A friend contacted me regarding my article titled “EXECUTION SUPERCEDES PLANNING” and asked a very interesting question namely “if execution is the silver bullet, how do we fire it?”. I paused for a moment then clarified that there is no silver bullet an institution can fire and have its strategy fully implemented. Implementation could instead be likened to a loaded gun from which an institution fires bullets regularly coupled with an autocannon from which larger caliber explosives are occasionally released.
This conversation took me back FOUR years ago when we met a board of directors who were unsure about why they were making little progress in their strategic plan implementation. Upon evaluation, we noticed that the strategic plan was well developed and had very clear strategic pillars as well as Key Performance Indicators. However, further discussions revealed that a large number of activities undertaken by staff and board members had little or no bearing to the key performance indicators. Consequently, human and other resources were being directed towards non-strategic issues.
Evaluation of the board work plan revealed a number of initiatives that were not linked to the strategy. For example, the board was undertaking benchmarking visits but had not linked the same to either branding or process improvement, two KPIs that had been spelt out in the strategic plan. On the other hand, staff performance scorecards, from which staff activities were derived from consisted of issues that were not measurable by such as teamwork, professionalism and fitness to culture amongst others. Others such as number of marketing drives – defined as a KPI – though important, were leading to appreciation and reward towards of efforts at the expense of results.
We embarked on a journey to realign staff and board activities with the strategic key performance indicators (KPIs). We had to evaluate initiatives, activities and programs and link them to the KPIs. Approximately 55% of the activities could either not be linked to any KPI, were poorly defined as KPIs instead of activities and vice versa or were ineffective measures of the KPIs they were linked to. For example, the management was religiously monitoring staff reporting and departure time – to them, a measure of professionalism – in a bid to influence commitment without necessarily having a way to assess if staff were productive during those hours. In addition, they were reporting daily volume of transactions per business unit without evaluating adherence to service turnaround time. Customer complaints had also been omitted from all scorecards yet the company was aspiring to improve service quality.
Strategy implementation issues were resolved once the misalignment between KPIs on one hand and activities and programs on the other was corrected through revision of the staff performance scorecards and board work plan. Both had to capture all strategic pillars and have measurable KPIs. However, staff KPIs and the weight of each strategic pillar for each staff differed based on staff roles. On the same breath, all projects and activities were aligned with relevant KPIs. During the exercise, some of the elements classified as KPIs in the previous performance scorecards were re-classified as activities in the new scorecards.
The exercise did not resolve all issues but was a major step at the beginning of a long journey. It still required a bit of automation and cultural realignment. It however has enabled the company to fire effective bullets (low risk experiments and initiatives) such as reorganization of their sales team and review of some policies and procedures in the short-term as well as larger caliber explosives (large scale medium and high risk experiments) in the medium and long-term such as establishment of a subsidiary both with improved results. The company’s profitability as well as growth in clientele base has more than doubled during this period and I believe the best is yet to come.
Dr. Weru Mwangi is the CEO & Lead Consultant at Ultimate Management Solutions, a firm specializing in training & consultancy in Finance, Governance, Strategy, Risk Management and Leadership Development. He can be contacted on weru@umslgroup.com
