What are the five principles of a strategic performance management organization for national enterprises
Principle 1: translating strategies into actionable actions
Working with the senior management team on strategies to define strategic objectives and to translate them into a simple and understandable strategic map, the centrepiece of which is a description of how enterprises create value and a standardized checklist of strategic elements for management strategies. A well-designed strategic map that clarifies the causal logic between the strategic objectives of the organizational or business units and the functional units is a strategic map that visualizes the enterprise's strategic vision and presents the results objectives of concern to the enterprise and the path to achieving them。
In designing the strategic performance management consulting project, when refining the key performance indicators, we must focus on their relevance to the strategy, clarify the causal logic between the strategic indicators and identify the core processes that underpin these key performance indicators, and then find a correlation between the key process performance indicators and the strategic indicators through the value tree model, so that we can truly translate the strategy into actionable behaviour。
Principle 2: synergy around strategies
Synergy is the overarching objective of the organization. The organization consists of a large number of institutions, business modules and professional functions, each with its own strategy. In order for overall organizational performance to outpace the sum of performance generated by the various parts of the organization, the strategy for each module must be interlinked and synergistic。
Traditional organizations are designed around functions such as finance, manufacturing, marketing, marketing, customer services and procurement. Each function has its own language, knowledge and culture. Barriers between functional units are a major obstacle to the implementation of the strategy, and most organizations have significant difficulties in communication and coordination between cross-sectoral functions。
Strategic and central organizations can break these barriers. Management can change the original formal reporting structure to convey consistent messages among the decentralized modules within the organization according to strategic themes and priorities. The organization need not change its original structure. Business modules and shared services are closely linked to corporate strategies through common strategic themes and objectives。
In designing the strategic performance management advisory project, we have always focused on vertical and horizontal synergy in the organization. Vertical synergy refers mainly to vertical consistency of indicators at the corporate level, indicators at the sectoral level and indicators at the job level, emphasizing vertical decomposition of indicators, i. E. Communication and synergy between upper and lower levels; horizontal synergy mainly refers to horizontal decomposition of cross-sectoral objectives through processes, emphasizing horizontal decomposition of indicators, i. E. Communication and synergy between parallel sectors or jobs. Only in this way will it be possible to ensure that corporate performance is greater than the sum of the performance of the various parts of the organization and achieve organizational synergy。
Principle 3: making strategy a daily task for everyone
In practice, no company can successfully implement the new strategy by relying solely on the chief executive officer and the senior management team, the implementation of which requires the support of all staff and the active contribution of each staff member in the organization. How then can strategies be transferred from corporate decision-making to executive teams and to front-line grass-roots staff responsible for day-to-day operations and customer service?
A strategic central organization requires that all staff understand the strategy and work around it every day. This is not a top-down order, but rather a top-down communication process. Many companies have achieved an understanding strategy through seminars。
In designing strategic performance management consulting projects, we insist on linking individual staff performance closely to organizational performance, while linking individual performance results to individual career development, individual staff empowerment and incentives such as pay benefits, to a complete, sustainable and dynamic strategic management system. Only such an individual can help the organization achieve the objectives of the company by pursuing the goals of the individual, and the strategy must become the daily work of everyone。
Principle 4: making strategies a continuous process
For most organizations, processes are built around budgets and business plans, such as reducing costs and reducing delivery time. The monthly business management meeting was to review and analyse the gaps between current performance and plans and develop an action plan to address them. Research shows that 85 per cent of management teams spend less than one hour a month discussing strategies. There had never been time on the management agenda to discuss the strategy, and it was not surprising that its implementation had failed。
Strategic central organizations follow completely different approaches. The organization's senior management team must be involved in periodic strategic review meetings to discuss problems, gain an in-depth understanding of the root causes of existing problems, develop improvement plans and implement those responsible. The senior management team will find that their participation in the conference is also a process of mutual learning that can provide creative solutions to problems. After the meeting and before the next meeting, the management team could verify the feasibility of the assumptions and plans presented at the previous meeting. This will allow for practical data support for better management analysis and decision-making at the next meeting。
Principle 5: senior leadership for change
Many cases show that successful strategic performance management projects necessarily require the involvement of senior corporate leaders. The strategy requires a shift in each component of the organization and teamwork to coordinate these changes. The implementation of the strategy requires sustained attention and focus on organizational change action programmes and gaps in performance and objectives. Without the active involvement of the top of the company, change will not occur and strategies will not be implemented, and opportunities for breakthrough performance will disappear。
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