How to bring strategy execution to your Integrated Business Planning process…or whatever Managing Process you have

You are currently viewing How to bring strategy execution to your Integrated Business Planning process…or whatever Managing Process you have

Mark Blackwell, Arkaro

By bringing more senior executive team involvement to sales & operations planning (S&OP) with Integrated Business Planning (IBP) there was an expectation that this would enable better execution of strategy.

However, too often IBP implementations do not lead to better strategy execution. Why is this and what can be done?

Perhaps your business team does not even have a recognised Integrated Business Planning process, may be more like a monthly management team meeting? It matters not – try this simple question to the team at the start of the meeting.

"What are we doing here?"

The answers can be illuminating. It may be that after a while you’ll here generic responses like

“make budget”

“serve customers better”

“get everyone aligned”

“improve forecast accuracy”

“manage our working capital”

“drive our continuous improvement projects”

 

This is all good stuff no doubt but true for pretty much any business in the world.

Keep probing….

“.. but what are WE doing here and Why?”

Don’t be surprised if the conversation does not flow so well even if using the “Toyota 5 Whys” style probing. This is common and a sign of any of the following within the business team.

There is a strategy, but it fails to have relevance to the day to day running of the business.

Confusion due to multiple views of what the strategy is.

There is a strategy but many in the team have much understanding of what it is.

Or, indeed, there is no strategy.

In my experience, few teams can immediately state the strategy in the same way in less than 30 seconds.

Not convinced? Then try asking these questions:

1. What is our aspiration? What specifically are we trying to achieve? In the short term, long term?

2. What is the bottleneck to our achievement? What is limiting us?

3. What is our strategy to overcoming the bottleneck to achieving the aspiration?

 

1. What are we trying to achieve?

“Make more money” is not an adequate answer. That is an aspiration for all businesses. What are the unique aspiration your organisation is trying to achieve?

An example might be “Increase revenues by 25% over the next two years with our direct customers in Asia Pacific”

Without unambiguous clarity on your aspiration, how can you begin to claim you have a strategy?

2. What is the bottleneck to achieving the aspiration?

Do you hear a common, known answer on what is getting in the way? – or a list of varied and hastily thought through list of suggestions? – or does the organisation align around a common bottleneck such as “our supply reliability does not meet customer expectations”.

3. ..... and what is our strategy to overcoming the bottleneck to achieving the aspiration?

Silence? Mutterings about working together to achieving the common goal? …. or are you one of those fortunate organisations where there really is cross-functional alignment on how to execute the strategy to achieve goals?

If you are then is your IBP processs, or other managing process, designed to help you execute your strategy – and provide signals that course correction might be needed?

Perhaps you have lagging KPIs that tell you whether or not you have achieved your aspiration? – but of course as they are lagging the information is too late for course correction, even if broken down by “performance vs budget” on a year to date basis.

Leading KPIs are definitely part of the solution to securing a balance of KPIs – “number of Asia Pacific new accounts opened per month” is a good example KPI of how an organisation might be progressing against its strategy.

Nevertheless there is often opportunity for improving KPIs to improve execution of strategy.

For example do you measure if decisions made are adhering to the strategy? Is everyone executing the strategy of growing direct business in Asia Pacific? If there are short term cost or revenue pressures do decisions change? What KPIs do you have to measure this? – and perhaps some measures may need to be qualitative rather than quantitative.

And going back to basics do you measure if the data that caused you to create the strategy you are executing is still valid. If your aspiration was to grow revenues in Asia Pacific because prices were higher than in other regions, would you know and what what you do if prices were now higher in Latin America? Do you have the management processes in place to measure and act on this? Have you ever thought about trigger points?

Does any of this resonate with your organisation? If so let’s book a Teams or Zoom call and talk about possible solutions to help you secure a winning strategy that gets executed. If you would like to read more on these ideas please subscribe to the Arkaro mailing list – and we would recommend your buying a copy of Pete Compo’s “Emergent Approach to Strategy” – a key inspiration for this article.

Mark Blackwell - independent consultant Arkaro

Mark Blackwell

Mark Blackwell founded Arkaro in 2016 following a career in both large and small organisations, covering a wide range of industries across agriculture, food and chemicals. As Global Sales and Marketing Director Mark led the growth of the animal health company Antec International to its acquisition by DuPont. Leadership positions in DuPont developed expertise in Business Development, Innovation, Product Line Management, Integrated Business Planning, Business Productivity and Six Sigma Black Belt Project Management. At DuPont Mark worked with Pete Compo as the ideas forming the Emergent Approach to Strategy™ were developed.  In recent years Mark has been involved in the preparation of the Emergent Approach to Strategy and is the first affiliated partner to deliver to help product line and business teams design and implement adaptive strategies.

Mark is based in the Geneva, Switzerland area