Christopher G. Worley, Ph.D. Robert
Barnett, Ph.D.,
L.P.
David E. Hitchin
Pepperdine
University MDA
Leadership Consulting
Group
Pepperdine University
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In 1995, Carlsbad, Calif., a coastal city of 83,000 located a half-hour north of San Diego, was emerging from the worst recession in its history. In response to a request from the Carlsbad city council to operate the city’s government in a more business-like manner, the Carlsbad city manager led his staff through a comprehensive strategic planning process. The process produced a new city mission and vision, a set of organizational values to guide decision-making, a new information system, and a revised performance appraisal process.
Through this initiative, however, the Carlsbad city manager recognized that the organizational structure for the city’s approximately 600 employees was misaligned. As a result, he convened a management task force which reorganized the city’s staff into five major service areas (MSAs): administrative services, community development, community services, public safety and public works.
The largest of the new MSAs, Public Works, had previously
consisted of independent departments responsible for engineering,
parks, streets, facilities and fleet maintenance, as well as a
separate water district owned by the city. The new public
works director was excited about designing his new MSA according to
the vision and values created by the city during its strategic
planning process. He organized a task force of 40 volunteers
from all levels of the public works department to develop the new
MSA management and organization structure.
The task force’s efforts ended
almost before they began. While everyone in public works was
aware of the city-wide reorganization and the new MSA initiative,
no one truly understood the reason for the change. Most
importantly, the public works task force did not have a clear sense
of its purpose, goals or timeline. Rather than accepting the
new MSA, many public works employees complained that the whole
process was a
“sham,”
since management already had the
“answer.”
This short case illustrates a common set of issues in strategic change and the complex challenges managers often face. Most organizational leaders enter strategic change processes with good intentions, although many underestimate the difficulties and challenges that arise. A primary cause of these difficulties is the tendency among leaders to knowingly or unknowingly separate the content-driven issues of strategy from the process-driven issues of organizational development (Worley, Hitchin, and Ross, 1996).
Our research into strategic change has found three common
errors. First, in creating a strategic plan for change, some
leaders overestimate the appeal of the change and underestimate its
potential negative impact. When leaders or staff groups own
and direct the strategic analysis, the organization members who
must implement the plan become alienated from the change
process. We term this issue,
“planner’s
enthusiasm.” Second, by
separating strategy and organizational development, leaders may
create overly grand new business and organization strategies.
They get caught up in the implications of the analysis phase and
try to solve all of the organization’s
problems with one comprehensive initiative. We call this the
“blue-sky
strategy” problem. Finally,
leaders may overestimate the ability of their organization to
implement the strategy. This issue is labeled the
“cut-and-paste
implementation” problem.
The table below describes these three issues, their causes
and symptoms, and our proposed remedies when these problems
occur. In cases where strategy implementation has stalled
because of planner’s enthusiasm,
blue-sky strategies or cut-and-paste assumptions, we have found
that three types of activities can re-energize the process:
Unburn the Bridge, Get to Bedrock, and Put
Legs on the Dream.
Unburning the bridge addresses the negative consequences of planner’s enthusiasm and develops or restores ownership of the process by involving those who are directly responsible for implementing the change strategy. Getting to bedrock addresses the blue-sky strategy problem by getting the organization to make clear and hard choices about goals, strategies, and resources. Finally, putting legs on the dream addresses the cut-and-paste implementation assumption by providing concrete ways to achieve the goals and strategies developed in the bedrock stage.
Issues, Symptoms, and Remedies of Stalled Strategy Implementation
| ISSUES | CAUSES & SYMPTOMS | REMEDY |
| Planner’s
Enthusiasm: Failure to understand the negative impacts of the planning process on people |
|
Unburn the Bridge:
|
| Blue-Sky Strategies: Strategies and initiatives are “too grand” |
|
Get to Bedrock:
|
| Cut & Paste Implementation: Overly ambitious assumptions about the organization’s change capability |
|
Put Legs on the Dream:
|
Unburn the Bridge
The first step to revitalizing a change strategy is to
understand and appreciate the negative side effects of a typical
strategic planning process (Mintzberg, 1994).
Causes and Symptoms of Planner’s Enthusiasm. Planner’s enthusiasm happens when strategic planning processes occur at a different level in the organization than where implementation will take place. Implementation is stalled because the search for the perfect strategy is pursued at the expense of change execution. The most common example is when a CEO and his/her direct reports hire a consulting firm to develop and recommend a business strategy that will have to be implemented by division managers or other middle managers – without getting their input.
The negative effect of planner’s enthusiasm was evident in the Carlsbad case. A senior-level task force created the new city-wide structure, but implementation required lower-level public works employees to make it happen. The idea of an integrated public works organization was someone else’s wishful thinking.
Planner’s Enthusiasm Remedies. Unburning the bridge means taking a step back to involve the people who are directly affected by the change strategy. It involves regaining the implementers’ confidence in the process of change, reexamining the data used to develop the change strategy, and recapturing peoples’ creative input. Unburning the bridge creates ownership of the process by directly involving the people who will be responsible for implementing the change strategy.
Get to Bedrock
Organizations beset by blue-sky strategy problems must bring
their overly optimistic and aggressive strategies back to earth and
“get to
bedrock.” Blue-sky strategic
thinking occurs when important choices regarding goals and
strategies are glossed over in the name of lofty-sounding
objectives (e.g., reduce speed and cycle time, etc).
Causes and Symptoms of Blue-Sky Strategies. Blue-sky strategies lack clear goals, clear strategic choices, and adequate resources to support implementation; they clutter the organization’s core competencies. Frequently, blue-sky goals developed during strategy formulation fail simple tests of adequacy. Hofer and Schendel (1978) suggested that clear goals establish 1) the attribute sought (e.g., profits, revenues, costs), 2) an index for measuring progress (e.g., dollars, cost/unit), 3) a target or hurdle to be achieved, and 4) a deadline or time-frame for accomplishment. Real or implied goals in blue-sky strategies usually fail to meet these criteria.
Similarly, blue-sky strategies fail to provide clear strategic choices. For example, aggressive growth strategies are outlined next to above-industry-average profitability objectives. Employees are asked to meet both quality and ROA objectives even though achieving the former often must occur at the expense of the latter, at least in the short run.
In addition, blue-sky strategies are announced with incomplete or inadequate estimates of the resources required to make them happen. Commitment to the strategy wanes as employees and middle managers realize that that the newly announced initiative has little chance of success. In trying to accomplish everything, blue sky strategies ignore the organization’s core competencies. Instead of focusing attention and resources on what the organization does well, the blue-sky strategy promises to do everything perfectly.
Blue-Sky Strategy Remedies. One of the first and most important ways to fix a blue-sky strategy is to give it urgency and context by connecting it to current business issues. The blue-sky plan’s greatest weakness is its generic nature. It tries to please all stakeholders all of the time and, if implemented, would please no one at all. Getting to bedrock means grounding the strategy in current issues so that it becomes relevant and real to the people who will be implementing it.
The second way to get to bedrock is to set realistic but challenging goals. The blue-sky strategy drains energy from implementation because it either doesn’t set goals or sets goals which are unattainable. Studies on goal-setting (Locke and Latham, 1990) make it clear that goals set too high or too low are not motivating, but goals that are achievable with effort generate commitment. Getting to bedrock means ensuring that the goals are properly motivating.
Athena Pharmaceuticals, a global developer, manufacturer and
distributor of branded pharmaceuticals, was formed through the
merger of two large European pharmaceutical companies.
Shortly after the merger’s approval,
Athena’s top management asked
lower-level managers to submit a
“strategic
plan” for the new
organization.
To meet Athena’s deadline for the
strategic plan, it was conceived and written by a small group of
well-intentioned, but isolated planners. The plan called for
Athena to shift from being a
“product-oriented”
to a
“customer-driven”
organization, and to switch from a
“functional to a process
focus.” While these lofty goals
sounded good in principle – a hallmark
of blue-sky strategy – for all
practical purposes they were impossible to achieve.
Athena “got to bedrock” soon after when its executive team recognized the need to establish more realistic goals. They commissioned several “strategic action teams” who analyzed and recommended plans for: 1) documenting and strengthening the organization’s core processes; 2) aggressively developing the company’s human resources; and 3) improving interaction with key customers. The obvious emphasis in the action teams’ work was unmistakably on practical, doable, and implementable strategic action.
The true test of getting to bedrock is asking whether the organization has made difficult choices regarding goals and resources. Getting to bedrock gets people to face the reality of what CAN be done, not what COULD be done. It represents a hard-nosed look at the resources and capabilities that can result in competitive advantage.
Put Legs on the Dream
The third challenge in revitalizing stalled change efforts involves
addressing the assumption that a blue-sky strategy can be
implemented immediately or easily. Enter the
“cut and
paste” mindset. Too often,
managers assume that current organization practices can be dropped
(cut) and new systems and processes picked up and executed
immediately and flawlessly (pasted). The remedy to this
thinking is “putting legs on the
dream.”
Causes and Symptoms of Cut and Paste Implementation. When implementation stalls due to cut-and-paste assumptions, it’s because senior leaders believe that employee behavior can change immediately, that the process will cost nothing, and that there will be no loss in performance. As a result, the strategy is announced with no clear first steps, unrealistic expectations for implementation, and inadequate resources for funding. Clear next steps are a key element in the change equation made popular by Beckhard and Harris (1987). Without these steps, members of the organization are unable to become enthused about the new strategy, become frustrated by the unrealistic expectations thrust upon them, and looks for ways to avoid or sabotage the new initiative.
The Carlsbad case clearly demonstrates the importance of setting clear and attainable steps for implementation. At the beginning of the effort, the public works director wanted to have the new organizational structure designed and implemented in one month. To conduct their work, the MSA task force had to first create and agree on an ideal organizational structure that would work for the next 10 years. The task force could then start to see how the city and the public works department could change and grow over time. They were able to establish action steps that were concrete, achievable, and that linked sets of shorter term plans together to eventually reach their 10-year goal. Without more realistic and shorter term “transition” plans, the redesign effort may have never gotten off the drawing board.
Cut and Paste Assumption Remedies. “Putting legs on the dream” creates a clear strategy based on reality and ownership, in which the organization can design the system needed to support the strategy and calibrate, prioritize, and sequence the activities required to make it happen.
To “put legs on the dream,” change champions must first convene affected employees to design the organization required to support the strategy. In traditional planning processes, much of the discussion is on strategy and, to a lesser degree, structure and technology, resulting in an overemphasis on the “vertical” issues of strategy and structure. The challenge is to give adequate attention to the “horizontal” supporting mechanisms of performance management, reward systems, training, and information systems (Lawler, 1996). These horizontal systems play an extremely important role in integrating the new strategic orientation and building ownership and accountability into the organization.
Once a workable system is in place, managers can then calibrate, prioritize and sequence the strategic, tactical, and organizational initiatives required to implement the strategy.. Calibrating determines each activity’s scope, direct and indirect costs (e.g., executive time available), and their impact on other systems. Prioritizing sorts tasks by importance vs. ease of implementation. Important, easy-to-implement tasks, also known as “early wins,” can help to generate or sustain momentum in a change effort. Finally, sequencing recognizes that some tasks need to be accomplished before others and that other tasks are constrained from occurring because of existing contracts or expectations.
In Summary
Planner’s enthusiasm, blue-sky
strategies, and cut-and-paste implementation assumptions result
from divorcing content issues in formulating strategy from
process-oriented issues in organization development and change.
Planner’s enthusiasm mistakes are driven by senior managers and consultants who are more concerned with what the strategy should be and the purity of its formulation than with how it will be implemented. The result is a lack of commitment from the people who are required to make the strategy happen.
Blue-sky strategies result from a set of forces that urge managers to accept and promote goals that can’t be achieved by any strategy. With inadequate attention to the real consequences of strategy formulation, these forces go unchecked. The result is a strategy that has no chance of succeeding.
Finally, cut-and-paste implementation assumptions do not reflect the hard realities of what it takes to change organizations, including time, effort, and commitment. The result is a plan that falls apart in practice.
In response, organizational leaders must “unburn the bridge” destroyed by planner’s enthusiasm, “get to bedrock” by grounding the strategy in reality and making hard choices that result in clarity of purpose, and “put legs on the dream” by replacing wishful thinking with concrete action plans that move the organization toward its goals.
If You Want to Read More
Beckhard, R. and R. Harris. (1987). Organization
Transitions. Reading, MA: Addison-Wesley.
Hofer, C. and D. Schendel. (1978). Strategy Formulation. St.Paul, MN: West Publishing.
Lawler, E. (1996). From the Ground Up. San Francisco:
Jossey-Bass.
Locke, E. and G. Latham. (1990). A Theory of Goal Setting and
Task Performance. Englewood Cliffs, NJ: Prentice-Hall.
Mintzberg, H. (1994). The Rise and Fall of Strategic Planning. Boston: Harvard Business School Press.
Worley, C., D. Hitchin, and W. Ross. (1996). Integrated Strategic Change. Reading, MA: Addison-Wesley.
This article is a synopsis of a paper presented at the 40th Western
Academy of Management Conference. For a copy of the full
paper, please contact MDA Leadership Consulting Group, Inc.