Evalesco

Background.

There are obvious reasons why a formalised strategic management process is required in corporate and / or complex organisations. Planning and reporting as main functions need to be co-ordinated so that it can present an overall picture of where the organisation is headed vs where it finds itself currently. These plans and reports should clearly spell out the desired direction handed down by management contrasted with actual realities of the regulatory, internal, and external strategic environments.

Examples of challenges in the process were:

• Strategies developed at the management level not finding their way into the day-to-day actions of employees.
• Cross-functional misalignment of strategies e.g. strategy to invest in Artificial Intelligence at a corporate level without addressing the impact of that in the HR Strategy or ICT Strategies.
• Targets as planned for, and results as reported cannot be integrated into an overall view of the organisation’s performance. This may happen for a variety of reason e.g. use of different strategic planning frameworks – one is using Balanced Scorecard methodology and another Results Based Management.

Scenario

In our case study, the organisation observed here presented us with the following scenario:

• Public sector reforms recently introduced a new strategic planning framework (the Results-Based Management Framework) for Strategic and Annual Performance Planning. The head of the organisation at the time believed that the Balanced Scorecard will be the “silver bullet” to solve all the problems that faced the organisation.
• A high-level strategic management process model existed, that created a context model for the process but lacked detail required to implement the new strategic planning framework.
• A view that was commonly shared between participants was that the new prescribed framework was only required by planning personnel for a “business” strategy and that the “operational” (“real”) strategy can continue as usual, the business strategy being the “external” plan and the operational strategy the “internal” plan. This indicated that a dual process was followed for planning, utilising already strained resources.
• As far as alignment was concerned, plans at divisional level were integrated “bottom-up” into the corporate plan. This resulted in a very long list of “divisional level” targets in the corporate plan as very few of these indicators could be aggregated into corporate targets.
• Consequently, the quarterly and annual reports were stressful to compile due to the many “performance indicators” from various sources that had to be reported on. Furthermore, these results were mostly long, sometimes outdated, detailed descriptions. Very few quantifiable, verifiable numeric based indicators existed.
• Monthly reports were loosely linked to the plans and here, as in the quarterly and annual reports, the results were mostly narrative based.

Interventions and achievements

Herewith are some of the actions we took to fulfil our tasking but also to ensure that the organisation received maximum benefit from it strategic management process as well as stayed compliant with public sector regulations.

• Our first step was to establish one strategic planning framework that was going to be used by the whole organisation. This took some time to get buy-in amongst senior role players as we had to fuse the current “process” with the Balanced Scorecard requirement and the need to comply with the prescribed framework.
• Next, we set out to streamline the set of indicators. We developed a set of 40 indicators (all with indicator definitions) by engaging with different functional specialists in the organisation. These were the “indicator design owners” whom we facilitated to develop indicators within their functional area of expertise – HR specialists designed the HR indicators etc. This was still a lot of indicators but, believe it or not, we started off with a list of more than 100.
• We established a performance indicator workgroup that formed a body of excellence for measurement expertise amongst functional groupings. In addition to the design of proper performance indicators, processes were also designed to establish reliable, auditable data stores.
• We advised on the design of templates of the plans, reports, and dashboards to support the framework and set of indicators and included these in a set of annual corporate planning and reporting guidelines. The corporate dashboard received a lot of praise since it provided an overall one-pager snapshot of the organisation's performance.
• Together with a few client champions we lifted the strategic management process maturity to a level where the need for an automated solution for planning and reporting was recognised.
• With their inputs we developed a set of prototypes and specifications that supported a structured process for planning and reporting which can be used by the ICT section for software development / acquisition.

All along we came to realise that the processes and the frameworks are the (necessary) scaffolding for the game changer: relevant, reliable, verifiable performance data.

Lessons learnt

There were far too many lessons to list here, but some of the most important ones learnt along the way were:

• The Strategic Management Process is a living process – it will probably never be cast in stone. As soon as you settle into a process or methodology a new “silver bullet” (or regulation) can come round to disrupt it again but this is a good thing in the long run as the relevance and usefulness of certain steps in the process or elements in the planning framework etc are then critically examined. With each iteration the maturity of the overall system improves.
• Executive support is required but buy-in at all levels impacted are also important. The whole effort can be sunk by a divisional or functional team undermining the process. As with most projects of this nature, best practice change management principles and practices are valuable to ensure buy-in at all levels.
• One standardised framework across the organisation is crucial – between business units and functional support divisions – as it aligns performance vertically and horizontally.
• Long narrative in corporate plans and reports may show dedication but doesn’t speak to executives who need it narrowed down to a “one-pager” view of the current state of the organisation. Templates and automated strategic management processes also assist in narrowing down the focus on the aspects that matter.
• In most cases the strategic management processes are not new for anyone working in a corporate environment. In addition, whether the Balanced Scorecard, Results Based Management or any other methodology is used, the detail steps are still the same. How it is grouped (the “hooks”) may depend on the methodology used, current organisational processes, macro- and micro-organisational processes, and other existing organisational policies already in place. Some processes will include strategy formulation, strategic planning, operational planning etc as part of a broader process just called “Planning”, others will feel more comfortable in splitting the Strategizing and Planning functions.
• What is important is that these “hooks” are generic processes that are executed on all levels within the organisation. What must then be considered is how and when and by whom the information is communicated / aligned between the organisational levels e.g. from corporate to the functional environments and from corporate to the business units for planning and back up the ladder for reporting.
• All along we came to realise that the processes and the frameworks are the (necessary) scaffolding for the game changer: relevant, reliable, verifiable performance data.