Planning, to name a few.

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Digital Facilitation – Embrace the Future Work Environment

12 Sep

Stock Image 2 - Digital Facilitation Primer

In the wake of global pandemics when meeting face to face is not possible, it’s about facilitating workshops digitally, designing a formal agenda, and utilizing digital tools to ensure a productive virtual meeting.  Digital Collaboration Platforms have been pivotal in the current scenario.

As a matter of fact, Digital Collaboration platforms have become a new norm and have forever transformed business work environment.  Digital Facilitation tools are extensively used by facilitators, Change Management consultants, Organizational Development practitioners, and learning professionals as a way to collaborate on workshops, events, change initiatives, and learning programs.

Digital Workshop Facilitation can be categorized into the following 3 major types:

  • Virtual Facilitation

In this type of Digital Facilitation, a group collaborates remotely in real time but from different locations.  Common tools used are Zoom, GoToMeeting etc.

  • Asynchronous Facilitation

In this facilitation method, a facilitator leads participants remotely at a different time and place. Common tools include Email, Slack etc.

  • Face-to-Face Facilitation

In Face-to-Face facilitation, a facilitator interacts with a group of people in the same workshop space, in person.  Digital tools can be used in such a setup instead of flip charts and sticky notes.

The new scenario brings forth new challenges in workshop facilitation that necessitate robust principles, methods, and tools for the future work environment to run smoothly.  Understanding and adhering to the following best practices and principles in Digital Workshop Facilitation helps in attaining effective results just like face-to-face workshops:

  1. Specify well-defined guidelines and expectations.
  2. Form an assured environment to enable discourse.
  3. Ensure effective interaction before, during, and after a workshop.
  4. Ensure all voices are heard.
  5. Document the conversations.
  6. Alter the moderation approach based on the participants’ level of understanding.
  7. Seek comments and iterate.

Let us delve a little deeper into some of the principles:

1. Specify well-defined guidelines and expectations.

The remote nature of digital workshops limits the element of reacting to audience’s lack of attention.  This warrants clear instructions regarding ground rules, both in writing and orally to compensate for this disadvantage.  Participants need to use precise language in asking questions and answering them.

Instructions on technology and tools usage should be reiterated from time to time.

2. Form an assured environment to enable discourse.

Trusting participants in a virtual setting is difficult if you do not know them.  It is the digital facilitator’s job to create conversation security in different ways.  Spending time on icebreakers or other pre-engagement activities may ease the discomfort.  Providing quick and positive feedback to those who actively contribute encourages shy participants and creates a positive environment.  Informing the participants on how meetings are being documented and information on who has access to this documentation can reassure participants.

3. Ensure effective interaction before, during, and after a workshop.

Digital Facilitation platform can be used ahead of a meeting to help participants familiarize with each other, disseminate the agenda, initiate discussions, or obtain helpful information from the participants, such as questions, skill levels, ideas, etc.  Digital Collaboration Platform should be the center of post-workshop activities, e.g., sharing documents, closing agendas, answering additional queries, and extended discussions.

4. Ensure all voices are heard.

Digital Workshop tools can facilitate participation of people who in a traditional workshop setup will not be able to participate due to dominance by a few individuals.

Interested in learning more about the Digital Workshop Facilitation principles, methods, and tools? You can download an editable PowerPoint on Virtual Work Digital Facilitation (Primer) here on the Flevy documents marketplace.

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4 Imperatives of Transforming From A Product-based Business To Platform Business Model

19 Aug

Change1

Transformation from a product-based model to a platform model is a dream for many executives.  More and more product companies are now shifting into a platform model.  The drive behind such a shift is the huge success of platform companies—e.g., Amazon, Google, and Apple.  These organizations started out as a retailer, search engine, and iPod manufacturer respectively, but later transformed into platform models.

However, bringing this transformative vision into reality is anything but straightforward.  Research into successful platform businesses reveals that this necessitates a robust approach comprising the following 4 critical phases:

  1. Attractive Product and Customer Base
  2. Hybrid Business Model
  3. Rapid Conversion
  4. Identify and Seize Opportunities

Let’s dive deeper into the first two phases of the approach, for now.

Attractive Product and Customer Base

A platform model is not a remedy to resuscitate products that are on a downward slide.  It necessitates an attractive product that offers a significant customer base and value to help improve customer loyalty and resist rival offerings.  The critical mass of customers also allows the platform company to create value for—and attract—third parties that are crucial for the platform to flourish.

Qihoo 360 Technology, a large internet firm in China, commenced its operations in 2006 by selling an antivirus software, 360 Safe Guard.  To build a broad user base and to gather customers’ feedback on improving the product, the company started giving away the product free.  The company maintained a list of malware as well as a “whitelist” of programs that were safe for the users.  The critical mass of customers allowed Qihoo to:

  • Quickly identify viruses on scanning computers
  • Improve the antivirus
  • Introduce new products
  • Attract new customers
  • Create new platforms
  • Attract 3rd-party software companies to make Qihoo a channel for reaching customers.

Hybrid Business Model

The notion that an organization has to embrace either a product-based or a platform-based business model is far from reality.  Although, both the product-based and platform-based business models need a framework to assign dedicated resources and manage operations, however, Business Transformation from a product-based model to a platform-based model gets simplified utilizing a hybrid approach.  A product-based business model calls for organizations to have differentiated products catering to customers’ needs, to create value.  Whereas, a platform-based business model creates value by linking users to 3rd parties and charging fees for using the platform.  The focus of Platform models is on:

  • Inspiring mass-market acceptance
  • Increasing the number of interactions rather than meeting specific customer needs
  • Connecting users and 3rd parties to create competitive edge instead of relying solely on product differentiation (product model).

For example, Apple converted itself from a product model to a platform model within a year after the launch of the first iPhone.  Initially, Apple reacted defensively to any hacking attempts and precluded 3rd party apps on the iPhone, but then decided to create an open platform, and launched the App Store.  The hybrid model and platform mindset created additional income streams and significant revenue for Apple.

Rapid Conversion

To make a product and business model profitable, the conversion of product users into platform users is of utmost importance.  To enable this, an organization needs to develop its platform in such a way that it should present enough additional value for the customers to adopt it and become its users.  Three key elements are critical to accomplish this:

  • Deliver adequate value
  • Launch connected products consistent with the brand
  • Allow 3rd parties to perform upgrades

If the platform does not offer adequate value for the customers they are not going to embrace it the way they do to a great product.  Similarly, addition of new offerings that are coherent with the brand has a strong correlation with new platform adoption.  New offerings gain traction from a firm’s image and strengthen the brand further.  Likewise, allowing 3rd parties to make upgrades, improve product offerings, and develop the platform further helps in rapid conversion, additional revenue, and growth.

Interested in learning more about the phases of the approach to Products-to-Platforms Transformation?  You can download an editable PowerPoint on Products to Platforms Transformation here on the Flevy documents marketplace.

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Organizational DNA 101: A Guide to Defining Your Organization’s Behavior and Characteristics

3 Aug

Execution has become the new watchword in Boardrooms.  As organizations fail to effectively implement strategies, the importance of execution has risen to the forefront. Essentially, the first step in resolving these dysfunctions is to understand how the inherent traits of an organization influence and even determine each individual’s behavior. Organizations must also understand how collective behavior affects company performance.

The idiosyncratic characteristics of an organization can be codified using the DNA. When the DNA of an organization is purely configured, unhealthy symptoms and counterproductive behaviors are demonstrated.

Understanding the DNA and the Organizational DNA Framework

DNA has been used as a family metaphor to codify the idiosyncratic characteristics of a company.

The Organizational DNA Framework examines all aspects of company architecture, resources, and relationships.  It ensures that managers focus their efforts on reinforcing what works in the organization and modifying what does not. It helps companies identify and expose hidden strengths and entrenched weaknesses.

In identifying unhealthy symptoms and unproductive behavior, the Org DNA Profiler is used as a tool.  It allows management to gain insight into what is and is not working deep inside a highly complex organization.

The 4 Key Areas or Building Blocks

The Org DNA Profiler, as an Assessment tool, was used to fix problems by identifying and isolating them.  Launched in 2003, the Org DNA Profiler measures an organization’s relative strength in 4 Building Blocks on the basis of individual employees’ responses to 19 questions.

What Type of Organization Do You Have?

When diagnosing and overcoming organizational impediments, there is also a need to identify the type of organization that you have. There are 7 broad types of organizations; each organization fitting a certain type.

There is a Resilient Organization.  A Resilient Organization can adapt quickly to external market shifts.  It can remain steadfastly focused on and aligned with a coherent business strategy.  Resilient Organizations can anticipate changes routinely and addresses them proactively. They can attract motivated team players and offers a stimulating work environment, resources, and authority to solve tough problems.

However, there is also a disadvantage when it comes to Resilient Organizations. Resilient Organizations have the tendency to be overly adapted toward one direction or the other.

Another type of organization is the Just-in-Time Organization. The JIT Organization demonstrated an ability to turn on a dime when necessary, without losing sight of the big picture. They can manage to hold on to good people and performs well financially. A Just-in-Time Organization is a stimulating and challenging place to work.

While this may be a good place to work, it can also have its disadvantages. A Just-in-Time Organization is not proactive in preparing for impending changes. In fact, it has not made a leap from good to great. As such, it tends to miss opportunities by inches rather than miles.  It celebrates successes that are marginal rather than unequivocal.

The third type of organization is the Military Organization. This type of organization succeeds through sheer force of will of top executives. However, it has a shallow and short-lived middle management bench.

There are 4 other types of organizations. There can be the Passive-Aggressive Organization, the Fits-and-Starts Organization, the Outgrown Organization, and the Overmanaged Organization.

The Passive-Aggressive Organization is considered the most prevalent of all types of organizations. The Outgrown and Overmanaged Organizations, on the other hand, are those that are often considered unhealthy.

The intricacies and defining characteristics of the 7 types of organizations are effective in creating specific interventions to enhance performance and execution.  Knowing and understanding the types of organizations can better assist organizations in the analysis of their DNA and guide them in undertaking Business Transformation or Strategy Development.

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Understanding The Importance of Organizational DNA: 10 Core Principles

29 Jul

Organizations can change over the years. Change may happen because that is what the customers expect or it is because the organization gets to have even the most coveted skills. Despite the changes, there are those that stay the same—the organization’s brand, its unique culture, and its shared lexicon. These are the underlying organizational and cultural design factors that define an organization’s personality. Metaphorically, these are called Organizational DNA. The Organizational DNA can indicate whether the organization is strong or weak in executing strategy.

Today, execution has come to a fore as organizations fail to effectively implement strategies. Organizations now realize that it must first resolve this dysfunction by understanding how the inherent traits of an organization influence and even determine each individual’s behavior. The idiosyncratic characteristics of an organization can be codified using the DNA. When the DNA of an organization is purely configured, unhealthy symptoms and counterproductive behaviors are demonstrated. High performing organizations have shown that there are precepts that they closely follow to ensure that their Organizational DNA is in order.

The 10 Principles of Organizational DNA

The 10 Principles of Organizational DNA are the precepts upon which high-performance companies are built on.

Let us take a look at 5 of the 10 Principles of Organizational DNA.

  1. Organizations always identify with 1 of 7 behavioral patterns regardless of industry and geography. Enterprise-wide behavior can either be passive-aggressive, overmanaged, outgrown, fits-and-starts, just-in-time, military-precision, or resilient. The complication here is that companies can face and conquer even the most pernicious performance problems by changing personalities. When this happens, it is crucial that the company must be ready for any problems that may arise as a result of the change in personality type. The inability to address these problems may be detrimental to the organization. Changing personality is not easy. It must be well-studied and strategically planned.
  2. Companies contain a mix of personalities. Business units fall under different archetypes, particularly in major acquisitions. At this stage, it is possible that a resilient organization may have a division that matches the fits-and-starts profile, characterized by smart entrepreneurial talent. However, despite that, it may lack the collective discipline necessary.
  3. There is a strong connection between personality type and strategy execution. In the survey conducted, 48% of the respondents fit a profile that is distinguished by weak execution. Passive-aggressive organizations may have people who pay lip service to results but they may consistently undermine some necessary efforts.
  4. Strong execution can be sustained. Organizations with a strong execution archetype cannot afford to be complacent. Leaders must continually seek feedback from the market, encourage and act on criticism from customers and frontline employees, and take action to address minor issues. These must be done before any problem gets bigger.
  5. The combination of building blocks determines the organization’s aptitude for execution. Organization DNA is made up of 4 building blocks. These are decision rights and norms, motivation and commitments, information and mindsets, and structure and networks. Complications may come in when companies decide to improve execution. At this point, building blocks must be considered and these must be considered as a whole and not individually.

The other 5 core principles of Organizational DNA are essentially necessary. Even the company with the most desirable profile, the resilient organization, must continually stay at the top of the game. Hence, it is essential that organizations must adopt the most appropriate behavioral pattern and personality to be able to build high-performance organizations. Strategy Development must be able to integrate into the organization’s Business Transformation the 10 core principles of Organizational DNA.

Interested in gaining more understanding of these  principles of Organizational DNA?? You can learn more and download an editable PowerPoint about Organizational DNA: 10 Core Principles here on the Flevy documents marketplace.

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