Month: April 2020

6 Steps to Effective Organizational Change Management

6 Steps to Effective Organizational Change Management

With thanks to Fionnuala Courtney and PulseLearning for their post, shared and fully attributed here:

Are you new to the concept of change management?  Do you want to understand what all the fuss is about?

This quick read from PulseLearning in 2016 is a great introduction to the subject.

Most organizations today are in a constant state of flux as they respond to the fast-moving external business environment, local and global economies, and technological advancement. This means that workplace processes, systems, and strategies must continuously change and evolve for an organization to remain competitive.

Change affects your most important asset, your people. Losing employees is costly due to the associated recruitment costs and the time involved getting new employees up to speed. Each time an employee walks out the door, essential intimate knowledge of your business leaves with them.


A change management plan can support a smooth transition and ensure your employees are guided through the change journey. The harsh fact is that approximately 70 percent of change initiatives fail due to negative employee attitudes and unproductive management behavior. Using the services of a professional change management consultant could ensure you are in the winning 30 percent.

In this article, PulseLearning presents six key steps to effective organizational change management.

1. Clearly define the change and align it to business goals.

It might seem obvious but many organizations miss this first vital step. It’s one thing to articulate the change required and entirely another to conduct a critical review against organizational objectives and performance goals to ensure the change will carry your business in the right direction strategically, financially, and ethically. This step can also assist you to determine the value of the change, which will quantify the effort and inputs you should invest.

Key questions:
• What do we need to change?
• Why is this change required?

2. Determine impacts and those affected.

Once you know exactly what you wish to achieve and why, you should then determine the impacts of the change at various organizational levels. Review the effect on each business unit and how it cascades through the organizational structure to the individual. This information will start to form the blueprint for where training and support is needed the most to mitigate the impacts.

Key questions:
• What are the impacts of the change?
• Who will the change affect the most?
• How will the change be received?

3. Develop a communication strategy.

Although all employees should be taken on the change journey, the first two steps will have highlighted those employees you absolutely must communicate the change to. Determine the most effective means of communication for the group or individual that will bring them on board. The communication strategy should include a timeline for how the change will be incrementally communicated, key messages, and the communication channels and mediums you plan to use.

Key questions:
• How will the change be communicated?
• How will feedback be managed?

4. Provide effective training.

With the change message out in the open, it’s important that your people know they will receive training, structured or informal, to teach the skills and knowledge required to operate efficiently as the change is rolled out. Training could include a suite of micro-learning online modules, or a blended learning approach incorporating face-to-face training sessions or on-the-job coaching and mentoring.

Key questions:
• What behaviors and skills are required to achieve business results?
• What training delivery methods will be most effective?

5. Implement a support structure.

Providing a support structure is essential to assist employees to emotionally and practically adjust to the change and to build proficiency of behaviors and technical skills needed to achieve desired business results. Some change can result in redundancies or restructures, so you could consider providing support such as counseling services to help people navigate the situation. To help employees adjust to changes to how a role is performed, a mentorship or an open-door policy with management to ask questions as they arise could be set up.

Key questions:
• Where is support most required?
• What types of support will be most effective?

6. Measure the change process.

Throughout the change management process, a structure should be put in place to measure the business impact of the changes and ensure that continued reinforcement opportunities exist to build proficiencies. You should also evaluate your change management plan to determine its effectiveness and document any lessons learned.

Key questions:
• Did the change assist in achieving business goals?
• Was the change management process successful?
• What could have been done differently?

With thanks to Fionnuala Courtney and PulseLearning for their post, shared and fully attributed here:

The Six Types of successful acquisitions

Full article with thanks to

Companies advance myriad strategies for creating value with acquisitions—but only a handful are likely to do so.

There is no magic formula to make acquisitions successful. Like any other business process, they are not inherently good or bad, just as marketing and R&D aren’t. Each deal must have its own strategic logic. In our experience, acquirers in the most successful deals have specific, well-articulated value creation ideas going in. For less successful deals, the strategic rationales—such as pursuing international scale, filling portfolio gaps, or building a third leg of the portfolio—tend to be vague.

Empirical analysis of specific acquisition strategies offers limited insight, largely because of the wide variety of types and sizes of acquisitions and the lack of an objective way to classify them by strategy. What’s more, the stated strategy may not even be the real one: companies typically talk up all kinds of strategic benefits from acquisitions that are really entirely about cost cutting. In the absence of empirical research, our suggestions for strategies that create value reflect our acquisitions work with companies.

In our experience, the strategic rationale for an acquisition that creates value typically conforms to at least one of the following six archetypes: improving the performance of the target company, removing excess capacity from an industry, creating market access for products, acquiring skills or technologies more quickly or at lower cost than they could be built in-house, exploiting a business’s industry-specific scalability, and picking winners early and helping them develop their businesses.

Six archetypes

An acquisition’s strategic rationale should be a specific articulation of one of these archetypes, not a vague concept like growth or strategic positioning, which may be important but must be translated into something more tangible. Furthermore, even if your acquisition is based on one of the archetypes below, it won’t create value if you overpay.

Improve the target company’s performance

Improving the performance of the target company is one of the most common value-creating acquisition strategies. Put simply, you buy a company and radically reduce costs to improve margins and cash flows. In some cases, the acquirer may also take steps to accelerate revenue growth.

Pursuing this strategy is what the best private-equity firms do. Among successful private-equity acquisitions in which a target company was bought, improved, and sold, with no additional acquisitions along the way, operating-profit margins increased by an average of about 2.5 percentage points more than those at peer companies during the same period.1 This means that many of the transactions increased operating-profit margins even more.

Keep in mind that it is easier to improve the performance of a company with low margins and low returns on invested capital (ROIC) than that of a high-margin, high-ROIC company. Consider a target company with a 6 percent operating-profit margin. Reducing costs by three percentage points, to 91 percent of revenues, from 94 percent, increases the margin to 9 percent and could lead to a 50 percent increase in the company’s value. In contrast, if the operating-profit margin of a company is 30 percent, increasing its value by 50 percent requires increasing the margin to 45 percent. Costs would need to decline from 70 percent of revenues to 55 percent, a 21 percent reduction in the cost base. That might not be reasonable to expect.

Consolidate to remove excess capacity from industry

As industries mature, they typically develop excess capacity. In chemicals, for example, companies are constantly looking for ways to get more production out of their plants, even as new competitors, such as Saudi Arabia in petrochemicals, continue to enter the industry.

The combination of higher production from existing capacity and new capacity from recent entrants often generates more supply than demand. It is in no individual competitor’s interest to shut a plant, however. Companies often find it easier to shut plants across the larger combined entity resulting from an acquisition than to shut their least productive plants without one and end up with a smaller company.

Reducing excess in an industry can also extend to less tangible forms of capacity. Consolidation in the pharmaceutical industry, for example, has significantly reduced the capacity of the sales force as the product portfolios of merged companies change and they rethink how to interact with doctors. Pharmaceutical companies have also significantly reduced their R&D capacity as they found more productive ways to conduct research and pruned their portfolios of development projects.

While there is substantial value to be created from removing excess capacity, as in most M&A activity the bulk of the value often accrues to the seller’s shareholders, not the buyer’s. In addition, all the other competitors in the industry may benefit from the capacity reduction without having to take any action of their own (the free-rider problem).

Accelerate market access for the target’s (or buyer’s) products

Often, relatively small companies with innovative products have difficulty reaching the entire potential market for their products. Small pharmaceutical companies, for example, typically lack the large sales forces required to cultivate relationships with the many doctors they need to promote their products. Bigger pharmaceutical companies sometimes purchase these smaller companies and use their own large-scale sales forces to accelerate the sales of the smaller companies’ products.

IBM, for instance, has pursued this strategy in its software business. Between 2010 and 2013, IBM acquired 43 companies for an average of $350 million each. By pushing the products of these companies through IBM’s global sales force, IBM estimated that it was able to substantially accelerate the acquired companies’ revenues, sometimes by more than 40 percent in the first two years after each acquisition.2

In some cases, the target can also help accelerate the acquirer’s revenue growth. In Procter & Gamble’s acquisition of Gillette, the combined company benefited because P&G had stronger sales in some emerging markets, Gillette in others. Working together, they introduced their products into new markets much more quickly.

Get skills or technologies faster or at lower cost than they can be built

Many technology-based companies buy other companies that have the technologies they need to enhance their own products. They do this because they can acquire the technology more quickly than developing it themselves, avoid royalty payments on patented technologies, and keep the technology away from competitors.

For example, Apple bought Siri (the automated personal assistant) in 2010 to enhance its iPhones. More recently, in 2014, Apple purchased Novauris Technologies, a speech-recognition-technology company, to further enhance Siri’s capabilities. In 2014, Apple also purchased Beats Electronics, which had recently launched a music-streaming service. One reason for the acquisition was to quickly offer its customers a music-streaming service, as the market was moving away from Apple’s iTunes business model of purchasing and downloading music.

Cisco Systems, the network product and services company (with $49 billion in revenue in 2013), used acquisitions of key technologies to assemble a broad line of network-solution products during the frenzied Internet growth period. From 1993 to 2001, Cisco acquired 71 companies, at an average price of approximately $350 million. Cisco’s sales increased from $650 million in 1993 to $22 billion in 2001, with nearly 40 percent of its 2001 revenue coming directly from these acquisitions. By 2009, Cisco had more than $36 billion in revenues and a market cap of approximately $150 billion.

Exploit a business’s industry-specific scalability

Economies of scale are often cited as a key source of value creation in M&A. While they can be, you have to be very careful in justifying an acquisition by economies of scale, especially for large acquisitions. That’s because large companies are often already operating at scale. If two large companies are already operating that way, combining them will not likely lead to lower unit costs. Take United Parcel Service and FedEx, as a hypothetical example. They already have some of the largest airline fleets in the world and operate them very efficiently. If they were to combine, it’s unlikely that there would be substantial savings in their flight operations.

Economies of scale can be important sources of value in acquisitions when the unit of incremental capacity is large or when a larger company buys a subscale company. For example, the cost to develop a new car platform is enormous, so auto companies try to minimize the number of platforms they need. The combination of Volkswagen, Audi, and Porsche allows all three companies to share some platforms. For example, the VW Toureg, Audi Q7, and Porsche Cayenne are all based on the same underlying platform.

Some economies of scale are found in purchasing, especially when there are a small number of buyers in a market with differentiated products. An example is the market for television programming in the United States. Only a handful of cable companies, satellite-television companies, and telephone companies purchase all the television programming. As a result, the largest purchasers have substantial bargaining power and can achieve the lowest prices.

While economies of scale can be a significant source of acquisition value creation, rarely are generic economies of scale, like back-office savings, significant enough to justify an acquisition. Economies of scale must be unique to be large enough to justify an acquisition.

Pick winners early and help them develop their businesses

The final winning strategy involves making acquisitions early in the life cycle of a new industry or product line, long before most others recognize that it will grow significantly. Johnson & Johnson pursued this strategy in its early acquisitions of medical-device businesses. J&J purchased orthopedic-device manufacturer DePuy in 1998, when DePuy had $900 million of revenues. By 2010, DePuy’s revenues had grown to $5.6 billion, an annual growth rate of about 17 percent. (In 2011, J&J purchased Synthes, another orthopedic-device manufacturer, so more recent revenue numbers are not comparable.) This acquisition strategy requires a disciplined approach by management in three dimensions. First, you must be willing to make investments early, long before your competitors and the market see the industry’s or company’s potential. Second, you need to make multiple bets and to expect that some will fail. Third, you need the skills and patience to nurture the acquired businesses.

Harder strategies

Beyond the six main acquisition strategies we’ve explored, a handful of others can create value, though in our experience they do so relatively rarely.

Roll-up strategy

Roll-up strategies consolidate highly fragmented markets where the current competitors are too small to achieve scale economies. Beginning in the 1960s, Service Corporation International, for instance, grew from a single funeral home in Houston to more than 1,400 funeral homes and cemeteries in 2008. Similarly, Clear Channel Communications rolled up the US market for radio stations, eventually owning more than 900.

This strategy works when businesses as a group can realize substantial cost savings or achieve higher revenues than individual businesses can. Service Corporation’s funeral homes in a given city can share vehicles, purchasing, and back-office operations, for example. They can also coordinate advertising across a city to reduce costs and raise revenues.

Size is not what creates a successful roll-up; what matters is the right kind of size. For Service Corporation, multiple locations in individual cities have been more important than many branches spread over many cities, because the cost savings (such as sharing vehicles) can be realized only if the branches are near one another. Roll-up strategies are hard to disguise, so they invite copycats. As others tried to imitate Service Corporation’s strategy, prices for some funeral homes were eventually bid up to levels that made additional acquisitions uneconomic.

Consolidate to improve competitive behavior

Many executives in highly competitive industries hope consolidation will lead competitors to focus less on price competition, thereby improving the ROIC of the industry. The evidence shows, however, that unless it consolidates to just three or four companies and can keep out new entrants, pricing behavior doesn’t change: smaller businesses or new entrants often have an incentive to gain share through lower prices. So in an industry with, say, ten companies, lots of deals must be done before the basis of competition changes.

Enter into a transformational merger

A commonly mentioned reason for an acquisition or merger is the desire to transform one or both companies. Transformational mergers are rare, however, because the circumstances have to be just right, and the management team needs to execute the strategy well.

Transformational mergers can best be described by example. One of the world’s leading pharmaceutical companies, Switzerland’s Novartis, was formed in 1996 by the $30 billion merger of Ciba-Geigy and Sandoz. But this merger was much more than a simple combination of businesses: under the leadership of the new CEO, Daniel Vasella, Ciba-Geigy and Sandoz were transformed into an entirely new company. Using the merger as a catalyst for change, Vasella and his management team not only captured $1.4 billion in cost synergies but also redefined the company’s mission, strategy, portfolio, and organization, as well as all key processes, from research to sales. In every area, there was no automatic choice for either the Ciba or the Sandoz way of doing things; instead, the organization made a systematic effort to find the best way.

Novartis shifted its strategic focus to innovation in its life sciences business (pharmaceuticals, nutrition, and products for agriculture) and spun off the $7 billion Ciba Specialty Chemicals business in 1997. Organizational changes included structuring R&D worldwide by therapeutic rather than geographic area, enabling Novartis to build a world-leading oncology franchise.

Across all departments and management layers, Novartis created a strong performance-oriented culture supported by shifting from a seniority- to a performance-based compensation system for managers.

Buy cheap

The final way to create value from an acquisition is to buy cheap—in other words, at a price below a company’s intrinsic value. In our experience, however, such opportunities are rare and relatively small. Nonetheless, although market values revert to intrinsic values over longer periods, there can be brief moments when the two fall out of alignment. Markets, for example, sometimes overreact to negative news, such as a criminal investigation of an executive or the failure of a single product in a portfolio with many strong ones.

Such moments are less rare in cyclical industries, where assets are often undervalued at the bottom of a cycle. Comparing actual market valuations with intrinsic values based on a “perfect foresight” model, we found that companies in cyclical industries could more than double their shareholder returns (relative to actual returns) if they acquired assets at the bottom of a cycle and sold at the top.3

While markets do throw up occasional opportunities for companies to buy targets at levels below their intrinsic value, we haven’t seen many cases. To gain control of a target, acquirers must pay its shareholders a premium over the current market value. Although premiums can vary widely, the average ones for corporate control have been fairly stable: almost 30 percent of the preannouncement price of the target’s equity. For targets pursued by multiple acquirers, the premium rises dramatically, creating the so-called winner’s curse. If several companies evaluate a given target and all identify roughly the same potential synergies, the pursuer that overestimates them most will offer the highest price. Since it is based on an overestimation of the value to be created, the winner pays too much—and is ultimately a loser.4 A related problem is hubris, or the tendency of the acquirer’s management to overstate its ability to capture performance improvements from the acquisition.5

Since market values can sometimes deviate from intrinsic ones, management must also beware the possibility that markets may be overvaluing a potential acquisition. Consider the stock market bubble during the late 1990s. Companies that merged with or acquired technology, media, or telecommunications businesses saw their share prices plummet when the market reverted to earlier levels. The possibility that a company might pay too much when the market is inflated deserves serious consideration, because M&A activity seems to rise following periods of strong market performance. If (and when) prices are artificially high, large improvements are necessary to justify an acquisition, even when the target can be purchased at no premium to market value.

By focusing on the types of acquisition strategies that have created value for acquirers in the past, managers can make it more likely that their acquisitions will create value for their shareholders.

Full article with thanks to

The Six Types of successful acquisitions
The impact of the pandemic on insurance mergers

The impact of the pandemic on insurance mergers

Whole article with thanks to

Brokerages negotiating a merger or acquisition don’t have to stop because of the COVID-19 pandemic, a Canadian M&A advisor suggests.

“A good deal can get done. I suspect it may take a bit longer,” said Georges Pigeon (pictured), Montreal-based deal advisory partner with KPMG Canada who has led more than 100 mergers and acquisitions in the financial services sector. “The challenge will be in having meetings. I think, to an extent, that virtual meetings, calls and presentations can happen.”

But whether it’s a carrier, brokerage or independent adjusting firm going through a merger or acquisition, sometimes it is good for management teams to meet face to face, Pigeon said in an interview.

That probably won’t be happening at least in the short term. The World Health Organization declared Mar. 11 that COVID-19 is a pandemic, and the Ontario government is one of several jurisdictions that declared a state of emergency as a result. Ontario has banned public gatherings of more than 50 people. Although insurance is exempt from a province-wide shutdown of business that takes effect Tuesday night, public health officials are still advising people to keep their distance from one another.

“Parts of Canada have gone on lockdown or shutdown over the past two weeks or so,” said Pigeon. “What we are currently seeing is, the (M&A) processes that were ongoing when the crisis really hit don’t need to be stalling. I think a lot of the parties at play are quite conscious that deals don’t get signed overnight.”

If this was happening 15 years ago, it would have been more difficult to execute a merger, Pigeon said Monday.

“If I go back to the start of my deal career, there is no way I could have operated the way I am operating right now,” he said. “During the 2008-09 crisis, I think the technology was good for certain functions, but I doubt I would have been able to operate at the level I am currently operating at.”

This is not to suggest that M&A will continue at the same pace.

“Any deal that was still ongoing when the crisis hit, if the deal was weak to begin with, we would not be surprised that it doesn’t come to fruition. That is both on the carrier and on the insurance services side,” said Pigeon.

“There were obviously some transactions that had been in process in 2019 into early 2020. Some of them came to fruition. Others dropped off, especially when things were a bit weaker, whether in terms of strategic fit whether [the target firm] was actually worth what it was worth. Those ones would have fallen off the table in advance of the crisis.”

Whole article with thanks to

Eight lessons from real-life mergers and acquisitions

Now is a great time to plan for the future development of your business. Customer distractions are at a minimum, and valuable thinking time needs to be used wisely. Merger or acquisition is a strategic growth opportunity that every business should keep under consideration and reading up on what lessons have been learned by others is a good way to shape your thinking. Here are EIGHT real-life lessons shared by Mieke Jacobs and Paul Zonneveld to get you started on your reading list.

Our thanks to…

Change consultants Mieke Jacobs and Paul Zonneveld advise on how to keep your next deal off the ever-growing list of M&A disappointments
It’s widely accepted that that between 70 per cent and 90 per cent of mergers and acquisitions fail to achieve their stated objectives. Despite this terrible record, M&As remain a key strategy for many businesses. Indeed, deal activity is expected to rise again in 2020.

Here are eight lessons that directors can draw on to increase a deal’s chances of success, particularly in the cultural integration phase.

  1. Know yourself and your motives.
    If you buy an entity to make up for something you’re missing and you bring it into your existing system, you’ll end up killing exactly what you wanted to acquire in the first place. Ask yourself: “What is this M&A an excuse for?” A common response will be “our inability to innovate”. Unless you address the factors that extinguished your own capacity for innovation, you will disarm your new partner.
  2. Remember that companies with a strong culture often have an “immune system” that pushes out foreign elements.
    Despite good intentions to build on the strengths of the other organisation, a company with a deeply ingrained culture will often have an overwhelming integration plan that lacks a deeper understanding of the other party. Divergent skills, attitudes and approaches are likely to be disregarded by the dominant partner.
  3. Understand the other organisation and include its history and identity in the new narrative.
    It’s critical to understand the history and repeating patterns of the new partner and to integrate what differentiates it from your business into the merged narrative. This will help you to identify compatibility concerns early in the integration process.
  4. Be careful not to alienate the acquired firm’s most valued individuals.
    In sectors where knowledge and relationships are crucial, the real value is connected to people. If they walk out and take their expertise and contacts with them, you might end up with a decommissioned asset.
  5. Understand that family businesses add another layer of complexity.
    Acquiring or merging with a family business often requires extra discernment, transparency and restoration. The underlying dynamics of a family system will play out in the organisational system, despite its members’ best intentions to keep their work and private lives separate.
  6. Consciously build the new organisation.
    “We start anew” is a phrase that’s often heard after big acquisitions. But it can be hard to negate past events, both good – the glorious early days – and bad – the recent loss of colleagues and/or corporate identity. Only by properly addressing these can you start building the new organisation’s values, methods and culture.
  7. Establish the right pecking order and beware of the power of hidden loyalties.
    Tenure, technical expertise and even nationality are some of the factors that might have made people successful in the past, but after integration you might need totally different criteria, which will be defined by the new organisation’s purpose. Given that synergy plans often result in the reshuffling of leadership teams, remember that hidden loyalties can undermine the new order.
  8. Don’t put the “integration burden” on your customers.
    When making your integration plan, you should pay special attention to your customers. Research shows that they seldom benefit from M&As among their suppliers. The “integration burden” often lands in their laps, as they are asked to build new relationships, follow new procedures and adopt new specifications.
Eight lessons from real-life mergers and acquisitions
Make Your Change Management Projects Work With This Proven Three-Step Sequence

Make Your Change Management Projects Work With This Proven Three-Step Sequence

Everyone likes a three step plan. Simple to follow and explain to colleagues and even customers. Here is a really good one from Phil Lewis if you are struggling to think how to start when needing to plan for change in your organisation.

Whole article with thanks to

The secret of Tony Blair’s political success, according to many colleagues and commentators, was that he was able to parse the difference between strategy and tactics better than any other politician of his era. 

By way of contrast, David Cameron—in many ways an emulator of Blair’s approach—did not share this ability. Cue, amongst less consequential matters, Brexit—a political earthquake caused by confusing a tactic (offering a referendum on EU membership) with a strategy to address the party-political threat of nationalism and the resurgence of right-wing political groups.

In organizational change work, it can be tempting for leaders to overlook what appear to be ‘basics’—such as ensuring that distinction is driven between strategy and tactics. Instead, those in charge can exhibit a tendency to jump to more complex considerations—organizational design, say, or operating model reinvention. This is akin to building a house without bothering to lay foundations. Even the world’s most sensitively designed operating model will fail to catalyze effective ways of working if those required to embrace it have zero clarity around what strategy the model is serving.

Claire Croft, an executive coach who works with C-Suite leaders in categories such as marketing, financial services and manufacturing, suggests that such oversights are often a consequence of complexity. “Too often leaders rush into change without defining what they’re trying to achieve—either in terms of the change journey itself or the organizational aims that the change journey is serving,” she says. “It can be hard to see the picture when you’re living in the pixels.”

Will Nicholson, a business change expert who has successfully delivered large-scale change projects at the likes of Lloyds Banking Group and Co-operative Financial Services, agrees. In work as in life, he says, “the basics represent the highest level of skill.” This is a significant point. Locking down the fundamentals of strategy may not be glamorous—but is non-negotiable. “It’s the simple things that contribute significantly to successful change, not the latest technological show-pony or sexy-sounding initiative,” he adds.

So, if you’re trying to lead through change, how do you get the basics right? Here is a three-step sequence that might look simple—but in reality represents change management mastery in action.

Step 1: Define your change ambition

What to do: Start by casting your mind forward 6, 12 and 18 months. What is the change outcome that you and your team want to see at each point—and be able to explain to others? 

Being able to articulate a compelling ambition for the change process outside of your immediate circle is vital. “Too much change management is driven by woolly statements of intent that ultimately set leaders up for failure,” says Claire Croft. “A simple, time-bound and well-expressed ambition creates clarity and confidence.”

What’s more, at this early stage it is vital to do the sometimes difficult work of building consensus. Teams that do not unite around a share ambition are unlikely to stay together on the journey, especially when the going gets tough. Defining the ambition for change, then, often represents a classic case of slowing down to speed up.

What not to do: Get side-tracked by “quick wins.” This can be a big temptation in the early stages of change work, where the desire to demonstrate rapid progress to impatient Boards often serves to distract leaders from the necessary but sometimes slow work of laying the foundations for success.

Step 2: Agree your “vital few” change objectives

What to do: Starting with the six-month ambition, define no more than four objectives that will help deliver it. Ensure that all objectives are fully aligned to your ambition.

Again, getting the agreement of your colleagues at this stage is vital—as is accepting that this process might involve trade-offs. “Too often, objectives are waived through because people aren’t willing or able to consider how well they link to ambitions,” says Croft. “People want to talk strategy without understanding what outcomes the strategy exists to serve.” 

What not to do: Agree more than four objectives—as this will dilute focus. The operative word in this step is “vital”, which means that the objectives must meet two action standards: they are non-negotiable in terms of delivering the ambition, and they animate the change process.

Step 3: Define your strategic plan—and ensure that each tactic supports or aligns into each objective

What to do: Get clear on what strategy actually is: a high-level, practical plan to reach an agreed destination. (If this sounds obvious bordering on patronising, five minutes in the average “strategy” meeting might persuade you otherwise.)

Next, map the tasks involved in the delivery of your high-level plan against your objectives, ensuring that each task meets as many of your vital few objectives as possible. Limit yourself to a maximum of eight tasks. This is where the toughest discussions often need to be held, as there will be further trade-offs to be made. (Consider calling in experts if things get properly challenging.)

Now capture everything on a single page, and review. You will know you have succeeded when there is a clear and incontestable line of sight between your tasks, your objectives, and your change ambition. 

What not to do: compromise on the fidelity of your plan by agreeing tasks where there is no clear line of sight to the agreed objectives. Specifically, be wary of pet projects or “sacred cows” (seemingly non-negotiable requirements), which have a habit of showing up at this point. 

The process described above is innately human: it requires debate and dissent to succeed. But it is the only guaranteed start-point for effective change—for the simple reason that it creates shared clarity around ambitions, objectives, strategy and tactics.

The alternative is to breeze past the basics in the blithe manner of David Cameron. But bear in mind that, while pro-Brexit voters might have been happy with the consequences of his actions, he himself experienced a less optimal outcome—he was forced to resign from his job.

Whole article with thanks to