Beyond the Blueprint

I often meet with business leaders who are struggling to understand why they are not achieving the results outlined in their strategic plans. After digging deeper, it becomes clear that many have not adapted their organizational structure to enable effective deployment of their strategy.  This misalignment can occur at the corporate, divisional/ regional, or even functional level.  

Here are a few examples from our recent client work. In each of these cases, we recommended organizational structure changes that enhanced the likelihood that our clients would achieve the results outlined in their long-range plans.  

Large, publicly traded industrial manufacturer:

Strategy: Big bets built on several enterprise-wide strategic initiatives  

Structure:  Regional P&L structure which controlled the resources to execute these initiatives (both funding and people)  

Challenge:  When the regional leaders needed to trim costs within their business units to meet quarterly targets, funding for these global initiatives were often cut or resources redeployed.  

Recommendations:

• Funding for enterprise-wide initiatives resides within the Chief Strategy Officer’s global organization
• An Enterprise Program/ Project Management Office should be built within the CSO’s organization with dedicated resources to lead these initiatives, provide executive visibility to progress and any risks to successful implementation, and develop and execute effective mitigation plans
• Additional support for execution would be leveraged within the regional structure, but leadership roles would be dedicated to the initiative and sit outside the regional structure
  

$800M privately-held manufacturer  

Strategy:  Significant growth through innovation  

Structure: A product management organization that was built around particular products/ product categories, some of which had strong brands with meaningful expansion opportunities and others that were limited in scope.  

Challenge:  No one organizationally was accountable to drive innovation outside the existing product categories (e.g. adjacent categories, new applications of the same technologies to other use cases, etc.).  Further, no one person owned any of the “brands” in the portfolio, so no one was accountable for thinking about where their brands could be extended into new categories or even further afield into services, media properties or other non-traditional areas.

Recommendations:

• Shift to a brand management organization, where each brand owner is responsible for identifying and capitalizing on relevant brand extension opportunities  
• Create an innovation team within the marketing organization responsible for understanding consumers’ unmet needs, tracking emerging technology trends and new products globally, and working with brand owners to create and commercialize new products both inside and outside current product categories

 

$100M PE-owned financial services company

Strategy: Aggressive growth targets established by new ownership required a totally different approach to the market

Structure:  Sales organization was entirely focused on identifying and closing small, transactional deals with the end consumer

Challenge:  It was impossible to scale the current marketing and sales strategies cost-effectively to deliver the growth objectives

Recommendations:  

• Reorganize sales function and create a new account management role entirely focused on managing relationships with a key point of aggregation of these end consumers and critical influencer in the decision process
• Design a “hunter” role to initiate relationships with new points of aggregation
• Shift end-user transactional sales activity to an inside sales function

Concerned that your organizational structure might be standing in the way of successful execution of your strategy?

Ask yourself a few key questions to determine if your structure is optimized to deliver desired results:

1. Who is accountable for generating results from this initiative?  If your answer is “No one”, “multiple people” or “I don’t know” it is time to rethink the resourcing plan.
2. Who owns the resources (budget and people) to deliver this? If your answer is someone other than the answer to #1 (or “everyone”, “no one”, “I don’t know” or “the CEO”), you have a problem.
3. Is there at least one person who is fully dedicated to leading and executing this initiative (assuming, of course, that said initiative is important enough to be identified in the strategic plan)?  If your answer is no, then reassess the organization’s commitment to the initiative overall.  If the organization is truly committed to a particular initiative, it should be willing to redeploy or hire at least one FTE to lead the charge.  
   

If you are trying to understand why your business is not achieving the results it desires or aren’t sure how to bring your organizational structure into alignment with your strategy, Candela Partners can help.  Message us on LinkedIn or contact up via the 'get in touch' form for more information.