Harnessing the Power of Alignment
Aligning strategy and execution is an exercise that requires constant, company-wide dedication, but the benefits make the challenge worthwhile.
Most leaders understand that aligning strategy, culture and execution is critical to organizational success, but few appreciate it more than Lee Benson, the Founder and CEO of Execute to Win (ETW). Before forming ETW, he created sophisticated alignment software at Able Aerospace, which helped the business grow from three employees and no customers, to 500 employees with 2,000 customers in 60 countries.
Benson recently spoke with YPO members during about the importance of alignment, and how to use technology to achieve it.
Benson considers alignment one of the greatest challenges and opportunities organizations face. The challenges are daunting: objectively assessing leadership capability, connecting strategy outputs to execution plans, driving a high-performance culture, sustaining a standard management operating system and communicating in context with organizational goals.
The benefits are equally impressive. Benson shared research that shows that aligned organizations experience a threefold increase in employee engagement, a 21 percent increase in productivity and a 65 percent decrease in employee turnover (a cost he characterizes as “expensive to incredibly expensive,” depending on the position). Achieving these benefits means that alignment must be, in Benson’s words, “something you do before work, during work and after work — a continually refined, up-to-date, real-time process.”
Two alignment goals used at Able are likely applicable to all organizations. First is for all employees to be aligned, communicating and connected to strategy, as evidenced by outcome-based, actionable performance goals, supported by team scoreboards, which show wins and losses and advise team members where they stand and what is expected of them. The second is to have all employees aligned, communicating and connected to an intentional, high-performance culture driven by the organization’s mission, vision and principles.
Connecting strategy and execution
Benson’s strategy-to-execution chain begins with strategy, which creates the organization’s most important outcomes (MIOs — the value to be created for customers and internal stakeholders). These are supported by key performance indicators (KPIs), which measure performance against the MIOs. Beneath and aligning to the KPIs are two types of goals: top-level goals, which are objective, measurable goals that illustrate whether the organization is achieving the outcomes desired by customers and internal stakeholders, and foundational readiness goals, which are project-based and define new initiatives, capabilities and systems that, when completed, will improve the results of the top-level goals. Finally, there are actions designed to continually improve the results for each goal.
The role of technology
Benson’s approach at Able was to create software that kept track of all the teams’ and individuals’ activities, meetings, goals, measures, goal-centered conversations and communications, and status relative to culture and performance.
The resulting software enabled employees and leaders to see the data that indicates if a KPI or a goal is falling behind plan, a supporting plan is at risk, and gaps exist in expected results. The information is illustrated in graphical dashboards and various types of charts, making it quick and easy to identify key takeaways. The software provides qualitative information as well. The conversation and communication threads can help identify gaps in results, illuminate the underlying issue, communicate with appropriate teams and individuals in context, and take the right action.
Benson notes that the technology is just a tool to achieve the critical outcomes of enabling and strengthening alignment throughout the organization. What matters is to ensure “everyone is on the same page, is clear on accountabilities and understands the rationale behind the numbers. Communication takes place in real time and all efforts are focused on getting results.”
The information generated, captured and organized by the software has many uses. Among them: assess leaders’ ability to articulate how their team creates value, the practical things they do to achieve results, their ability to execute on strategy and scale, and their foundational readiness. Benson calls this process “eating and dreaming at the same time” — that is, the ability to get results today while also building capability, people, processes and systems to get even better results in the future. These assessments can be used to evaluate when employees need to be terminated, retrained or promoted.
In Benson’s view, the more clarity leaders are provided around where the organization needs them to build leadership capability, the faster they will develop. “You know you are doing this right when improving capability on intentional leadership elements causes measurable improvements in customer experience and profitability,” he says.