Monday, February 6, 2012

Will Your Culture Eat Your Strategy For Lunch?

If you follow these simple steps, embarking on a new strategy for your organization should be easy:

• Step #1. Market research (environmental market intelligence, customers, competitors)

• Step #2. Gap analysis (your mission, objectives, and service line capabilities)

• Step #3. Strategy (the big idea!)

• Step #4. Tactics, budgets, and plans

• Step #5. Implement (and succeed!)

Of course, I joke. Developing and implementing a new strategy is anything but easy. As many as 70% of strategic plans never get implemented (see Strategic Planning: A Structured Approach to Directing Resources to Achieve Your Organizational Objectives premium members and Does Your Strategic Plan Answer the Question: What Do We Do Now? all members).

But organizational culture as a major impediment to the success of a new strategy hadn't been top of mind for me until I read Shawn Parr's blog on fastcompany.com, Culture Eats Strategy For Lunch, which describes the dominance of culture in strategy success as; "It's one of the most important drivers that has to be set or adjusted to push long-term, sustainable success. It's not good enough just to have an amazing product and a healthy bank balance. Long-term success is dependent on a culture that is nurtured and alive."

In his model, there are four building blocks of a strategy-friendly culture – dynamic and engaged leadership, living values, responsibility and accountability, and celebration of success and failure. In health and human a services, I think most organizations hit three out of these four building blocks – all except the "responsibility and accountability" part. Many of the executives I talk to don’t have the organizational practices that measure performance and hold their team members individually accountable for specific contributions to that organizational performance. There are many factors contributing to this lack of metrics-based performance measurement. I used to think it was the cost of technology – but now technology is relatively inexpensive, so I am left with the conclusion that for many organizations, is a matter of organizational culture.

The need to create organizational practices (and change organizational culture) to embrace metrics-based management are many. Organizations that measure performance have been shown to have better clinical outcomes and financial performance (see Perspectives on American Health Care premium members). Secondly, we are focusing more on 'value’ of services. If you don’t measure your organization’s performance, someone else will do it for you – just a couple of days ago, the Measure Applications Partnership (MAP) of the National Quality Forum (NQF), released its first report on proposed performance measures (see Input on Measures Under Consideration by HHS for 2012 Rulemaking premium members).

So, before you launch into your next planning cycle, take the time to read the last strategic plan – and do a post mortem on your successes (and failures) in implementing your tactics. I would suggest measuring your success as a percentage of completed initiatives in your strategy implementation plan. If that percentage is low, you may want to give some thought to the causes of the poor execution. Was it culture that ate your strategy?

Sincerely,
Monica E. Oss
Chief Executive Officer, OPEN MINDS

P.S. For more on this topic check out these upcoming presentations; John F. Talbot's "Metrics-Based Management: How To Improve Your Bottom Line With Better Use Of Data" at the 2012 OPEN MINDS Best Management Practices Institute and "Implementing Your Strategic Vision: How To Move Your Organization From Plan To Action" at the 2012 OPEN MINDS Planning & Innovation Institute.

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For another free resource, see: The Real World Challenges of Performance Measurement all members 

This is free for the next sixty days to all registered OPEN MINDS Circle members.

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