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Articles - “Why Breakthrough Initiatives Fail”
by Ted Santos
At some point in most companies, the CEO and Board of Directors have an initiative or
legacy process to implement. However, many hesitate for a variety of reasons:
- Staff will not understand
- Staff and management are not ready
- The initiative is too disruptive
- It’s just not the right time
Why should a breakthrough initiative that could drive new revenue and create a
competitive advantage be delayed? According to Pellettiere (2006), 70 percent of CEO
initiatives fail, and this trend will continue unless leadership can develop tools to gain
enterprise wide alignment or identify the source of derailed initiatives.
Assessing an organization’s readiness to execute initiatives, including competitive
intelligence, is a way to take a snap shot of the state of a corporation. Every company
has a culture that supports the Board and CEO. However, several cultures coexist. In
fact, many people cannot articulate these sub-cultures. It may be the unspoken policies
that dictate behavior and outcomes.
Uncovering unspoken policies helps leaders understand the perceived threats and
weakness employees face as well as ignored strengths. In addition to identifying internal
circumstances, it exposes external opportunities. When employees are engaged in the
new initiative before it is implemented, employees are more likely to buy in to it. They
can also connect the dots between the initiative and unmet needs in the marketplace.
Measuring Readiness
Employees also hold intellect capital to create new revenue streams or implement
significant cost cutting measures that create a competitive edge. By assessing an
organization’s preparedness for any large initiative, leaders have created more efficient
processes to enhance the customer experience and to differentiate the enterprise from
competitors.
By measuring an organization’s readiness, leaders can both generate enterprise-wide
alignment and mitigate the risk of an initiative failing. Businesses can create initiatives
that drive new revenues while navigating through an environment of constant change by
applying competitive intelligence tools that provide internal market research.
On a broader scale, all institutions are committed to reaching their goals and objectives.
Unfortunately, the demands of the global economy can force them to make unforeseen
changes in the middle of an initiative. They are navigating through a much more complex
ever-changing community of technology, competitors, and customer demands than
some of the existing business models can support. The speed at which change is
occurring has caused chaos for many organizations. At the same time, it is an
opportunity to create a competitive advantage. For example, reduced time for go-tomarket
can make an enterprise a market leader in this economic environment.
Forecasting Behavior
For example, CEOs can gain insight and forecast their employees behavior and
perception, such as where push back is likely to occur and why. They can then tailor
their communications and correct factors that could disrupt the initiative. In addition,
identifying and leveraging informal champions increases the initiative’s momentum.
The Board and CEO require information that enables them to make decisions with a
clear understanding of what is happening inside the enterprise in the same way market
research is conducted to understand consumer behavior and needs. For example, when
Jerry Levin, former CEO of AOL time Warner, merged AOL and Time Warner, he never
gained by-n from his organization prior to the deal because he did not think they would
understand the vision. If he could have identified the factors that would derail the
initiative as well as the factors that would make it successful, he could have corrected
inherent weaknesses and leveraged inconspicuous strengths.
For these initiatives, it can be time consuming for the CEO and Board to correctly
identify potential problems. Personal interviews of employees to understand their
sentiment as well as perceptions toward a new strategy is a great, however, generally
not effective use of their time. In addition, they run the risk that employees are just telling
them that they want to hear. A more efficient way would be or the Board and CEO to
take a virtual walk through of the entire company. If they could automate and scale the
interviews, they could have a dashboard of the entire organization, whether there were
200 employees or 200,000.
Health Care Initiative Insight Purposes
- Provide a dashboard of the organization
- Provide decision makers with information they ordinarily couldn’t obtain.
- Forecast the level of readiness of staff and management to execute the initiative.
- Identify aspects of the company that work well so that an organization’s strengths
can be leveraged.
- Reveal informal champions who will spearhead the initiative.
- Foster an environment of open and honest communications.
- Engage staff and management in the new initiative.
- Evaluate the company’s human capital and predict if the initiative is likely to
succeed.
- Evaluate intellectual capital to expose unmet customer needs.
- Identify where push back will occur and why.
- Uncover where collaboration works, where it doesn’t and why.
- Inform leadership what staff and management need to be fully aligned on the
initiative.
- Retention of key personnel.
- Uncover untapped intellectual capital.
- Help the organization build human infrastructures for sustained growth and
innovation.
- Insight into the new skills and competencies required by leadership, staff and
management to successfully execute the initiative.
- Reduce time for go-to-market strategies.
A Health Care Example
For example, a health care company gained insight into how staff and management
would support or push back on an initiative that would drive new revenues and
differentiate them. The initiative was analogous to an auto mechanic providing a car
cleaning/detail service. Car cleaning would be supplemental and easy to provide
because they already have your automobile on the premises.
In the same way, the health care company had an unexploited opportunity to fulfill
additional needs of customers without spending money to acquire new clients. The
initiative would also require them to accomplish several smaller projects that would
increase efficiencies, reduce costs and gather marketable intelligence. In the future, that
intelligence would create additional revenues. (See side bar 1.)
Once leadership gained an understanding about what was happening in the company as
well as how staff and management could better serve customers, they were in a better
position to develop strategies and leverage employees prior to implementing the
initiative. Without an assessment of the entire organization’s acceptance, they would
have been in the position of assuming that staff and management would buy-in to the
idea.
The health care company’s assessment measured staff and management’s level of
preparedness to execute the initiative. However, the effort and time to run this
assessment requires that the initiative must impact the entire organization, drive new
revenues, or create significant cost cutting efficiencies. It measures the percentage of
the organization that is aligned with the initiative. While at the same time, it indicates the
percentage that is neutral or will push back and why. In the health care company
alignment had to start at the top.
Our outside team interviewed the Board before the assessment was applied to the rest
of the company. They discovered that the board had lengthy conversations about the
possibilities a new initiative presented. However, they rarely concluded these
discussions by executing them. In addition, board members did not have a clear
understanding of the company’s future, they were not aligned in the same direction, and
many were not engaged. The Board’s first task was to establish a clear direction for the
organization, develop a single-minded focus, and align on one initiative.
Initiative Agreement
The next step was to develop agreement between the Board and the CEO on one
specific initiative. Once this was in place, staff and management could be assessed on
their readiness to support the initiative. The assessment could serve as a virtual map of
the entire company as well as what was happening in each business unit, department
and team. The assessment simulates perceptions, threats, values, behaviors and the
corporate culture that works as well as the culture(s) that derail success in relation to the
chosen initiative. By fully engaging employees, it gives them an opportunity to contribute
their intellectual capital toward the initiative as well as focused insight into the unmet
needs of the marketplace.
With that intelligence, the Board and CEO learned that the majority of the employees
were fully aligned with the initiative. In fact, many staff already understood intrinsic
reasons for launching such an initiative. For other staff, their perceptions were counterintuitive.
For example, one of the most essential business units felt alienated and
refused collaboration with other departments. In other cases, employees who seemingly
had less to gain were the informal champions. What was most pervasive was the
unspoken policies. Although there were written and spoken policies in place, the
unspoken policies dictated behavior.
One of the unspoken policies was don’t tell don’t ask. When businesses are navigating
through change or new initiatives, clear, uncensored communication is essential.
However, in the case of the health care company, a sub-culture prohibited open
communication, so many issues went unaddressed. This unspoken policy resulted in lost
confidence, missed opportunities, redundancies and inefficient customer experiences.
Skills and Competencies
Other intelligence that was revealed was the gap in skills and competencies. For the
company to move to its next level, new skills and competencies would have to be
developed from the Board on down. Our assessment uncovered many of the skills and
competencies that would have to be developed by the Board and CEO. This sets up a
natural progression for delegation and continuous development of staff and
management. Staff wanted to take on more, however, they did not feel they had the
required skills or management’s confidence.
As the inherent strengths and weaknesses were uncovered through our team’s
assessment, management developed strategies to correct inefficiencies. The company
could map out a clear strategy for the future of the enterprise, how to get there, who will
support it and how to prepare people for successful execution. Additionally, by engaging
staff through the assessment, employees identified unmet needs of customers and
contributed (took ownership) to gain a competitive advantage in the marketplace.
With an organizational assessment, you can mine untapped intellectual capital, align the
entire organization on a single mission and make your employees your competitive
advantage. A competitive intelligence tool that assesses the readiness of an enterprise
is an effective process to incorporate into an organization’s structure. It’s a way to look at
the entire company as an individual with a multi-faceted personality. With insight into
what is and will happen, Board members and CEOs can be armed to implement their
greatest ideas and execute breakthrough initiatives.
References:
Pellettiere, V. (2006). “Organization self-assessment to determine the readiness and risk
for a planned change.” Organizational Development Journal, v24/4, p38-43
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