The 10 Principles of Organizational DNA

https://www.strategy-business.com/blog/The-10-Principles-of-Organizational-DNA?gko=c5b42&utm_source=itw&utm_medium=20180531&utm_campaign=resp

Very interesting article

Amid the turbulence of changing business environments and personnel, 10 precepts have remained useful, for empowering people and unlocking any organization’s potential. 

1. There are only a few organizational personality types. Every company may seem unique, but in their enterprise-wide behavior, they fall into just seven behavioral patterns (in order from the least to most effective at execution): passive-aggressive, over managed, outgrown, fits-and-starts, just-in-time, military-precision, and resilient. People who take our online survey (the Org DNA Profiler®) continue to identify their company as one of these archetypes, regardless of industry and geography. That means that, no matter how pernicious a performance problem may seem, other companies have undoubtedly faced it before —and some have prevailed, often by changing their organizational personality. 

2. Companies are mosaics of personalities. Most companies contain a mix of personalities—having two or three, or more business units that fall under different archetypes. This is especially true of companies that have made major acquisitions. For example, a 20-year-old technology powerhouse might be a resilient organization. But its newly acquired health-tech division matches the fits-and-starts profile, characterized by smart entrepreneurial talent but a lack of collective discipline. 

3. Weak execution is prevalent. The connection between the organization’s personality type and how well the organization executes on strategy is always strong. When we analyzed our most recent data set (more than 20,000 respondents), we discovered that a whopping 48 percent fit a profile distinguished by weak execution. And 11 percent fit into the most vexing of those profiles: the passive-aggressive organization, in which people pay lip service to results but consistently undermine the necessary efforts. 

4. Strong execution is not self-sustaining. The 52 percent of respondents with a strong-execution archetype can’t afford to be complacent. In our experience, even a company with the most desirable profile, the resilient organization, must continually work to stay at the top of its game. For example, its leaders should relentlessly seek feedback from those closest to the market, encouraging and acting on criticism from customers and front-line employees, and taking action to address minor issues before they become bigger problems. 

5. Performance is based on interdependent factors. Your organization’s DNA is made up of four pairs of building blocks: decision rights and norms, motivators and commitments, information and mind-sets, and structure and networks. The way that the building blocks combine determines your company’s aptitude for execution. It is crucial, then, for companies that want to improve their execution to consider the building blocks as a whole and not individually. 

6. The org chart isn’t the solution. Many company leaders fall into a common trap: They think that changing their organization’s structure will solve their problems. They may remove significant management layers and temporarily reduce costs that way—but all too soon, the layers creep back in and the short-term efficiencies disappear. We see structure as the capstone, not the cornerstone. It’s better to change other formal elements first, like decision rights, motivators, and information flows, and then figure out the structural changes needed to support the revitalized company. 

7. Intangibles matter. Those formal organizational DNA elements are attractive to companies because they’re tangible. They can be easily defined and measured. But they’re only half the story. Companies often realize this after they’ve made significant changes—reassigned decision rights, reworked the org chart, established new incentives, or set up knowledge-sharing systems—yet don’t see the results they expect. That’s because they ignored the informal, intangible elements. These include norms (what people think is the right way to behave), commitments (the promises people feel motivated to keep) mind-sets (deeply held attitudes and beliefs), and networks (connections among employees outside the formal structure). They add up to influence the ways people think, feel, communicate, and behave. Until you learn to influence these factors, your efforts to build performance will be unbalanced. 

8. Decision rights and information flows deliver. Decision rights and information traits are twice as powerful as structure and motivators in driving organizational effectiveness. We analyzed dozens of strong-execution companies and discovered that information had the strongest correlation to execution, at 54 percent, and decision rights correlated at 50 percent. Structure came in at 25 percent. That may be why we see more and more companies making smart use of digital information technology to differentiate themselves. But these changes can also be low-tech. One company boosted its performance by setting up regular meetings to ensure that people at the top and the bottom of the hierarchy were regularly talking together, and information flowed more effectively among them. 

9. Informal factors change when you focus on what works. The best approach for improving intangibles like norms and commitments is to use them as a force for transformation. So, instead of trying to change the culture of your company, use your intangible strengths to help improve it. Suppose your company is losing customers despite having a deep commitment to customer service. By focusing attention on a few powerful and positive behaviors, you can draw out that commitment and boost customer retention rates. 

10. High performance can’t be isolated. Rarely do departments or business units work in isolation. Changes are more likely to last when they’re made holistically, across a company or division. Manufacturing needs to know what sales intends to sell, and sales, in turn, needs to know what marketing will promote. The more connectivity among different groups or functions, the more effective they can become.

Create Three Distinct Career Paths for Innovators
• Gina Colarelli O’Connor
• Andrew Corbett

• Ron Pierantozzi
https://hbr.org/2009/12/create-three-distinct-career-paths-for-innovators?autocomplete=true


Remember our work at Kellogg and MDG—we need the right skills along the growth journey

Big companies are much better at incremental innovation than they are at radical innovation. That’s as true now as it was 20 years ago, despite countless programs aimed at strengthening innovation capabilities. To understand why, researchers at Rensselaer Polytechnic Institute studied 21 large companies’ efforts to build a capability for breakthrough innovations over several years. They found that even though companies pay lip service to innovation, most fail to provide the formal structure and support that programs need to succeed, such as an autonomous organization, processes tailored for highly uncertain work, and well-designed metrics. 

What’s more, the research reveals that companies fundamentally mismanage their innovation talent. Typically, large companies rotate high-potential managers in and out of the innovation leadership role on a regular basis. That may give the rising stars broad experience, but it deprives the company of any real innovation expertise at a senior level. Even more damaging, companies don’t provide meaningful growth opportunities for their innovation professionals. So although there are plenty of great jobs in innovation, there are no careers. One member of an innovation hub in a large consumer products company explains, “I could help launch $4, $5, $6 billion businesses over the next five years, and I won’t get promoted into leadership for this company.” 

To remedy that problem, companies must first understand that breakthrough innovation consists of three phases: 

Discovery: Creating or identifying high-impact market opportunities.Incubation: Experimenting with technology and business concepts to design a viable model for a new business.Acceleration: Developing a business until it can stand on its own.

Consider the unique competencies each phase requires. During discovery, employees often do bench science or technological experimentation as they think about how an innovation might satisfy a marketplace need. During incubation, employees experiment recursively with technology and market opportunities and try to anticipate the impact the breakthrough business may have on the company’s strategy. During acceleration, established-business capabilities such as scaling up processes, imposing discipline, and specialization are needed. Each phase lends itself to distinct career paths, as well. The bench scientist, for instance, may eventually want to be involved in policy discussions about emerging technologies and how they may influence the company’s future. The incubator may want to pursue a technical path—managing larger, longer-term projects—or to manage a portfolio of emerging businesses. And the accelerating manager may want to stay with the business as it grows, take on a leadership role in a functional specialty, or move into other general-management roles in the corporation. 

Rather than develop those paths, however, many firms assume that an individual will be promoted along with a project as it grows from discovery through to acceleration. In reality, individuals with that breadth of skill sets are extremely rare. In other words, companies have essentially been setting their innovators up to fail. Imagine how much a company might improve its innovation if it allowed workers who excelled in, say, the discovery phase to focus on emerging innovation opportunities rather than forcing them to acquire the skills needed for incubation or acceleration. The accompanying exhibit can serve as a guide for executives who are ready to build career paths for their company’s innovators—and to reap the rewards of a sustainable innovation function.

Why Companies Need to Build a Skills Inventory
Jeff Hesse

https://www.strategy-business.com/blog/Why-Companies-Need-to-Build-a-Skills-Inventory?gko=8b016&utm_source=itw&utm_medium=20180425&utm_campaign=resp

Critical for the future –dollars are fungible, people are not

Here’s a question every leader should answer: Do you have a clear understanding of your people’s skills, and where the gaps are? 

Odds are, the answer is no. Although the cloud, digitization, and the Internet of Things allow businesses to gather and analyze all sorts of data, few organizations today have a system in place to track the skills they have. And even fewer apply that knowledge to gauge what skills they lack, both now and in the future — which presents a challenge, given that in tomorrow’s automation- and data-driven workplace, talent will be scarce and the needs of your organization will change often. 

It’s clear that digital disruption is already here. In our Workforce of the Future study, which draws on research begun in 2007 by a team from PwC and the James Martin Institute for Science and Civilisation at the University of Oxford’s Saïd Business School, we envision what the workforce will look like in 2030. While it’s impossible to predict exactly the skills businesses will need even five years from now, every scenario we imagine will require workers and organizations to be ready to adapt. PwC’s most recent CEO survey found that more than half of CEOs said they were exploring how machines and humans can work together. And 39 percent said they’re considering the effect automation will have on their workforce. 

Even now, with automation still in its early days, CEOs told us that finding the skills they need has become the biggest challenge to their business — a situation that will only get more acute as technology evolves and competition for talent tightens. Companies in a range of industries are scrambling to find people who can work with AI or train industrial robots, disciplines that may have been esoteric just a few years ago.Given the dynamics, it is vital for you to have a system in place that can track and analyze the skills your people already have — and those they may need soon. Building such a system is a significant undertaking. Breaking it down into four steps can help you get started. 

Step 1: Make an inventory of your people’s dynamic skills. Before you can even begin to think about the future, you need to know what skills your people have. Start by considering the particular skills your business needs, and then categorize them. This categorization could be done by functional skills, such as financial modeling or accounting, or by technical skills, such as programming. While doing so, you should also categorize the level of those skills, from novice to expert. It’s also important that employers look beyond workers’ job titles to consider what skills they have that they may not be using.Next, think about the best way to inventory those skills. Organizations that are small- to medium-sized don’t necessarily need a high-tech solution to create this inventory — it could be a simple system in conjunction with your HR platform, or even just a spreadsheet.Larger companies with hundreds or thousands of employees will need a more advanced technological solution, such as an app. At PwC, we created a widely available app called Digital Fitness Assessment. We’ve been using this easy, intuitive workforce platform to help our people assess their own technology skills and create personal learning paths to improve professional development. Imagine if your organization had a candid assessment of your people’s digital proficiency.Creating an inventory can’t be a one-time exercise, or a static project. You’ll need to update it as your people’s skills evolve, as your organization’s needs change, and as people come and go. 

Step 2: Organize your inventory. Once you have the basic inventory in place, begin to organize it in a way that makes it highly searchable. The key here is to make sure you can search and access the data quickly, with good results. The inventory won’t be useful if you can’t efficiently search for a specific skill or attribute, or easily access the information you need.CEOs told us that finding the skills they need has become the biggest challenge to their business.Free-form keywords aren’t reliable, because someone might refer to a certain skill using one term, while someone else might call it something different. One person’s “coding” might be another person’s “software writing,” or people may describe sales skills in fundamentally different ways. So it’s critical to figure out how you can organize the data to produce useful query results. Or you can implement a powerful search engine that doesn’t rely on how the data is organized. 

Step 3: Analyze your skills. With the data in place, you can begin analyzing it. This can be simple (comparing rows on a spreadsheet) or more complex (using people analytics or apps to find and assess certain skill sets). The goal here is to gain insight into where your employees’ skills are the strongest, where they’re thin, and where the gaps are, and then whether those gaps are on the functional side or the technical side.As with building the inventory, analysis isn’t a one-time exercise. How closely you track your people’s skills depends on the needs of your business. In manufacturing or retail, where a lot of people may be doing the same job, you might not need to track skills too closely (unless you’re looking at roles you’re seeking to transform). But if your organization demands certain unique skill sets, such as those in financial services, pharmaceuticals, or some highly technical industries, you’ll want to give skill tracking more time and attention. 

Step 4: Plan for the future. Once you’ve built an inventory and analyzed your people’s skills, you can start planning for the future. Trying to gauge the skills your company will need two to three years down the road with a few viable scenarios can be a valuable exercise. Rather than being caught off guard by a sudden gap in skills or having to hire people with certain skills at the last minute in the open market, companies armed with such knowledge can plan ahead through hiring, training, and career development strategies. 

These steps inform a broader workforce strategy. It’s important not to forget that planning your strategy shouldn’t happen in a vacuum — it should always be connected to larger, unified business goals. All functions must work together to build a skills plan for the future. 

There’s a lot we don’t know about tomorrow. But workers and organizations should be as ready as possible. By identifying the skills you need and starting to concentrate on how to build them, you’ll be better prepared for the changes coming your way.

20 Questions for Business Leaders Part 3

The entire history of management ideas can be seen as a series of answers to a few pragmatic queries.

by Art Kleiner and Nancy A. Nichols

https://www.strategy-business.com/feature/20-Questions-for-Business-Leaders?gko=e2585&utm_source=itw&utm_medium=20180222&utm_campaign=resp

HOW DO WE PREPARE FOR UNCERTAINTY?

Watch out for megatrends.

All of business is affected by great sweeping forces: demographic and social change, shifts in global economic power, rapid urbanization, climate change and resource scarcity, and technological breakthroughs.

Alvin and Heidi Toffler, Future Shock, 1970

John Naisbitt, Megatrends, 1982

PwC, “How to Seize Opportunities When Megatrends Collide,” s+b, 2015

Anticipate black swans.

You can’t predict or avoid impossible calamities, but you can develop your company’s ability to cope. Nassim Nicholas Taleb, Black Swan, 2007

 Invent your own certainties.

“The best way to predict the future is to create it.” Alan Kay, Xerox Palo Alto Research Center, 1971

Pay attention to the way you pay attention.

“How can I know what I think until I see what I say?”

Karl Weick, Sensemaking in Organizations, 1995

Imagine multiple scenarios.

Explore several possible futures to raise your awareness of the present and help you make better decisions by distinguishing predetermined events from critical uncertainties.

Royal Dutch Shell Group (home to Pierre Wack, Ted Newland, Arie de Geus, Peter Schwartz, and other business thinkers), 1971; “The Man Who Saw the Future,” s+b, 2003

20 Questions for Business Leaders -Part 2
The entire history of management ideas can be seen as a series of answers to a few pragmatic queries.
by Art Kleiner and Nancy A. Nichols

https://www.strategy-business.com/feature/20-Questions-for-Business-Leaders?gko=e2585&utm_source=itw&utm_medium=20180222&utm_campaign=resp

An interesting article. Over the next three postings, I’ll summarize three of the questions. I urge going to the article to get a fuller picture.

WHAT DO WE KNOW ABOUT CHANGE?

Change works best in small groups.

In small groups, people learn collective self-awareness. Kurt Lewin, Edith and Charles Seashore, 1930–46

Your culture is your ally.

Identify and promote a critical few people, attributes, and behaviors that point in the right new direction. Jon R. Katzenbach and others, “Stop Blaming Your Culture,” s+b, 2011, and “The Critical Few,” s+b, 2014

Only the paranoid survive.

Disrupt your own success, or someone else will. Andy Grove, Only the Paranoid Survive, 1996

Systems change in nonlinear ways.

You have leverage if you recognize the accelerating and balancing feedback in system dynamics. Can you ride the waves of change around you? Jay Forrester, Industrial Dynamics, 1961; “The Prophet of Unintended Consequences,” s+b, 2005

Changing a company is like running a campaign.

Articulate the urgency, set goals, organize a team to lead change, win hearts and minds, and roll out the new regime. John Kotter, Leading Change, 1996

Be agile.

Strategic responsiveness is the ability to sense new risks and new opportunities in the business environment and to quickly craft a response to those pressures.

USC’s Center for Effective Organizations, “The Agility Factor,” s+b, 2013

PwC’s Technology Industry Advisory Practice, “Agility Is Within Reach,” s+b, 2015

20 Questions for Business Leaders -Part 1
The entire history of management ideas can be seen as a series of answers to a few pragmatic queries.
by Art Kleiner and Nancy A. Nichols

https://www.strategy-business.com/feature/20-Questions-for-Business-Leaders?gko=e2585&utm_source=itw&utm_medium=20180222&utm_campaign=resp

An interesting article. Over the next three postings, I’ll summarize three of the questions. I urge going to the article to get a fuller picture.

HOW DO WE WIN?

Build your knowledge, appear weak while growing strong, and when you’re ready, strike decisively.

“He will win who knows when to fight and when not to fight. He will win who knows how to handle both superior and inferior forces. He will win who, prepared himself, waits to take the enemy unprepared.” Sun Tzu, The Art of War, 500 BC

Plan for your plans to fail.

The “fog of war” means that strategists must continually contend with chance and emotion. Prussian General Carl von Clausewitz, On War, 1832

Become a monopoly.

American Telephone and Telegraph avoided competition for 75 years by guaranteeing the U.S. government universal telephone service in exchange for the sole right to a nationwide phone system. Theodore Vail, first president of AT&T (and Alexander Graham Bell’s protégé) (1913–1982)

Build big strategic-planning operations.

Hire experts — the more, the better — put them in teams, and ask them to develop elaborate plans. It worked for major companies in the 1960s, didn’t it? Kenneth R. Andrews

Diversify.

Hedge your exposure to the business cycle, combining diverse businesses and relying on your own expertise to hold them together.

Gulf + Western, Hanson, ITT, Jardine Matheson, Mitsubishi, Tata Group, and others

Stake out a competitive position.

Choose a strategy defensible against “five forces”: substitution, competition from established rivals, competition from new entrants, bargaining power of suppliers, and the bargaining power of customers.

Michael Porter, seminal theorist of the positioning school of strategy and author of Competitive Strategy, 1980

Compete on core competencies.

Develop a “bundle of skills and technologies” for an edge. C.K. Prahalad and Gary Hamel, “The Core Competence of the Corporation,” Harvard Business Review, 1990

Execute excellently.

Focus your top leaders’ attention on operational prowess: Become a high-performance company. William Abernathy and Robert Hayes, “Managing Our Way to Economic Decline,” Harvard Business Review, 1980

Larry Bossidy and Ram Charan, Execution, 2002

Let a thousand flowers bloom.

Try as many options as possible. Embrace those ventures that work, discard those that don’t, and adjust your strategy rapidly as circumstances change. Henry Mintzberg, The Rise and Fall of Strategic Planning, 1994

Compete ruthlessly.

Make yourself stronger by taking advantage of your competitors’ weaknesses. George Stalk and Rob Lachenauer, Hardball, 2004

Keep asking, “Why does the world need this company?”

Leaders become better strategists by engaging in conversations about the purpose of the company. Cynthia Montgomery, The Strategist: Be the Leader Your Business Needs, 2013

Close the gap between strategy and execution.

A truly winning company is coherent: It manages itself around a few differentiating capabilities — and integrates them with every aspect of strategy and execution, across everything they do. Cesare Mainardi and Paul Leinwand, The Essential Advantage, 2011, and Strategy That Works, forthcoming, 2016

Starting a Transformation? Don’t Change Everything!

Elizabeth Doty

https://www.strategy-business.com/blog/Starting-a-Transformation-Dont-Change-Everything?gko=302aa&utm_source=itw&utm_medium=20180118&utm_campaign=resp

Great perspective when faced with having to change your organization to enhance performance.

As organizations of all types — in both the public and private sectors — strive to be more agile, they reorganize more often. Executives are asked to take on new teams, merge related teams, or pivot to a new set of priorities. Such challenges can be exciting: As a leader, your mind may be buzzing with ideas, questions, and possible solutions. The pressure is on, and you are eager to put “points on the board.” 

Yet, for your team, a reorganization may involve a reset as much as a new direction. When things are in flux, people naturally tend to slow down on special initiatives — they don’t want to risk marching in the wrong direction. As new players are assigned, processes can easily become muddled, handoffs dropped, and best practices forgotten. Individuals are not yet familiar with one another’s quirks and talents, and may be feeling the loss of their former teammates. 

Moreover, even after you set the direction and clarify roles, your team may still hesitate until they trust that new commitments will persist over time..,. 

 
….The trick is to recognize that your team is already in motion. In one form or another, initiatives are under way, ideas are being discussed, processes are in place, and relationships have developed. Even if your charter is to radically change course, chances are there is much that you can repurpose or redirect. By taking the time to uncover what is happening on the ground now and affirming explicitly what you want to continue, stop, or start anew, you can dramatically reduce the reset effect. To put this in practice, consider holding three types of conversation early on in your tenure with a new team. 

1. The “team story line” conversation. Although it is very tempting to focus only on the future, take some time to learn about your new team’s journey. Ask them: What have been your priorities and goals over the past year? What have you accomplished? What have been the biggest breakthroughs? Where are you focused now?...  

2. The “new challenge” conversation. This is where you share the larger opportunity or need the team is being asked to address. Get creative, and try to bring this new challenge to life as vividly and concretely as possible, building on what your team already knows and understands…..  

3. The “realign the work” conversation. Now, with shared understanding of direction, you and your new team can outline what you need to change in practice. Review your goals, roles, processes, team commitments, and the dashboard of measurements you use to track progress. Then, determine together what you need to continue, stop, or start to deliver. … 

…..As satisfying as it is to generate your own ideas, you and your team will get to results most quickly by tapping into efforts already under way wherever possible. You may be surprised by how flexible your team is if the new focus is clearly articulated in ways that directly relate to their prior goals. For their part, team members can help new leaders by highlighting work they can leverage. For example, the senior director above eventually invited the new governor to review the current initiatives and the impact they were having, then asked his input on 

5 Questions to Help Your Employees Find Their Inner Purpose

Kristi Hedges

https://hbr.org/2017/08/5-questions-to-help-your-employees-find-their-inner-purpose

Very important and often overlooked

Organizations spend considerable resources on corporate values and mission statements, but even the most inspiring of these — from Volvo’s commitment to safety to Facebook’s desire to connect people — tend to fade into the background during the daily bustle of the work day.

What workers really need, to feel engaged in and satisfied by their jobs, is an inner sense of purpose. As Deloitte found in a 2016 study, people feel loyal to companies that support their own career and life ambitions — in other words, what’s meaningful to them. And, although that research focused on millennials, in the decade I’ve spent coaching seasoned executives, I’ve found that it’s a common attitude across generations. No matter one’s level, industry or career, we all need to find a personal sense of meaning in what we do…..

…. Regular check-ins that use five areas of inquiry are another way to help employees explore and call out their inner purpose. Leaders can ask

What are you good at doing? Which work activities require less effort? What do you take on because you believe you’re the best person to do it? What have you gotten noticed for throughout your career?

What do you enjoy? In a typical workweek, what do you look forward to doing? What do you see on your calendar that energizes you? If you could design your job with no restrictions, how would you spend your time? What do you enjoy? In a typical workweek, what do you look forward to doing? What do you see on your calendar that energizes you? If you could design your job with no restrictions, how would you spend your time?

What feels most useful? Which work outcomes make you most proud? Which of your tasks are most critical to the team or organization? What are the highest priorities for your life and how does your work fit in?

What creates a sense of forward momentum? What are you learning that you’ll use in the future? What do you envision for yourself next? How’s your work today getting you closer to what you want for yourself?

How do you relate to others? Which working partnerships are best for you? What would an office of your favorite people look like? How does your work enhance your family and social connections?