“If your actions inspire others to dream more, learn more, do more and become more, you are a leader.” John Quincy Adams

Corporate transformation begins with a dream. It provides the context for every other change concept or improvement initiative that will follow. It is a leader’s responsibility to dream the dream and re-imagine what the organization is about and how it will conduct its affairs and execute its mission well into the future. This responsibility holds true whether envisioning a new direction for a global concern or redefining the work environment at the Division-level.

The dream, or vision, must become the stuff of rallying cries and express the common goal that the leader and team will share. Once the vision is defined, the leader must articulate it and spread the message across the enterprise. This must be done in a way so that every staff member can understand and buy-in to the dream.

“I’m not upset that you lied to me, I’m upset that from now on I can’t believe you” Friedrich Nietzsche

January 28, 1986 was that fateful day when the Space Shuttle Challenger broke apart 73 seconds into its flight, leading to the deaths of its seven crew members. The tragedy left a nasty scar in the United States space program. Most of you have heard of this incident, but what we may be less familiar with is the conclusions drawn by the Rogers Commission (appointed by President Reagan to investigate the catastrophe):

“NASA’s organizational culture and decision making process were key contributing factors of the accident. Technicians, who were aware of problems, did not feel it was safe to bring it up due to low trust levels.”

People can’t do their best if they fear reprisals for raising issues that may be viewed as unpopular by their management or colleagues. As managers we need to establish work settings where personnel feel safe to do their best.

“Determine that the thing can and shall be done and then we shall find the way.” Abraham Lincoln

Strategic Planning is one of those things that every company claims to do, but, few do it well. Most mistake annual budgeting for strategic planning. Because of this, many organizations are ill-prepared for the competitive demands that lie ahead and they lack the discipline and rigor needed to identify, organize and execute the appropriate work in any sustainable way – leaving them to flounder in the New World economy that awaits us.

“Never doubt that a small, group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has.” Margaret Meade

See It In Action: Zappos: The Poster Child of Employee Engagement

Zappos, the online shoe and clothing retailer based out of Henderson, Nevada is the poster child for employee engagement. Its 1500 employees support an operation that generates an astounding $7 million per day in sales. Its unique culture serves to engage a committed workforce and, ultimately, contributes to the firm’s incredible success.

The executive team wants to ensure that every new hire will immediately contribute to the firm’s over-the-top customer service ethos. So, it has instituted a highly extensive interview process to safeguard fit. Only 1 in 100 applicants get awarded a job at Zappos. If you want to work there, your passion must shine through when interviewing.

Once successfully through the gauntlet, the message becomes very clear, “Buy in to what we are doing here or we will pay you to leave.” The company has a policy that will pay a new hire $2,000 to resign if they find that they can’t quickly assimilate into the company’s vibrant culture. It is an understatement to say that engagement is important at Zappos.

The firm’s annually published Culture Book is a great example of the importance that has been placed on employee buy-in to the corporate philosophy. It is exclusively developed and produced by staff members. The book contains a variety of contributions from personnel exemplifying what it means to work at the online retailer. Its photos and short stories all serve to reinforce Zappos cultural norms and values.

Recently, the Company has even created a spin-off venture called Zappos Insight, a management consulting and training business that provides employee engagement and service delivery offerings to organizations interested in soliciting ideas from the way Zappos built its business. Attendance at one of its regularly scheduled 3 day seminars runs $6000.00 per person. But, it may be worth the price of admission to gain the staff engagement needed to reinvent an organization.

Nonetheless, Zappos is a new economy enterprise that has figured out a way to engross and inspire staff. Its success, even in the face of a downtrodden economy, indicates that the company is on to something that every executive should become aware of and better understand.

Source: “Zappos hits the jackpot with employee engagement in Las Vegas,” by Marc Wright, http://www.simply-communicate.com/case-studies, November 29, 2010.

“Vision without execution is hallucination.” Thomas Edison

It just makes sense to arrange of all of the work necessary to realize an organization’s strategic vision into a project portfolio. A project portfolio provides a context for simplifying the complex. It has the capacity to break larger endeavors into smaller ones that are more easily managed. It provides a framework that enables executive engagement in project execution and delivers a platform for informed decision-making – ensuring proper resource allocation and improved management and monitoring of the internal investments needed to achieve long-term business success.

When fortified by automated tools and a skilled and committed administration function, project portfolio management is the lynchpin that integrates strategic planning with project implementation – vitally securing vision to action.

Given today’s competitive realities, can an organization really afford not manage its work through a portfolio of projects?

“He that will not apply new remedies must expect new evils; for time is the greatest innovator.” Francis Bacon

Improvement for the sake of doing things differently is not why we, as executives, must establish ongoing business renovation programs within our organizations. Rather, we should renovate in order to strategically differentiate our enterprises from the competition. This distinction is an important one to make because it serves to inform the decisions about which types of changes and improvements we should pursue.

To be the organization of choice, for example, suggests that we offer the right products, at the right price, through the right distribution channels while providing the right customer experience. It does not automatically imply that we offer the lowest price or the best product in order to be “of choice”. Quite the opposite, in fact, it proposes that we possess the optimum combination of elements to make our enterprise stand out within the markets in which we compete.

“One of the things that I’ve used on the Google is to pull up maps.” George W. Bush

Here is a list of technological implications that came from a few of my recent clients’ strategic planning efforts. It is indicative of the ways in which technology requirements can be buried within the details of a strategic plan:

• Claims Adjudication Process Redesign Project: A major P&C insurer exposed the need for developing a mobile computing application as a means to support the newly reengineered business process;
• Service Delivery Project: A country-wide retailer identified the requirement to build an online customer support portal;
• Sales Improvement Project: A global manufacturer determined the provision of a Web-based sales support product as a condition of project completion;
• Customer Intimacy Project: A regional financial services firm called for the acquisition of a cloud-based Customer Relationship Management (CRM) package as prerequisite to the completion of its “Customer First” initiative;
• Product Distribution Project: A niche software company recognized that the best solution for it to remain competitive involved retooling its packaged software products into a Software-as-a- Service (SaaS) solution.

It is important to recognize all of the technology implications of our strategies because it is the only way that we can be sure that nothing falls through the cracks and negatively impacts our enterprise’s long-term success.

Things do not change; we change. Henry David Thoreau

See It In Action: Wal-Mart Gets What It Pays For!

Wal-Mart is the epitome of a discount retailer. Everything that it does is on the cheap. Notorious for nickel and diming suppliers, while pinching pennies with their employee compensation, Wal-Mart is beginning to feel the impact of cutting to close to the bone.

Last year, the company grew its store count by 13 percent, while downsizing its staff by 20,000. To say that morale is suffering at the discount retailer is quite an understatement. Customer service is atrocious, while store shelves remain near empty as product sits on pallets waiting for stocking – prompting Wal-Mart to be placed last among department and discount stores in the American Customer Satisfaction Index.

It is no wonder that rivals like Costco are growing their sales and their membership (i.e., increasing its membership revenue by $69 million in first quarter 2013, compared to the same quarter last year). Clearly, customers are leaving Wal-Mart in droves, seeking a better experience at Costco, where the shelves are stocked, lines are shorter and shopper assistance is readily available.

Are poor compensation and no incentive planning a trend that is contributing to the problem at Wal-Mart? As recent as last year, MIT management professor Zeynep Ton reasoned in a Harvard Business Review piece that points to that probability:

“Costco and Trader Joe’s pay their workers far more than many of their competitors, offer their employees opportunities for promotion and enjoy markedly lower worker turnover and far higher sales per employee than their low-road counterparts. Sales per employee at Costco are nearly double that at Sam’s Club.”

Undeniably, personnel inform the customer experience in a retail store and Wal-Mart’s customers appear not to be very happy. So, maybe the discount retailer should follow Costco’s lead and begin to rethink its employee compensation and incentive models in order to right the ship, while there is still a ship to right.

Source: “Walmart Pays Workers Poorly and Sinks While Costco Pays Workers Well and Sails – Proof That You Get What You Pay For,” by Rick Ungar, www.forbes.com, April 17, 2013.

“The single biggest problem in communication is the illusion that it has taken place.” George Bernard Shaw

As referenced throughout the book, today’s business environment requires that organizations learn to function at a very high level, while continuously changing and growing. The idea is to be as nimble, quick, interconnected, and customer-centric as possible, and, still consistently pump out customizable products and services of unmatched quality and appeal. Sure, it is a tall order. Then again, if our enterprises can’t deliver what the marketplace expects, someone else will.

Open and honest communications is a vital ingredient for success within the modern day work setting described above. Staff members must be able to readily access all relevant information and know-how, wherever it exists, in the format desired, and have confidence in its quality in order to use it. Hence, a renewal of communications practices is not only in order, but, is essential to remaining competitive.

“Imagination is everything. It is the preview of life’s coming attractions.” Albert Einstein

It is important to note the distinction between an organizational design and its associated operating model. The organizational design defines how workers are grouped together, structured and managed. The operating model defines how the organizational design is traversed in order to perform the work of the enterprise. In other words, the operating model outlines how the organization operates.

With that, organizational design changes can call for new kinds of operating models. Similarly, societal changes can impact an organization’s operating model, too. For example, recent economic downturns coupled with the emergence of the Generation Y worker, as discussed in Chapter 4, have established a more transient workforce than existed in the most recent past. So, operating models must shift to accommodate this phenomenon.

Part-time and temporary work programs are making freelance workers more of the norm than ever before. Because Millennials are willing to trade the apparent security of traditional work arrangements for the independence that comes with free agency, executive leaders should anticipate the continuation and growth of the free agent workforce and, therefore, need to head towards the creation of freelancer-rich operating models.