Craig Apatov / Strategic Marketing Practice Leader
Most companies are immersed in planning next year’s areas of strategic focus and supporting operational budgets. While mid-level management is often charged with tactical budgetary planning it is the job of senior management to ask the tough strategic questions not being asked elsewhere in the organization.
The responsibility for asking tough organizational questions falls on C suite level executives because these individuals charged with growing and evolving their companies well into the future. Senior executives must think outside the bounds of current organizational issues and growth challenges. They must make the difficult decisions regardless of the politics associated with them.
The Courage to Challenge the Status Quo
Top executives must challenge the internal status quo or risk failure in the most important job they have….keeping their organizations relevant, well positioned in the marketplace, and on the road to consistent profitable growth.
Senior leaders are well compensated for a reason. They are the ones charged with insuring their companies can remain competitive, evolve over time, and achieve consistent year-on-year profitable growth.
Successful enterprises realize the future is not a given. Markets can change on a dime. Competitors appear and disappear in a blink of an eye.
Complacency Leads to Disaster
Complacency is often at the root of failure for many companies. In today’s hyper competitive business environment senior leaders must be objective, nimble, and courageous.
Consider the following companies who took their eyes off the ball and disappeared forever:
- Kodachrome Film – Failure to react to the growth in digital photography resulted in the end of a 74 year old iconic product line
- Max Factor – Despite being purchased in 1991 by Procter & Gamble the once venerable cosmetics brand disappeared in the US while retaining a rapidly declining foothold overseas.
- Newsweek Magazine – Inability to react to the growth in digital content delivery amid falling ad revenue and mounting operating losses resulted in the brand being sold for a mere $1.00.
- Circuit City – Caught in a three horse race without a meaningful differentiation strategy Circuit City became the victim of traditional retailer Best Buy and online giant Amazon.com.
When approaching organizational planning for the new fiscal year it is the responsibility of top management to ask the tough questions. These questions that are not easy to answer and often cause discomfort at various levels of the organization.
Where to Focus
Regardless of industry most companies face similar competitive and growth issues. While the specifics will vary from company to company the major areas of focus are often stunningly similar.
In our work with companies across a broad spectrum of industries globally we have observed top performing organizations ask themselves the following questions in order to insure they are well positioned to achieve future growth targets:
- Is the organization properly structured to achieve its growth targets?
- Have we segmented our market and key channels properly?
- Are we properly positioned in our retention + growth markets?
- Do we have the right talent in the right places?
- Have we allotted growth funds to align with areas of greatest opportunity?
- Am I personally close enough to daily processes to influence dollars in key strategic areas?
- How are we funding critical R&D to drive consistent growth?
- Do we have a process to appropriate incremental funds if strategic opportunities arise?
- Are we willing to re-allocate monies to critical areas even if politically unpopular internally?
- Am I a confident leader or a consensus manager preferring leadership team buy in?
- Are my key functional leaders empowered to make mid-course corrections if indicated?
- Do we have a program in place to fill key management gaps quickly?
- Do we have a succession plan in place to insure our future success?
- Have we optimized our available compensation funds to incentivize leaders properly?
- Do we have an equitable “performance based” compensation system to drive growth?
- Am I personally close enough to organizational performance issues to influence them?
- Do we have a regular, recurring performance review/coaching/mentoring process in place?
- How do we measure success?
- Are we using a consistent sales planning template customized to our business?
- Are our front line sales managers challenged to analyze their territories/accounts?
- Do we take an “objective” look at our market, competition, and growth plans annually?
- Can we improve our planning/review by involving cross functional leaders in the process?
Now is the Time to Act
The most successful leaders know that the time to act on next year is now. The planning cycle should be a time of objectivity, reflection, and definitive action by informed managers. Success in today’s marketplace does not come easy. It requires a constant level of research, questioning, and course correction.
Effective senior managers…
…take the initiative to ask themselves and their organizations the tough questions.
….are not afraid to throw plans out the window and start over with a fresh informed perspective
…regularly survey their customers and prospects to identify delivery gaps and unmet needs
…reallocate funds and restructure management to address competitive and marketplace changes
…remain personally close to monthly results and issues to enable them to make changes when needed
Most of all successful leaders force themselves to be “objective”. They know they must deal with reality if they are to compete effectively in a rapidly changing and increasingly competitive world!