Monday, November 17, 2014

Alignment: A Foundation for Lasting Revenue Growth

Your ability to win or lose more business is about alignment - configuring and calibrating key aspects of marketing and sales execution to optimize revenue growth. What this asserts is that the extent to which the organization consistently meets revenue targets is directly proportional to the degree of alignment between the organization's parts and its strategic priorities.Sustaining top-line revenue growth is an ongoing challenge for most companies. It's no secret that one of the most critical challenges facing every 21st century organization is consistently delivering against the #1 driver of long-term company success-top-line revenue growth. Over the past decade of working with CEOs to design and deliver better long term revenue performance, I've seen and see, that those unable to sustain success routinely lack much of a coherent or comprehensive plan. Moreover, their teams have little understanding of how it all comes together and what their roles are, and/or the sequencing of events in achieving future plans.When it comes to alignment, perception and reality often differ. That said, most executives think their companies are aligned. Over the past few months, they've put plans in place to align the organization and focus their resources to achieve maximum growth. They've organized a series of group and one-on-one meetings throughout the organization to communicate key initiatives, priorities, and growth expectations and get everyone on the same proverbial page. They sincerely believe that they are leading well-aligned companies, with all members of the management team and every employee clear on the rationale behind the strategic plan and their own priorities and accountabilities to support the plan, with specific time frames articulated.But the facts tell a different story.• 85% of executive teams spend less than one hour per month discussing strategy. (Norton)• 54% of executives say that company's capabilities do not reinforce one another (Booz@Co.)• Two-thirds of support units are not aware of corporate strategy or aligned with their own business unit's strategy. (Norton)• 60% of organizations don't link budgets to company strategy.(Norton)• 95% of employees claim they are not aware of company strategy.(Norton)It's clear that organizations may not have their resources as well aligned as they think. Managers would do well to ask themselves and their teams the following questions:• Are we all synchronized and systematically working towards the same objective-driving healthy revenue growth.• Do we know the big picture and where we individually and collectively fit into that process?• Are we clear on the critical factors that drive growth, there dependencies and that we've providing proper context for daily decisions being made in support of those objectives?• Will the cumulative decisions we make individually and collectively support us in reaching our revenue objectives?What exactly is alignment? Alignment means we're all on the same page, pulling in the same direction. All levels of the organization understand the strategic plan, the critical initiatives that will help to accomplish the objectives, and their individual and/or departmental role in achieving them. In my experience the most successful organizations have implemented a consistent framework for translating their strategy into well-defined initiatives across the company, in the form of objectives, incentives, time frames, and accountabilities for each department, team, and individual.

Without alignment, it's difficult-if not impossible-for workers in an organization to have context for the decisions they're making. Alignment and context allow an organization to move confidently beyond its current state to its future desired state.Alignment is such a simple concept; why is it so difficult to achieve? The importance of aligning the team is hard to dispute, and it seems logical and obvious. But when you consider that strategy is set by very few, maybe once or twice a year, yet the real work is done over a long stretch by many who weren't in those strategy meetings, you start to see the issue. The workers who ultimately carry out the mission have little understanding about how that strategy was reached, and they had no input on whether they think the strategy is plausible given the reality of resources, budgets, and competition they see out in the field. The result is that most do not have proper context for making good decisions in their daily work.When you think of all the possible decisions that are made daily, one or two bad calls might appear to have little impact in the overall scheme of things. Most leaders may never be aware of these tactical decisions, or only find out about them when review meetings take place after the fact. But collectively, over time, decisions made outside the context of the organization's overall direction will drive inconsistency and have significantly negative impact, with little opportunity to recover. This can result in confusion and unnecessary chaos, ultimately reducing the odds for success while driving down productivity and draining morale.Alignment can be the difference between business success and failure. CEOs struggle each day with new challenges and increased complexity both within their companies and in the external environment. The percentage of companies that have consistently achieved even a modest rate of growth of over 5% for 10 years or more has continued to drop, and the business environment isn't getting any easier.Why do some companies succeed where others fail? When you think about it, all companies have the same basic ingredients: unique products or services, value propositions, a marketing budget, managers, leaders, people, buildings, metrics, etc. But, within each organization, the system can't perform to its highest levels unless its constituent parts are aligned.Think of professional sports teams. They all have the same ingredients: players, managers, owners, equipment, stadiums, playbooks, the best athletes, etc. Each is a system that is trying to become more successful than its competitors. What brings success? Alignment of the constituent parts. This rule applies equally to championship sports teams, Ferraris, and corporations. For the latter, it means developing and implementing a strategic framework that is translated into specific objectives and measurable initiatives. This framework galvanizes, links, and governs the entire organization, bringing more consistent and repeatable high performance.Hitting your revenue growth expectations is proportional to your team's degree of alignment. What becomes paramount is how well the organization can become aligned in order to move faster, make better decisions, and ultimately win more than the competition. This will allow leaders to more successfully align and optimize the collective resources to achieve key initiatives. This is a critical step in becoming more consistent in winning more than your competitors and, as such, should be a managed and formalized process that executives focus on for the long haul.

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