Execution vs Operationalisation
Businesses in many industries are talking about the need to transform the way they engage with their customers and fulfil their products and services often in the context of “digital transformation.” Programme and project managers will be at the forefront of delivering these changes but are the leaders of these businesses setting-up their programme and project managers up for success?
In my discussions with main board directors of national and international businesses, I hear their desire to deliver the benefits of their strategic transformation programmes. Often their personal reputations are on the line; however the demand to move to action (execution) too early almost always compromises the outcome at the outset.
There have been a lot of wise words written over the past years about turning strategy to execution. The role of formal programme and project management has an undoubted part to play in this and the recognition and development of this critical profession is fundamental to the delivery of the outcomes that will ultimately embed the strategy into the organisation. An often accepted model for turning strategy to execution is represented below. This supports the execution approach which promotes the clear link between the strategic objectives and the portfolio and programme - the key delivery component.
However, I would suggest that this model can be seen as bottom up. It is a bit like shaping the jigsaw pieces without having a good understanding of the picture on the lid of the box. The strategic objectives do not and should not describe in detail the capabilities required to support those objectives. It is the strategic portfolio and programme that will deliver the capabilities that will then produce the outcomes. So what is missing?
To truly “operationalise” the strategy we will first need to design the future state that will realise the strategic objectives. This design is embodied in the target operating model. This model is not just a high level description of an organisation structure and high level processes. The target operating model is a representation of how the organisation’s components are configured and function together to execute the strategy. Communication to all stakeholders of how the organisation currently works and how it will change to support the strategy is its primary purpose. Furthermore, it provides and end-to-end view across the value chain of every significant element of business activity. Through descriptions of the required capabilities and their maturities, and a transition road map, the target operating model will provide the steps to get to the destination. The execution model therefore should include the additional step of design.
This however is only part of the way to truly “operationalise” the strategy. Once the execution has commenced and programmes and projects have been mobilised, the real world has a nasty habit of intervening. The transformation roadmap and plan was absolutely the right plan, built on very robust assumptions and tested thoroughly before we mobilised.
However, competitors and the wider market will not stand still while the business is executing its transformation plan, developing capabilities and delivering the strategy. The business therefore, needs a mechanism for in-flight course changing, where necessary, to react to external trends and influences. The ability to see trends, recognise impacts and then analyse them and prioritise responses is the first component. Executing the transformation (and running the business), then modifying the target operating model design and any impacted programmes, is the second critical component required to “operationalise” the strategy. The figure below identifies the final component needed to truly “operationalise” the delivery of the strategy.
Far too many times, programme and project managers have been criticised for not delivering or executing the strategy. In most cases it is not a lack of capability on their part, more of a lack understanding from the business leaders of what is required to set up the environment and structure to enable the right portfolio of programmes and projects to be shaped and mobilised and then executed. Execution is very important, but let’s make sure we are executing the right things first.
Chris Bevan is a Co-founder and Managing Director at Outvie and an expert in leading large scale business transformation.