From Business Philosophy to Business Physics: an Analytical Approach to Strategy Execution
From Business Philosophy to Business Physics: an Analytical Approach to Strategy ExecutionJuly 10, 2020
July 10, 2020
A company’s strategy is its plan to achieve its most important goals. Strategy execution means aligning work with the company’s plan and goals. One of the most critical parts of doing that is aligning the people who make work happen — whether they’re inside or outside of a company — with the work that needs to get done.
To most business leaders, the above likely sounds pretty logical, perhaps worthy of inclusion as a basic tenet of pragmatic business philosophy. Yet quantifying and measuring the value created by this critical alignment — between business objectives, work, and resources — is an unsurprisingly difficult task. But that’s exactly what my colleague, Jorge Peña, Catalant’s Vice President of Business Transformation, is doing to help enterprise leaders at top, global companies understand the impact that the Catalant Platform and Expert Marketplace can drive for their organizations.
How is this possible? By applying quantitative approaches from unconventional but time-tested disciplines like engineering and operations, Jorge and his team gather data and analytically express the value of alignment between business objectives, work, and resources as one of the most universally understood metrics in the world: USD (and other monetary currencies). This process is known as value engineering, and our team built a proprietary tool called the Convergence Model to do it.
UNDERSTANDING THE THINKING
Convergence Conversations with Jorge Peña
Watch brief excerpts from ongoing conversations that unpack the ideas and thinking that shaped the Convergence Model’s design.
BREAKING IT DOWN
How does the Convergence Model work?
Underpinning the math that powers the algorithmic modeling of the Convergence Model is a central premise that Jorge mentions in the videos above: if you can observe it, you can measure it. And if you can measure it, you can figure out ways to improve it. The same principle applies to strategy execution and enterprise effectiveness.
Value engineering helps translate abstract business philosophy into observable, measurable, and improvable things. This starts by dimensioning the objects in question and determining the laws of physics that govern them. More plainly, value engineering can help identify things that need to be moved and figure out how different levers can move them in a better direction.
When it comes to strategy execution, our customers tell us that the three most important things to consider are:
- Objectives: what you need to do;
- Work: how you’re going to do it;
- Resources: the people who make it happen.
The Convergence Model focuses on how Catalant’s technology can help organizations increase the alignment of objectives, work, and resources to enable strategy execution and improve enterprise effectiveness. Guided by research and customer feedback, the Convergence Model focuses on three key sets of levers, each comprised of a variety of factors, that affect the alignment of the above:
- Horsepower: the rate at which work is done, affected by factors like employee engagement, operational collaboration, information and knowledge flow, and employees’ skills;
- Friction: the resistance that’s encountered during movement toward alignment, affected by factors like the complexity of services, organizations, operations, and systems;
- Strategic direction: the linkage of work and resources with objectives, affected by factors like the clarity of the objectives and communication with employees.
By asking enterprise leaders a battery of questions about the factors that affect these three levers, Catalant’s Business Transformation team can determine the baseline of customers’ current enterprise effectiveness — and can directionally quantify the potential value of using the Catalant Platform and Expert Marketplace.
The key to unlocking this value is driving alignment — or convergence — of objectives, work, and resources by increasing horsepower, reducing friction, and aligning strategic direction. “Convergence” also implies the singular purpose of why organizations even have objectives, work, and resources: to execute their strategies.
Why is Convergence so difficult?
It’s obvious to most that the key to observing anything is having a way to see whatever you want to see. For matters of enterprise strategy execution, this is where many organizations fall short, according to their leaders.
As it stands, most enterprise leaders have no visibility into what work is being executed, whether the work that’s happening is moving forward, what value the work is driving, who’s doing the work, whether those people are the right people for the work, and whether those people are engaged and productive.
Why don’t leaders have the visibility they need to drive strategy execution?
Most large companies work in silos, aimed at enabling smaller parts of what they need to do while missing the bigger picture. Traditional ways of working were the right solution during less volatile times, but most industries’ realities have changed, especially in light of the current public health crisis and the need to work in distributed, remote ways.
Pressure is mounting outside of companies. The pace of change is faster than ever, and companies face stiff competition on all sides. Customers want new products delivered in new ways, often in new markets. Meanwhile, leaders have to manage costs and deliver best-in-class returns to shareholders.
Innovation required to achieve mission-critical goals is risky and calls for capabilities companies may not have. Many leaders are still figuring out where they need to go and who, exactly, can help them get there. The people they need may already be employees, but they often aren’t. Chances are, most leaders can’t efficiently determine if their employees have the capabilities needed to execute their strategies. If they do decide to look outside their companies for help, options for accessing external resources — like other solutions for managing resources — often take too long, cost too much, and are too hard to use.
More broadly, work often isn’t aligned to a company’s most important goals, and it’s difficult to continuously align and re-align resources with strategic work. Further, critical data inputs to enable decision-making are hard to piece together, unreliable, and often out-of-date by the time leaders see reports. This also makes it hard for employees to understand why their work matters and what opportunities even exist. This leads to disengagement, lower productivity, and higher attrition.
Watch the video excerpt and access the full recording of a recent LiveCast with Bryan Fontaine, Former Executive Vice President of Bose, with Pat Petitti, co-CEO and co-Founder of Catalant, to learn how you can improve enterprise effectiveness with cross-functional execution.
Improving Enterprise Effectiveness with Cross-Functional Execution
Watch the full recorded LiveCast with Bryan Fontaine, former EVP of Global Operations of Bose, and Pat Petitti, co-CEO & co-Founder of Catalant.
How do I start the journey of Convergence?
Our SaaS platform and Expert Marketplace are purpose-built to enable strategy execution and the benefits of convergence. Catalant helps companies organize strategic work, access and allocate the people needed to do it, and track progress against what they set out to achieve.
It starts with capturing a business’ strategic objectives, breaking down and aligning work with the value it needs to drive, accessing and allocating the right employees and external resources from our Expert Marketplace, measuring work’s progress and value, and providing data-driven intelligence to improve how it all gets done.
We designed our products this way because of the insights we’ve learned from customers, who include more than 30% of the Fortune 100.