In Richard Rumelt’s classic “Good Strategy, Bad Strategy”, there is a story that takes place in 1890. Andrew Carnegie, one of the richest Americans of that time, meets the then unknown, 34-year-old Frederick Taylor, a now well-known name in the management consulting world. Carnegie challenges Taylor to give him some useful advice on the spot. If he succeeds, he will receive 10,000 US dollars. Taylor thinks for a moment and then comes up with the following advice: “Make a list of your 10 best things you could do. Then rank them in order of importance. And finally, pick the best idea and focus solely on realizing that idea.” A week later, Taylor receives the money.
This story illustrates a few things, besides perhaps the fact that some people simply have too much money ☺. First of all, it is worth a lot to think things through carefully, set priorities and make clear choices. Making a list is a simple but effective tool to go through that process. And the real gold lies in going through that process and not stopping there. Thinking things through properly means in this case: thinking about a) what you really want to achieve, b) how you want to achieve that, c) formulating concrete steps.
Strategic, collaborative and corrective
This may sound only organizational, but this type of planning and execution is much more than that Formulating a problem or challenge and mapping out the path to it makes it strategic. From thinking and talking to doing. From thinking and dreaming to doing (and dreaming is still very much allowed)! And in doing so, communicating in a structured way, measuring progress, thinking together, doing, making mistakes, learning, re-prioritizing, doing better.
Thirdly, it contains the seed of better collaboration and communication. And fourthly: it helps organizations, teams and people to deal more effectively with what we all have: cognitive limits and biases (deviations from more ‘optimal’ or logical behavior).
Since Carnegie’s time, many great tools have been introduced to help organizations, teams and individuals select and formulate their goals, make them measurable, and communicate effectively about progress in order to realize those goals. We are talking about strategic planning and execution. OKR and OGSM have become my favorites, and both have their share of renowned names that have grown big with the help of those protocols. For example, Intel, Amazon and Google (OKR). And Procter & Gamble, Honda and Coca-Cola (OGSM). En Procter & Gamble, Honda en Coca-Cola (OGSM). Again, the tools are also useful at team level and even at individual level.
Collaboration is an essential element, because a good OKR or OGSM process requires transparency within the entire organization or within the entire team. What are everyone’s goals? Who is responsible for what? Who can use some help with what? If this culture is well embedded, it entails a high degree of mutual trust, high involvement, ownership, high enthusiasm, a good atmosphere, high energy, ambition, speed, a culture of high joint performance and a good chance of better results. Along the way, for sure adjustments will need to be made based on logic (including and perhaps especially ‘common sense’) and empiricism/data.
The fourth advantage of strategic planning and execution is that it helps with the cognitive limits that we all have and biases (‘deviations from optimal behavior’) that we all have. With a fancy word: corrective. For now, just one example of that: precommitment. It means: making a choice in the present that limits your choices in the future. Sounds like a bad idea? Not if you consider that in many situations you are inclined to let your current preferences weigh more heavily than your future interests, even if that is not so smart. OKR and OGSM help you to make your agreements with your team members explicit. For example, that you will perform activity X at time Y for the benefit of strategy Z. That increases the chance that you will actually do it. More in a next blog, which will be entirely devoted to behavioral change and biases.
Successful introduction and rollout
The successful introduction of OKR and OGSM requires expertise, experience and patience and gradualness on the part of the organization. Time, energy, thinking and power to get things done, are needed for explanation, for support, for enthusiasm, for success.
If you need my help for advice, coaching, training or non-technical help (technical help from my colleagues) with the implementation of strategic planning and execution for your organization or team, you know how to contact me. With a few top colleagues, I advise almost any type of leadership and management team. And we can bring in optional specialized software where desirable.