Strategy Realized – The Business Hierarchy of Needs® – Talent Optimization

These statistic from Boardview.io should cause pause to all senior leaders:

“80% of leaders feel their company is good at crafting strategy but only 44% at its implementation”

To make matters worse, they also report:

10% of organizations achieve at least two-thirds of their strategy objectives, with 36% achieving between 50%-67% and 54% achieving less than 50%

I have no reason to doubt these statistics based on what we see in our consulting work. The primary reasons for this are:

1. Lack of a sound strategic planning process
2. Little accountability
3. Minimal consideration of organizational needs
4. Poor implementation tools and follow-up

This blog article is about reason # 3:  Minimal consideration of organizational needs. 

Our strategic planning playbook relies on the change management model we call the Business Hierarchy of Needs®.  During the creation of a strategic plan, it is important to set the appropriate strategies and fully understand the current operating gaps (those things that aren’t currently working well) as well as the company’s strategic gaps (those things that stand in the way of the company’s ability to achieve its strategic objectives). Tactics then need to be defined to close the gaps.  Leadership teams are typically good at identifying software, products, and supply chain requirements to close both sets of gaps. The above set of statistics would indicate that leadership teams are missing something terribly important.

The Business Hierarchy of Needs® has three levels of activity that need to be considered as represented below. Each level must be done in succession in order to successfully create and implement strategy. In most instances where the implementation of strategy has failed, leadership teams have neglected Level 2, the bridge to successful strategic execution. The elements of Level 2 are:

1. Cascading objectives
2. Learning Maps – Skills development
3. Hiring practices
4. Organizational design
5. Talent Optimization
6. Succession planning
7. Compensation practices

Leadership teams don’t spend enough time asking questions about the skills and motivations needed to close operating gaps and strategic gaps.  Think of it this way and ask yourself the following question.

What type of people, organization design and skills will be required to close the gaps and operate the future state?  In today’s world, companies have leaned themselves down to the point where they barely have the resources to run current state day to day operations.  They most likely don’t have the resources, with the right skills, or organizational structure to get to their desired future state and operate it. It is easier to understand this concept for restructurings and digital transformations. It is much more nuanced when there is no crisis and only the need to implement strategy. Unless companies address the organizational needs of their future state, they will NEVER be successful in implementing their strategy and the statistics support that.

While we have many tools to address strategic execution, we use the Predictability Index® as our diagnostic tool for Level 2 talent optimization. With this tool, we can:

1. Identify the challenges the leadership team will face in implementing a company’s strategy
2. Highlight difficulties various teams and/or individuals have working together
3. Identify skills gaps at the senior, middle management, and individual contributor levels
4. Identify the best fit candidates early in the hiring process
5. Provide employees with the logic required for change and to define for them WIFM

The Predictability Index® provides us with detailed insights to individual and organizational gaps, which we translate into recommendations in these areas:

1. Organizational design
2. Skills capabilities
3. Skills requirements
4. Learning Maps – Skills Development
5. Hiring practices
6. Talent Optimization

Without paying attention to Level 2 of the Business Hierarchy of Needs®, someone who tells you they have a robust strategic planning and execution process does not understand strategic execution.

Issues in most companies are process and/or people related, but many companies ignore the people part. They cannot move to the future state without considering it.

If you want to find out more about the Business Hierarchy of Needs®, or strategic planning process and playbook, and our approach, please call us to talk to our Level 2 experts at (909) 949-9083, drop us a line at info@group50.com or request more information here.

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