The challenge to remain competitive
today is forcing businesses and organizations, including those in the nonprofit
sector, to reconsider the basic concept of strategy.
For example, while the “traditional view of strategy focuses on
the degree of fit between existing resources and current opportunities, the
application of the concept of strategic intent creates an extreme misfit
between resources and ambitions” (Hamel and Prahalad 1989). Put another way, the concept of strategic
intent implies that the important question is not, "How will next year be
different from this year?" but, "What must we do differently next
year to get closer to our strategic intent?" (Hamel and Prahalad).
While competitive pressures may be the catalyst to a strategic
makeover, incorporating strategic intent or other emerging strategic approaches
necessitates a change in one’s organizational culture. Bringing about
organizational change, however, is one of leadership’s most difficult challenges,
not surprisingly, as most often changes are disruptive to current social
relationships, damaging to current levels of power and status, and threatening
to current reward structures (Cameron 1991).
So, what steps can
management take to successfully lead their organization through a major change
in strategic approach?
Of foremost importance is Communication.
At the outset, top management needs to “create a sense of urgency, or quasi crisis, by amplifying weak signals in the
environment that point up the need to improve” (Hamel
and Prahalad). Moreover, the vision and criterion that will be used to chart progress must be
easily understood by every member of the organization so that the staff can be
working toward a consistent overall goal.
Visions include the universalistic
values and principles that will guide behavior in the future; they evoke deeper
meaning than mission statements or goals (Cameron). Under strategic intent, the
vision is focused on the essence of winning - Komatsu set
out to “encircle Caterpillar;” Canon sought to “beat Xerox;” Honda strove to
become a second Ford—an automotive pioneer (Hamel and Prahalad).
The critical importance of adequate and consistent communication
in executing organizational change is underscored in a new study, “Where Change
Management Fails” underscores (Lippman 2016).
Survey respondents (including 300 managers at U.S. companies with 20 or
more employees) were asked: “What is most important when leading your company
or team through a major change?” 65%
answered “communicating clearly and frequently” – far outdistancing “managing
expectations” at 16% and “outlining goals” at 9% (Lippman).
Engaging the
organization for change further requires top management to (Hamel and
Prahalad):
· Develop a competitor focus at every level through
widespread use of competitive intelligence. Every employee should be able to benchmark his or her
efforts against best-in-class competitors so that the challenge becomes
personal.
· Provide employees with training to improve their
capacity to adapt and to help ensure that they have the skills they need to
work effectively (i.e.,
statistical tools, problem-solving, value engineering, and team-building).
· Give the organization time to digest one challenge
before launching another. When competing
initiatives overload the organization, middle managers often try to protect
their people from the whipsaw of shifting priorities.
· Establish clear milestones and review mechanisms to track progress and ensure that internal
recognition and rewards reinforce desired behavior. The goal is to make the
challenge inescapable for everyone in the company.
Changing an organization’s culture is a large under-taking,
however, these steps can help to bring about a successful transition at a time
when competitive pressures are forcing growing numbers of businesses and
organizations to consider the need for a strategic makeover.
References
Cameron, Kim. Transformational Leadership.
Chapter 10 in Developing Management Skills. New York: Harper-Collins, 1991.
Hamel, G. and Prahalad, C.K. Strategic
Intent. Harvard Business Review, May-June 1989.
Lippman, Victor. 2016. “Why Does
Organizational Change Usually Fail? New
Study Provides Simple Answer.” Forbes, February 8.
