Page 45 - Council Journal Winter 2019

Happy statue
Stuck in a shambles
In situations like this, organisations are like organisms where all elements are connected and working together, therefore changes in one dimension— say, roles and accountabilities—will often require changes to another, like incentives. Senior leaders need patience to work on the relevant combination of levers that will improve performance.
So how can companies create a performance-oriented culture without losing inspiration? To start, it’s essential for senior leaders to articulate a compelling case for change, rooted in the organisation’s underlying mission and history.
On the other hand, if the senior team does not consistently understand or align around the basic strategy, that’s where to focus first.
At the same time, they should assess the operating model, particularly whether it needs an overhaul to perform well in the future given how the relevant markets are evolving. They can also consider zero-based redesign, mentioned earlier, as a way to realign the investment posture with the main sources of growth. And regardless of the specific changes required, senior leaders will want to incorporate employees’ participation when deciding on and planning next steps.
A leading financial services company has decided to redefine its portfolio and reassess whether years of progressive centralisation had really made operations more effective, in addition to bringing cost benefits.
Orchestrating an organisational turnaround can feel overwhelming, with so many issues to sift through and possible levers to pull. The organisational Navigator approach provides a clear view on the urgent priorities, as well as which areas merit the greatest investment in order to generate superior performance.
If the root cause lies in bloated teams or processes, which prompt ineffective across-the-board cuts and diminished capabilities, the organisationshould start with zero- based redesign and a complexity audit.
The patterns that emerge from our analysis provide general direction. However, an individual organisationshould undertake its own diagnosis to understand its situation in detail—whether the fundamental challenge involves orientation, execution or both, and which areas to invest in to get back on track.
Executives found many troubling issues, such as persistent gaps in efficiency and responsiveness to customers, after many activities moved away from the front line.
The recovery plan was thoughtfully sequenced to address foundational issues first, such as realigning line-of- business boundaries and closing capability gaps.
A version of this article first appeared on the website of organisational consultancy, Bain (www.bain.com). Co-Authors are Dan Schwartz, Ludovica Mottura and Julie Coffman.
Council Journal 45
Only then could the company pursue other opportunities, like
FEATURE Poor Organisational Performance
Inspiration is never enough, even at mission-driven companies that invest a lot in their people. For instance, an organisation may choose consensus over performance, neglecting the power of individual accountability. Even if employees are highly engaged, they may quietly worry that their organisationhas not kept pace with marketplace changes or does not confront slips in productivity.
Now we come to the toughest nuts to crack. For across-the-board underperformers, the biggest question is where to begin, because everything hurts: Costs remain too high, capabilities lag, the executive team bickers, important decisions languish, employees disengage.
technology teams embracing Agile methods, or optimising the company’s footprint.
Still other companies avoid the tough decisions that efficient execution demands. Their investment posture typically focuses on past spending, and favors adding rather than removing roles. It would be more fruitful for them to build capabilities that would improve performance.
Understanding what led to the decline is essential to figuring out how to reverse it.
Setting the right course