Current economic pressures highlight the importance of an effective and high-performing organization.

More than ever, it is necessary to ensure that all your operations and activities reflect your strategic choices and priorities.

Ironically, the funds needed for your transformation may be right before your eyes, hidden within the deeply ingrained habits of your organization.

Indeed, your business practices reflect the accumulation of past decisions and are rarely perfectly aligned with the current strategy.

This situation creates a unique problem.

Working to build this alignment requires resources. And in a volatile economic context, these are more difficult to access. Many organizations cannot fully invest in their necessary transformation.

But What If The Resources Were Already There?

There is significant financial potential associated with misaligned activities and operations. I am not talking about performance (efficiency) but rather about the potential associated with activities not aligned with the strategy (effectiveness).

Remember: Effectiveness is doing the “right thing”; efficiency is “doing the thing right.” In other words, effectiveness is choosing the right projects; efficiency is carrying them out with the least waste possible.

Over the years, we have repeatedly worked with clients who faced difficulties or market disruptions. To implement new priorities, they first turned to the hidden potential within their operations.

A few years ago, one of these clients wanted to reinvest heavily in marketing activities to boost sales. The company was facing a decline in growth for the first time in many years. As a key player in its sector, maintaining a strong presence in the market was the strategic priority.

We worked with the team to clarify and maximize the value creation generated by the entire value chain.

The results: an economic impact of over 20% on operating costs, which allowed for a significant reinvestment to support sales efforts.

This type of intervention has been carried out with companies of different sizes and operating in different sectors.

Ensure Strategic Alignment Of The Value Chain

Here are the key elements of the approach that focuses on value creation and the alignment of strategic choices (effectiveness):

Preparation

1. Start with the strategy. Be clear about the strategy needed to address current and future challenges. Document the choices, activities, and competencies that support value creation. Identify the necessary transformations leading to the desired organization.

Diagnosis

2. Identify the gaps in the current organization. Analyze the various operating sectors, the income statement, and the entire expenditure portfolio. The strategy choices revolve around the organization’s activities, the allocated resources, and the choices of different partners.
3. Categorize and identify the profiles of needs, business practices, and operating standards. How is the desired value expressed through specifications, expressions of needs, and current performance?
4. Review the alignment of the organization and its practices with the priorities and strategic choices.
5. Identify optimization opportunities throughout the value chain. Operating standards, choice of practices, choice of partners, mastered competencies and unnecessary ones.
6. Establish a work plan for potential gains and the efforts required to achieve alignment objectives. Ensure to clearly identify the value to capture.

Implementation

7. Start work by focusing on quick wins. Aim for high potential gains with high ease of implementation. These gains will generate positive momentum and finance future transformations. Each organization will determine the project approach specific to its culture and targeted objectives.
8. Proceed in phases. Keep in mind the balance between ease of implementation and potential gains. Correct, optimize, or eliminate. Alignment ultimately requires an effective organization.
9. Allocate the captured sums to promising projects that can elevate your organization. Reallocate resources according to strategic priorities.

Monitoring

10. Ensure governance of the approach. Continuous monitoring is necessary to anticipate budgetary impacts and confirm the results achieved. Moreover, by conducting such a project, the organization develops a unique perspective on value creation. The learnings that result must be integrated into current practices.

Again, this approach is applicable to any organization. Regardless of the sector or size. Of course, the magnitude of the results may vary, but the essence and value of the exercise will remain the same.

The benefits of alignment are significant. Before focusing on the efficiency of operations, it is imperative to focus on effectiveness. By ensuring that the various activities contribute to value creation and strategic choices, this maximizes the chances of success.

Courage Required

However, executing such an approach requires courage and determination as a leader.

Some run their organization by maintaining this alignment continuously. Strategy management is omnipresent, and adjustments are then punctual and specific. Others wait for a crisis or a major disruptive event to realize this alignment. The changes then have the potential to be more dramatic for the organization.

In all cases, this adjustment is required.

As a leader, the means are there to transform your organization. It is time to take action and unleash this potential.

Have a good week,

Eric L'Heureux

PS. When you are ready to move forward, here are two options to propel your leadership and your organization:

1. Take advantage of our support to define your strategy clearly and establish priorities with your team.
2. Join our IAE-Pro Community to develop your strategic means of action (in French for now).