Strategic Management: Moving away from planning and into hands-on bridge building
How agile working methods and the challenges of an ever faster moving business environment (VUCA) is forcing management to rethink its classic role as a chief strategist and decision maker.
To read the German version of this article, please click here.
Agility is often viewed by top management as a silver bullet that allows a firm to be “faster-higher-further”. Agility seemingly allows individuals to finish projects in a smaller time frame and to achieve the goals that were set at the strategic level. This is exactly what renowned consulting firms have sold to c-level management across numerous industries in the past years. Unfortunately, this is often done without any real alignment between the ambitious strategic goals and the operational level. However, even with agility it seems – unsurprisingly – that “faster-higher-further” is not always reached in the long term. Many mistakes will be made and will continue to be made. In practice, “old” as well as new problems will emerge. Even this silver bullet that started off so well and full of promises, is missing something. But what is missing?
An example: The introduction of SCRUM is working perfectly in a (project) team. Everyone is equally excited about the achieved success – this includes the team as well as top management. Then the new approach seems to be reaching its limitation, one that is unable to be overcome, namely, the classic management structure. Suddenly, the teams and the middle management are standing alone in front of this limitation. In front of the problem that is theirs alone – one that is not shared with top management. In addition: there is no door, no way out, just one big sign with the words “The corporate goals set last year from the “ivory tower” have to be achieved at all costs”. The cost is big and operational implementers and middle management are making no progress with their new endeavor. The solution is to fall back on the classic top down management approach. The “old world” in which “top beats bottom” is fashionable again. Why does this happen? A bridge is missing.
The people that work every day on building a bridge and breaking down existing borders are missing. Through them, the one-way street called “top down business strategy” becomes a bridge between the strategic level and daily operations, where information can travel in both directions. It is crucial that these individuals work on such a bridge every day – regardless if they use Kanban, OKRs, LeSS…or any other such tool. The tools and methods available for use are plentiful and need to be chosen specifically for the context and the company.
It is mandatory to decide WHO is responsible for this bridge building and it is indeed c-level management that must do so.
Top management needs to set an example by living and breathing these new values. It needs to show that it does not dictate a one-way ivory tower strategy anymore, but rather, an agile business strategy that is so urgently needed in this VUCA world. The strategy must be able to “breathe” and be based on the latest findings of the operational level, allowing and encouraging traffic to travel across the borders. The current (COVID-19) crisis has shown us, without a doubt, how crucial the connection beyond corporate silos is and how essential the bridge between the managerial-strategic level and daily operations is, in order to be able to react to changes quickly and identify new opportunities.
This does not mean that management must do everything by itself, but it is responsible for the statics and the framework of the bridge. Above all, management is responsible for its existence. Further, it is accountable for building and maintaining the bridge so that information can flow in both directions. Top management needs to see its core mission not in creating and maintaining a rigid strategy, but in successively creating the necessary framework for the entire company that encourages this exchange. Most importantly, it needs to demonstrate this behavior.
Such an approach comes with new challenges for management and requires rethinking in many areas and on levels within the organization:
1. Servant Leadership
To begin with, management needs to change the way in which it perceives itself. Managers are a function of support to their employees. They are enablers who, as described above, create the framework that empowers their employees to do their work the best way they can. They must allow as well as encourage the flow of information in both directions. A clear break with the usual hierarchical approach of management, as described by Robert Greenleaf. This is an approach through which success depends on different human as well technological factors, the key words being: digital leadership.
2. Open Communication
The concept of servant leadership goes hand in hand with the choice of communication that is essential to establish openness. If the goal is that competent employees should give honest and relevant input for the company and the strategy, then managers must listen actively and enable open communication on a level playing field. Otherwise, motivation and valuable learnings from the daily operations are blighted.
3. Willingness to change – or: “Leading by Example”
An honest willingness to change is key to achieve the required change – combined with the will to experiment, allowing for mistakes to happen, as well as learning from those mistakes. When a situation such as the one described above occurs, and problems or mistakes arise that are part of the process/daily business/etc., old mechanism are put into place (“top beats bottom”), willingness to change is halted and a strategic one-way street results.
4. Always look at the big picture!
In most cases top management does not only need to build bridges but a whole network of bridges. This includes bridges between departments and silos, between top and bottom and between working methods and tasks. The network of bridges must go beyond existing borders within the company and above ditches and barriers. It must allow a steady flow and exchange of information. The network of bridges should move away from a “them” mentality to an “us” mentality.
In order to perform better in a VUCA world, strategy needs to become more up to date and lively. It needs to become a network of bridges through which relevant knowledge and ideas can flow, be exchanged, and be made available at all levels of the organization.
This means that top management needs to rethink their role within the organization. It must move away from being the strategist in the ivory tower to the strategic enabler, who works closely with the daily operations, who collects, puts together and redistributes information from all levels – and who above all builds bridges for everyone.
Source: “Doing Agile Right: Transformation Without Chaos” (Darrell Rigby, Sarah Elk, Steve Berez 2020).
About the Author
Mr. Rufus Henneken has a diverse multinational background as a strategy and change management specialist with a focus on digitalization. He has over 10 years of experience in a wide range of industries, including insurance, engineering, logistics, financial services, and public sector. He has served in many different roles, including sales, corporate development, project management, and management consulting for companies all over the world.
One of the most well-known companies Mr. Henneken has worked for includes PricewaterhouseCoopers, where he served in an audit and advisory role. Mr. Henneken holds a Masters Degree in Strategy & International Business from Aston University (UK).