Strategy : Where Do You Go From Here?
Karen Hosey is President and CEO of Z.O.E. Consulting, LLC, with over 24 years experience in strategic planning, sales and leadership development. She currently assists businesses and ministries in achieving their vision through customized processes in strategic planning, marketing and leadership development.
Many businesses and organizations take a reflective look back each quarter to ensure they are on track. This “quarterly review” usually focuses on numbers; “Did we hit our sales target?” “Did we hit our new client goal?” “How many new customers did we serve?” “Did we hit our profit margin?” While this financial review is absolutely critical, it should not be the only aspect of our businesses that we evaluate and assess. Numbers tell only a part of the story—and unfortunately, in many companies, they can tell whatever story the boss wants told irrespective of reality.
I’m reminded of when I served as the VP of Sales for a division of our company. The sales force had just come off a record year hitting a 24% profit margin (industry average was 18%) while boosting sales to $129 million. After submitting the sales plan for the next year and having it come back on two occasions with the comment “these numbers aren’t right” I finally realized that my boss wasn’t looking for actual numbers based on the market; he wanted something that justified numbers he had submitted. Did it matter that his number reflected a 30% market share capture for a new product launched into a new market against two dominant competitors? No, the number was neither attainable nor realistic but it was the number.
Financials are actually a reflection of investments in people and processes. If wise investments are made in those two areas, the numbers will speak for themselves. Yet, development, training and process improvement are usually afterthoughts during the planning process. As you begin your review and finalize plans for your future, here are a few items to consider:
What percentage of your review and your future plans are actually directly related to your vision? If your vision is to be the leading provider of customer relationships does your financial statement reflect that? Looking back at last year—did your communications with your staff address how close you were to your vision or to a financial target? How many of your employees can even articulate the vision?
What percentage of your review and future plans reflect your values? If investing in and valuing your people is a core value, does the money trail actually reflect that? How much has been spent on staff development? How much was spent on skill training? How much have you budgeted in those areas for the next year?
How much time (and money) has been invested in improving employee morale (which translates to loyalty and job performance)? Do you have a rewards program? Do you recognize outstanding performance in areas other than numbers? In what type of physical environment do your employees spend their day?
How much input do your employees have in the direction of the company? Are their ideas valued or tolerated? Are they included in the decision making and planning process or are they simply expected to “make it happen?”
Do your plans reflect a long-term mentality or “grab it and run?” Is every plan and every metric centered on the short term (18 months or less) or do they recognize short-term sacrifices for long term gain? When employees see only short-term solutions they become insecure about the future and that is not a breeding ground for excellence.
In recent years, many businesses have taken a short-term approach: as the life expectancy of a CEO has been shortened so has their willingness to invest in the future. They don’t have a need for a long term solution; they want their tenure to be successful so everything is based on the here and now. Employees have come to recognize that “the guy at the top won’t be here long” so they either try to “ride the storm” or “get what I can while I can” with no regard for the long term viability of the company. Because employees take the “path of least resistance” approach, performance and thus results suffer, the company does not do as well as expected so the CEO is indeed replaced and the self-fulfilling prophecy continues.
How can you break that cycle? Value the past, take care of the present but prepare for the future. Invest in people. Invest in processes that make people more proficient and efficient. A satisfied, well developed and valued workforce will produce results that can only be imagined in a short-term culture. Peter Drucker has said, “Management is doing things right, leadership is doing the right things.” As you evaluate past performance and prepare for the future, ask yourself, “Am I more focused on doing things right or doing the right things?” Those are not mutually exclusive. If the leadership takes the approach that “we will do what’s right, because it’s right then we’ll do it right” there is no way the organization can fail. And best of all, your staff will walk right beside you all the way!
© copyright Karen Hosey 2007