Strategic & Operating Reviews Part 5: Waiting for Your Numbers
This post is the fifth in our series on Strategic & Operational Reviews (SOR).
Part 1 — Strategic & Operating Reviews: We Can’t Agree to Disagree — dealt with the issue that changes are coming to the Public Service, whether or not the leadership want it to happen. And, if these changes are going to be successful it will be predicated on creating alignment and embracing conflict management.
Part 2 — Strategic & Operating Reviews Part 2: Alignment and Failure — focuses the discussion on creating a greater understanding of the concept of alignment, why it matters, and where it is critical for success.
Part 3 — Strategic & Operating Reviews Part 3: Change and Failure — discusses the fundamental fact that SOR is about change. Managers must accept this fact and commit to the aspects of change management that will create the greatest likelihood of success.
Part 4 — Strategic & Operating Reviews Part 4: A Framework for Success — outlines the areas where managers need to maintain their focus as they work through these issues.
I had a conversation with an old client last week. You won’t be surprised that the topic quickly came around to the current climate of “doing more with less.”
And, I suspect that we covered the same ground that many, many managers in the Public Service are talking about right now:
- You know the budget cuts flowing out of the Strategic and Operating Reviews (SOR) are coming;
- You don’t know what you will need to contribute to the departmental Deficit Reduction Action Plan (DRAP), but you know it’s likely between 5% to 10%; so,
- What should you be doing right now?
As we talked, we uncovered four things that he could be addressing today that don’t require any specific knowledge of future budgets or staffing, but will prepare the organization to more effectively and rapidly implement the changes.
The 1st potential problem:
Things will fall apart when an organization's values, mission, vision, and customer/stakeholder value proposition haven't been properly defined. With an inappropriate definition, the risk of setting or continuing with misaligned implementation objectives is huge.
Get your team to re-examine your program values, mission, vision, and customer/stakeholder value proposition.
Give it a good scrub. In particular, understand where your strengths and weaknesses lie. Consider the Pareto Rule: where 20% of the output takes up 80% of the effort.
The 2nd potential problem:
Even if your team gets the strategy right, there is still a chance that the selected objectives won't get you where you need to go. The key is to identify the logic model(in the form of linked, strategic objectives) that will produce the desired outcome. It is critically important to get this as right as humanly possible.
The best way, in my experience, to do this is to ask—and answer—a series of questions that cascade from the mission, vision, and value proposition and are in alignment with the strategic direction and values.
In the private sector, these questions look something like this:
- To achieve the financial results we want, how must we appear / what must we deliver to our shareholders? (Brand promise to owners)
- To achieve the financial results we want, what must we do/deliver to our customers? (Brand promise to customers)
- To give our customers what they want and achieve our financial goals, what processes must we excel at? (Brand promise to employees)
- To execute our processes and achieve our other objectives, what organizational capabilities (people, culture, skills, tools, technologies, etc.) must we have/put in place? (Total brand alignment.)
By answering these questions in a focused way, organizations can develop a balanced set of strategic objectives that:
- result in the desired outcome,
- are well aligned,
- will be relevant to everyone in the organization, and
- will drive the organization to where it wants to go.
With appropriate contextual adaptations, these same questions can be applied to public sector organizations.
The 3rd potential problem:
If objectives are mostly financial, they often produce unbalanced outcomes.
If objectives are not aligned and achievable, the inconsistency will be apparent to both customers and employees.
And, if objectives are not actionable within the organization, you may well be out of business.
Make absolutely sure that revised operating budgets take into account the “creative thinking” that went into the SOR—do not disconnect them.
Revisit your Pareto list; make sure that you know where the 20% of your activities that achieve 80% of the results are to be found—and be certain that these are preserved! Your cuts should target those activities that generate no added value (NVA).
The 4th potential problem:
Ignoring your employees inevitably leads to alienation and decline in morale.
To make sure employees understand the big picture, carry out the review process with as much transparency and involvement as is possible—especially for those staff who will be affected by the changes. The following will dramatically mitigate the inevitable hit on employee morale:
- Make sure their input is factored into your decisions. If not, explain why not. Help them develop an understanding of the outcomes you’re projecting and create an early commitment to the plans that will follow.
- Present the total plan and work through it with the front-line teams early and often. Use effective communication to combat the “rumours”—which are typically worse than the reality.
- Build engagement with employees by giving them the full picture and show them how changes to the work processes—that THEY OWN—will be critical to the success of the project.
If you take these actions steps seriously, you will have more than enough to keep you busy until your budget numbers arrive. For now, keep your focus on strategy, alignment, and engagement—that is what will put you ahead of the game when it’s time to implement.
Download our new eBook: