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Too Much Strategic Planning

February 7, 2011 in Leadership, Managing, Strategy with 2 Comments

As I meet and talk with executives and business owners, I discovered there are three types of leaders when it comes to corporate strategy: Those who do strategic planning, Those that don’t bother with a strategic plan, and Those who actually implement their strategic plans. Unfortunately, the percentage of organizations that actually implement their strategic plans – and as a result, achieve their annual goals – is quite small.

“Most of the time, strategists should not be formulating strategy at all: they should be getting on with implementing strategies they already have.” – Henry Mintzberg

According to a recent survey by McKinsey & Co., of the respondents that actually do strategic planning, 69 percent reported that there was a breakdown in the alignment of the company with the strategic plan and poor execution of the plan.

So what can you do to make sure your business is in a better position at the end of the year versus where you are today?

1. Make sure you actually have a strategic plan. If you don’t have a strategic plan, develop one – it’s not too late. Define your business mission. Assess the external forces that affect your business (economic, environmental, political, legal, competitive,  etc.). Conduct an Internal Audit of you business including your culture, management, marketing, financial/accounting, operations, HR, R&D, and IT. Define your strategic objectives and strategies to achieve those objectives.

2. Communicate your strategic plan. You should be able to distill your strategic plan down into a single page. If you cannot communicate your strategic plan on a single sheet of paper, it’s too complex. Not only that, but your team members will struggle to understand how what they do relates to or impacts the business’ strategic plan. Everyone from the executive offices to the shop floor should understand where your company is going and how they contribute to getting there.

3. Translate your strategic plan to measurable goals. Based on your strategic plan, where should each department and person be at the end of each quarter, each month? These measurable goals should now be driving weekly and daily activities for each function and team member.

While this is a very high level approach, following these three steps will help ensure your company’s daily activities are aligned with the business’ strategic plan.

If you have other approaches that have worked in your company, please share them in the comments section, I would love to hear what you’re doing.

5 Habits To Get Yourself Unstuck

December 13, 2010 in Leadership, Managing, World-class with 7 Comments

As we are pursuing our goals, there are times when we get stuck. We start going in circles instead of towards our destination. I ran into this problem earlier this year in my business and spent too much time going in circles instead of breaking out and getting back on track to my destination. As I went through that process, I focused on building five habits back into my life. I can’t take credit for developing these habits, I picked them up from the book of Proverbs. (If you read that book 12 to 15 times, you’ll practically get an MBA, it’s in there.)

The preface to all of this is you have to seek to get unstuck. Which means there must be an energy, a passion in your efforts and activity.

1. Don’t Be A Loner. If you want to get unstuck or grow in a certain area, you need fresh information coming in to you. Go get counsel from someone who is where you want to be or can give you an objective assessment. Get advice from others who truly care about your success and don’t have their own agenda.

2. Don’t Make Excuses. This usually sounds like, “this isn’t going to work, so I’m not even going to try.” Listen, when you make excuses it changes your focus away from the real issue. Not only that, but it paralyzes you. You become very good at finding ways to shoot down every potential solution you come up with. Learn to change “I can’t … ” to “I can….”

3. Don’t Love Comfort and Ease. Don’t be a comfort addict. Life is not supposed to be comfortable. If you’re comfortable you’re not growing. At the end of the day, it’s not about how you feel, it’s your destiny that matters. You were put on the earth to accomplish something. Change isn’t comfortable, get over it, it will help you grow up and mature.

4. Don’t Get Preoccupied. When we’re stuck and going in circles, we are often just focused on what we are doing. Instead, focus on why you are doing it. If you’re a plant manager, you’re not just running a plant and shipping products; you’re providing people with good jobs, serving your customers with a product or service they need, and making your community a better place to live.

5. Don’t Be Hard-Headed. Be teachable. Just because you thought it, doesn’t make it right. Always be looking, gleaning, growing, seeking. Ask questions. Let others talk more, not you talking about yourself. Read. Five years from now, you will be in the same place except for the conversations you have and the books you read. Be teachable.

By incorporating these habits back into my life, I got myself and my business back on track. I would love to hear what you have done  or your thoughts on how to get unstuck.

Get Bigger or Better?

October 23, 2010 in Leadership, Managing with 5 Comments

There is a great story about Chick-fil-A founder Truett Cathy. When the company faced it’s first real competition from, now, Boston Market, the young executives started furiously working on how to grow Chick-fil-A bigger. They wanted to open more stores to compete with Boston Market. After working for about a year or so on how to make the company bigger, the staff was in a meeting discussing the subject. Truett Cathy, who was then in his 80′s, began pounding on the table. Everyone else quieted down and looked at the founder who said “I’m tired of hearing all this talk about how to make the company bigger. Focus on making ourselves better and our customers will demand that we get bigger.”

There are a couple things about this story that I love and think are quite applicable to all organizations.

1. Don’t Let Others Drive Your Strategy. In the Chick-fil-A story, the young executives allow Boston Market’s strategy of opening lots of stores to shift their focus away from their strategy. As a result, they become fixated on trying to open more stores than their competition.

When you look at your own business, understand what your goals are and stick to the best strategy that will get you there. Don’t ignore your competition; you should monitor what they are doing. However, you should not mimic what they are doing in an effort to gain more market share.

2. Don’t Lose Sight Of Your Corporate Values. Part of this story involves the Chick-fil-A executives seeking out investors and looking at lines of credit to expand quickly and open new stores. This strategy was completely contrary to the company’s values up to that point. The company had very little debt, if any, and was owned by the Cathy’s.

As you evaluate different marketing and business strategies, make sure you consider how they align with your corporate values. Don’t get caught-up in the urgency of the short-term, instead consider the long-term implications.

3. Bigger Isn’t Always Better. Truett Cathy recognized that if the company focused just on getting bigger, they may lose ground in their quality, hospitality, customer loyalty. Instead, they needed to maintain their focus on becoming better, and as a result, their customers would demand they get bigger.

We’ve seem plenty of examples of companies that expanded too much too fast and then had to shutdown operations or even ended up going out of business. Really evaluate if bigger is better. For some companies staying smaller is better, look at 37 Signals for example. They are a phenomenal company that is focused on not getting bigger for bigger sake. Instead, focus on how you can make yourself better in all aspects of your organization. Then you can let the market demand you get bigger. Isn’t that what we  want?

EntreLeadership Announcement

August 20, 2010 in Leadership, Managing with 0 Comments

We are pleased to announce that Operations Strategy Consulting is hosting Dave Ramsey’s EntreLeadership simulcast on November 5!

The event will be held at Living Hope Church in Whitney, PA (near the Arnold Palmer Airport in Latrobe, PA).

The Simulcast will begin at 9 a.m. (doors will open at 8:30 a.m.) and wrap up at 3:30 p.m.

Tickets for this event are $39 and may be purchased through Operations Strategy or online. Tickets will be available until October 22 or they are sold out.

Learn more about this event including lesson overviews.

What’s Your Why?

August 10, 2010 in Leadership, Managing with 0 Comments

This blog entry is focused mainly on business owners or companies that are still privately held. However, if you’re in a publicly traded company, the concepts will apply to your department or function just as easily.

This week, I just have a challenge for you. As you go through the week, pause before each activity you must do or meeting you attend and ask why are we doing this, or why is this important. You and your team need to know and understand the why behind what you’re doing. Why? Because human beings innately need to believe that what they are doing has meaning, otherwise, they will give up on the activity.

If you are the business owner or founder, why did you start your business? It’s not just to make money. Starting a business is really hard work and there are easier ways to make money. So what was your why?

Now, do the other people in your company know, understand, and believe in your why as much as you? If they do, great! You’re in a very elite group. If not, you need to make a commitment to change that.

Ask your self, how much time do you spend talking with your team about your company or department’s vision, where you are going, and why.

When taking on a new initiative, do you share the reasoning behind it or simply declare the new direction?

Do your actions reflect what you say is important or do they send a different message. For example, we care about quality, but the product better ship by the end of the day or there will be some explaining to do.

Your “Why” for being in business needs to be personal and compelling for everyone on your team and in your company, otherwise, it’s just another job to earn a paycheck. And as a business owner, do you want people working for you that are just looking to earn a paycheck?

The Number One Productivity Killer

July 26, 2010 in Employees, Managing, Operations with 1 Comment

I’ve been reading Rework by 37signals founders Jason Fried (@jasonfried) and David Heinemeier Hansson (@dhh) this month and they have a short section titled “Interruption is the enemy of productivity.” The entire premise of the section is the reason you don’t get enough done at work is because of interruptions, which is why we can accomplish so much at night, early in the morning, or on a plane. These interruptions break up the work day into work moments. Thirty minutes and then you have morning break. Fifteen minutes and then you have lunch. An hour later, you have an afternoon meeting. The next thing you know the day is over and you haven’t gotten much accomplished. It’s difficult to get key tasks done when you’re constantly starting and stopping.

In an office, these interruptions are easy to pick out. All those little impromptu get-togethers, chatting with colleagues, and phone calls break the flow of people’s work. But those are not the only interruptions: email, meetings, and instant messages distract people from their task at hand and cause them to shift focus to something else, then mind-shift back to their work. To increase productivity, we need to find a way to eliminate or minimize these interruptions.

In case you think this is just an office problem, it’s not. This is just as applicable to your team members who work on the shop floor as those who work in an office. When you have an assembler or machinist that has to stop working to go find the right material, get the correct tool, or replace a cutter or drill, they have to mind-shift between these tasks and you lose productivity. Not only does this slow them down, but then they often have to recheck or inspect the parts produced once they begin working again to ensure they are in tolerance.

To get the most accomplished, we need to find ways to eliminate all these interruptions. For those in the office, the guys at 37signals suggest instituting no-talk Thursdays instead of casual Fridays. Or set work rules that from 10 a.m. to 2 p.m., people can’t talk to each other (except during lunch). Or make the first or last half of the day your alone-time period. Michael Hyatt, CEO of Thomas Nelson Publishing (@MichaelHyatt), tweeted that they have “No Meeting Fridays.” One of the changes I made at the beginning of the year was to only check email twice a day at noon and 4 p.m. Most of my clients and colleagues know that if something is urgent and cannot wait until those times, they should call me. This helps me to not live in my inbox and stay focused on the project at hand.

What about the shop? What can you do to help your production team get more done in the day? Keep production meetings to the start or end of each shift. Talk with your team. Watch and understand the process. Do they have all the materials, tools, fixtures, gauges, and prints they need to finish the job at their work station? I once had a client that discovered out of the 7 hours and 15 minutes it took to change over one of his presses, 2 hours and 21 minutes were spent just going to find things and dealing with interruptions! Do you know what interruptions are costing your company?

Start eliminating interruptions today and see your productivity increase.

Have a great idea or are doing something to eliminate interruptions in your business, share it with us in the comments.

8 Reasons Continuous Improvement Programs Fail

July 15, 2010 in Lean, Managing, Quality, Six Sigma with 0 Comments

Lean, Six Sigma, TQM, TPS, Agile and ISO are just a few of the initiatives companies embark upon to improve their performance and reduce costs. Unfortunately, many of these companies fail to achieve all the benefits from their efforts.

The reason most improvement efforts fail is not because the company chose the wrong program or initiative, they just got tripped up in the execution. Here are the eight most common mistakes I have seen companies make with their improvement programs and how to avoid them.

1. Flavor of the Month: In an effort to be on top of the latest and greatest, you launch three different continuous improvement programs in eight years. Employees fail to take the newest initiative seriously, because they know it will change in a couple years. The best way to avoid this mistake is to pick a program and stick with it – don’t chase the trends. Consistency is key with change programs.

2. Focus on Everything: Once you have a continuous program in place, it’s important to link those efforts to the business’ strategy. Prioritize those efforts, you can’t have 78 key strategic initiatives. Your continuous improvement efforts will be much more successful if the company prioritizes its initiatives and goals and you focus on just the top two or three.

3. Project Cure Cancer:A common mistake I see is defining the initial project scope too broadly. The project owner and team quickly become mired in all the processes and data and are overwhelmed. As a result, the project either stalls or dies and the underlying problems are never resolved. When scoping a project, focus on narrowing down the project scope to something that can be completed in four months.

4. Project Scope Creep: Closely related to poor project scope is project scope creep. What may begin as an innocent-sounding request to modify a project can spell doom to your company’s improvement initiative. By expanding the project’s scope, you add time and rework to the project, eventually, the project may never be finished – frustrating all involved. To avoid this, establish a formal sign-off of the project scope by the project owner and the champion.

5. “The Problem is We Don’t Have A Database.”: Frequently when a manager or executive wants to fix a problem, they define the problem by what they perceive the solution to be. This is natural to them, because they are paid to solve problems. The mistake is the project then addressed just the symptoms and not the root cause of the problem. You need to define the problem based on how it is manifesting itself, not the perceived cause or solution.

6. Not Committing Resources:All too often, I’ve seen managers assign people to projects aimed at solving major problems, then pull those people off the project to do firefighting! Just commit the resources to the improvement efforts and don’t give in ot the temptation to pull them back off the project to to the urgent.

7. Committing Poor Performers: The corollary to not committing resources is committing the wrong resources. If you can assign those who can be spared, are you really assigning the people who can make a difference? By assigning your high performers and those with authority or influence, your improvement efforts will have a greater effect than just committing resources that can be spared.

8. Lack of CEO and Leadership Commitment:This is the number one reason why continuous improvement efforts fail. If your company’s CEO and executive leadership are not committed to your improvement program, it will never succeed. Support is notsufficient – support is often just lip-service. The CEO needs to hold the executive team accountable for improvement efforts and results, be involved in project reviews and progress, and be trained himself. Similarly, the executive team must hold their own staffs accountable for the improvement efforts and results.

By avoiding these pitfalls, your company will see greater results quicker than your competition who fall into these traps.

Efficient or Effective?

July 8, 2010 in Lean, Managing, Operations, Quality with 0 Comments

I’m starting to get tired of listening to people talk about efficiency. That may sound strange for someone in my position, but hear me out on this. We read things all the time about how to be more efficient. People talk about being more cost-efficient, more efficient with their time, and tracking employee efficiency. Merriam-Webster defines efficient as productive without waste. In other words: doing things the right way.

But, I think we’re missing the other half of the equation. I can be very efficient at, say, photocopying documents and filing them in filing cabinets. But that is not the best way to make the information on those documents more organized and accessible. In addition to being efficient, we also need to be looking at effectiveness. Merriam-Webster defines effective as producing a decided, decisive, or desired effect. In other words: doing the right things. Back to my earlier example, if I want to make the information more organized and accessible, a more effective approach may be to scan the documents into a searchable database. Another option is to change the process so the information is entered electronically the first time instead of generating paper documents.

Too often, businesses are looking at “how do I take waste out of the process” and forget to ask “Is this the best process to achieve the desired output.” When you consider that everything we do is a process, from brushing your teeth, to writing a blog, to manufacturing a locomotive, the question becomes what is the desired output of that process. Why are we performing this process? What do we hope to accomplish by following this process? By doing this, you may discover that some processes can or should be eliminated.

After you’ve identified what the desired output is, then you need to decide: what is the best way to achieve that output? Guess what? It may not be the way you’ve been doing it. Sometimes, we can just optimize the existing process, but don’t be surprised if you need to create an entirely new process. Look at others within your industry and see how they are doing things. Then look at other industries that excel at that particular area. Whatever you learn from others, remember you cannot just copy the process. Each company has its own culture and a process that works in one will not produce the exact same results in another company. So learn from others, but be able to adapt.

Once you’ve identified the most effective process, make sure it is as efficient as possible. Look for any rework, complexity, or repetition and eliminate and simplify the process.

Now, test out your process. Did it work as you had planned or envisioned? Do you need to make any tweaks or adjustments? Once you have an efficient and effective process, you can implement it.

With that success under your belt, go out and tackle another part of your business so you can be just as effective as your new process!

Are You Innovative?

June 30, 2010 in Leadership, Managing, Operations with 0 Comments

In my last post, I talked about the importance of people within your organization and freeing them up so they can become more innovative. While I got a lot of great feedback from many of you, some disagreed. The thought being: “I don’t want people changing the process or experimenting on the job. I just want them to come in, follow the process, do their job, and go home.” Now, I have to admit, that there was a time when I agreed with that sentiment – especially since I spent so many years in manufacturing and operations. However, I’ve learned a thing or two in my career that has changed my view on that.

Traditionally, if you ran a manufacturing plant, hospital, or accounting firm, you wanted people to come to work on time, follow the rules and the established processes, and leave at the end of the day. The thought being, if someone left or had to be let go, they were relatively easily replaced. And, if someone is easily replaceable like that, you can pay them as little as possible to keep your costs down and compete for business.

The problem with that mindset is it’s not working anymore. Companies cannot continue to compete on price, instead we must focus on how to add value to the customer, to differentiate yourself from your competitors. Seth Godin goes into detail in his book Linchpin about how to become a linchpin and why they are good for companies. Think about the maintenance person in your company who knows how to fix anything or troubleshoot any problem – that person is indispensible. Now imagine if all your employees were like that – what would it mean to your competitiveness?

Do we need to have processes and procedures – yes, because customers want reliability and consistency. However, there needs to be room for your people to innovate and develop new ways to wow your customers and bring more value to them. Look at the auto industry. Most of the companies are competing on price and with few exceptions cars are not very different. But what about Rolls Royce? This is a company built on craftsmanship – each car is handmade. The machinists and fabricators there are not easily replaced, they are practically artists. Do they have procedures to follow? Sure. But do they have the freedom to innovate, to really wow the customer? Absolutely; which is why they are able to command the prices they do. They are not competing on price because of all the perceived value they offer.

How can you change your company or department to become more innovative?

1. Eliminate the wasteful, redundant rework people have to do. Streamline the process to give them more free time.

2. Ask yourself if the culture fosters innovation. Are new ideas shot down because “that will never work,” or “we tried that before and it failed,” or “you haven’t been here long enough to really understand how things work.” Change your actions to begin changing the culture – even if it’s just within your own team.

3. Invite and challenge people to come up with new ideas, methods, or products.  Remember failure is a great teacher.

With the current rate of change, if you are not moving forward and innovating, you are moving backwards.