Organizations that focus on the right barriers to strategy execution improve sales growth and customer retention.
By JOE PETRONE
In a May 2010 article in the Harvard Business Review, Jocelyn Davis and Tom Atkinson refer to a study they conducted with the Economist Intelligence Unit of 343 businesses, which found that “companies that embraced initiatives and chose to go, go, go… ended up with lower sales and operating profits than those that paused at key moments to make sure they were on the right track”’
How can you not only make sure you are on the right track, but also stay on the tracks? One approach is to use a systematic strategy execution model. Results show that within one to six months, most sales and service organizations achieve a significant improvement in sales growth and customer retention through effective execution. What does effective execution mean? Simply, prioritizing action plans to overcome the most common barriers to strategy execution.
The three stages for strategy execution are Architect, Navigate and Farm. The Architect stage includes your leadership system such as the vision, strategies and core values. Most organizations use an outside-in approach in developing their leadership system by scanning their environment so that the strategies provide the direction, capitalize on opportunities and inspire sales teams.
The Navigate stage translates the leadership system into action by sales management’s sensitivity to various team member attitudes and skills. How sales management translates the leadership system and direction into a diverse team environment is not an easy task. Communicate one message to eight direct reports and it is not uncommon for sales representatives to use selective filtering on what they want to hear. Messaging on all matters (e.g. promotions, recognition, feedback) must be aligned with the strategies and core values.
Finally, the Farm stage develops and reinforces the desired sales representative behaviors that will move the organization to its vision. Normally we spend time on training and compensation to get orders. However, the engine of the farm stage is moving performance management from an annual to a periodic review of how gaps – behavioral and performance – are being closed. Here is a challenge for you. Take your performance management system and list all the factors that are measurable. Do the same in your compensation plan. Unless most of the measurements in both of these systems align with your leadership system, you are falling into the trap of measuring and rewarding A while hoping for B.
Staying aligned and on the tracks means making the most important choices and actions everyday. So you can prioritize action plans, seven principles in total will guide you through each of the three stages. The Architect Stage has three principles that tie to accountability – one of the most important key success factors. The Navigate Stage’s two principles will tenderize your messaging and feedback, so that your team can chew on and digest your strategic direction. Finally, the Farm Stage’s two principles will enable you to overcome the most common obstacles to flawless execution-measuring what matters.
Systematic strategy execution model and principles
Architect Stage
- Build alliances immediately with all direct reports and the 5 key players most important to your and your team’s success
- Instill accountability by your actions.
- Share success stories that are directly linked to your leadership system
Navigate
- Assess your team’s abilities and attitude
- Adapt your leadership style to each member of your team with laser-focused feedback.
Farm
- Progressively improve performance thru just-in-time performance management and training.
- Reinforce desired behaviors thru informal rewards
Whether you are a field sales manager or the vice president of sales, the above seven principles apply. Keep in mind that the most important principles are in the Architect and Navigate stages.
Laying the blueprint in the Architect Stage
Build alliances immediately with all direct reports and the five key players most important to your and your team’s success
Start by doing an alliance-building interview with your direct reports. The purpose of an alliance is to create a balance of power between you and your reps in achievement of a goal. What this means is that you will come alongside your reps in supporting their attainment of territory plans and goals. Below is an example set of questions to ask in your first alliance interview.
How do you define success?
What are your strengths? Obstacles? Challenges?
What is demotivating?
How do you like to communicate?
How will I know when you are stuck?
What would you like to learn but have not had the support or the time?
Once you have completed interviews with direct reports, start interviewing the five key players most important to your success. This could be your boss, your boss’s boss, vice presidents in product management, operations, finance and human resources. Adapt the above questions toward more of an understanding of their goals for their function. Ask what expectations they have of you and your team. If you find yourself avoiding key management personnel in other functions while in the home office, this is the best time to start arranging an alliance-building interview with them.
Experience proves that these interviews can condense six months of communication into a one to two hour exchange that naturally leads to greater accountability. After doing research with the APQC in Houston, it became clear that accountability to your leadership system is the single most important thing you can do in your role. Do what you say you are going to do consistent with core values, strategies and the mission!
Instill accountability by your actions.
You’ll always have executives from other functions blame you. Avoid falling into their trap by blaming them. Take accountability even when the finger is pointed at you. During a high pressure international forecast call, a vice president of product management blamed each country leader for below plan performance in his product line. Each county leader had implemented action plans and struggled through the recession, but clearly this VP never did take the mirror test on how he can support the country leaders. It’s tough taking body blows when numbers are below expectations. Rather than blame the economy or marketing, work with your European counterparts or others to identify best practices, so that you can regain confidence and momentum in the US among other functional leaders.
Tell a story when communicating your leadership system
A medical diagnostic company created a one-page leadership system using an Excel template. At the top of the cascade chart was the vision, followed by the mission, core values, strategies, key success factors and metrics. What I was most impressed with was not only did most employees post their leadership system on their cubicle wall, but also they exemplified core values such as delivering on customer commitments. Their actions showed that meeting customer expectations for quality were more important than shipping hastily at the end of the quarter for revenue.
One actionable step to communicating your leadership system is by your weekly conference calls out to your team. Collect success stories relevant to strategy execution and core values. For instance, one of our sales reps, Harry, sold a new technology that required team selling to Pfizer. Because one of our strategies involved cross selling with other team members at strategic accounts, I recognized Harry by recalling the story of the Pfizer order.
Key Success Factors
Here’s our first of three key success factors. These factors are from the research completed with the APQC. They represent the most common barriers to strategy execution.
Integrity is doing what you say even when others are not looking. Build trust between frontline employees and management by exemplifying and reinforcing the core values and strategies of the organization thru alliance building interviews, personal accountability and telling stories
Navigate the blueprint into the hearts of your team.
Navigating the message to sales team members is assessing their abilities and motivation, adapting your leadership style and giving laser-focused feedback to your team. This stage is the pivot point that can sustain profitable growth.
Assess your team abilities and attitude.
In order to assess abilities, focus on the one or two mission critical tasks important to execution of strategy. One key task might be new account development. Assessing your team’s new business development abilities can be accomplished by applying the best practices separating exemplary from average performers. On attitude, determine if your team members have the confidence to make new introductions. One way to discover attitude is by weaving questions into your alliance building interviews such as how they view success in getting new business vs. servicing existing business? High performing representatives work deals and develop partnerships with other suppliers, so they can leverage partnerships into multiple new orders. Meanwhile, the average performer may simply focus on activity like making 10 new calls a week, and they may spend most of their time visiting existing customers.
Adapt your leadership style to each member of your team with laser-focused feedback.
The difference among direct reports is one of the most stated first impressions of new sales managers. Moving from awareness to being intentional can motivate and gain trust between the new manager and their direct reports.
One intentional approach is applying Blanchard’s Situational Leadership Styles[i](SLS). SLS creates a matrix, whereby you list high and low along both the x and y-axes. One axis is labeled confidence and the other axis abilities. The essence of Blanchard’s model is that there are two styles: directive and supportive. A directive style is comparable to mentoring a sales representative in that you provide the objectives and the tasks to accomplish your organization’s goals. Usually this style is reserved for a new hire or to jump-start an underperforming team member. The supportive style asks the right questions to get your rep unstuck, so that he can develop breakthrough objectives and tasks. For example a sales representative with low confidence/ high abilities and low performance is best served with a supportive leadership style.
After adapting your leadership style (directive or supportive), provide laser-focused feedback aligned with your leadership system, keeping communication simple. It’s great to emphasize profitable growth as part of a strategy, but when your feedback reverts to statements like, “What price do we need to come in to get this order?” profitable growth will become a slogan.
Key Success Factor: Ask your direct reports for feedback on your leadership style every six months on what they wish you would continue, stop and do more of.
Farming the right behaviors and metrics
Summarizing, the Architect stage engages the mind with the blueprint or leadership system. The Navigate stage engages the heart by your sensitivity to different team member abilities and confidence. Now it’s time to get the hands working. The Farm stage is where most of the go, go, go initiatives start. Our first principle focuses on how we can engage the hands of our team.
Progressively improve performance thru just in time performance management and training.
You might discover that one of your reps is not covering a high potential part of their territory. Besides advising your rep to get out into the territory more, what if you asked them to develop their own goals for maximizing territory coverage? If your rep lacks territory management skills, you might have to be directive and lend a helping hand to create their first goal-setting plan.
Make sure your goal setting session is tied to your performance management process. This will enable you to revisit goals aligned to your performance management process on a quarterly to monthly basis. Two results follow: 1) Your direct reports know their performance rating before the annual performance review 2) You have aligned one of your strategic systems with field operations.
Reinforce desired behaviors thru informal rewards.
Once you start to observe progressive improvement in goals, develop a unique approach to rewarding those reps, who are continually improving their behaviors aligned with your leadership system. Why not develop a monthly informal reward system for your sales team? Each month the rep who attains quota performance and achieves the most new customers- a possible aligned goal with your strategies- receives an informal reward. By continually communicating, recognizing and rewarding the desired behaviors and performance, your team will not only feel appreciated and recognized, but also they will learn from your leadership.
Key Success Factor
Avoid the folly of measuring and rewarding for A while you hope for B.
Is there any difference between organizations that do/do not use a systematic approach to strategy execution? Besides the study that Jocelyn Davis and Tom Atkinson completed, my personal experiences reveal a significant difference. The absence of a systematic approach resulted in a hit or miss aim at our sales targets. It’s like throwing darts at a dartboard to get at your number. With an approach like the one mentioned here, our sales management team’s effectiveness soared, sales representatives were inspired to our leadership system, and most important we advanced our sales organization and customers’ businesses during one of the most difficult economic periods.
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