Posts Tagged setting priorities
“In strategy it is important to see distant things as if they were close and to take a distanced view of close things.”
– Miyamoto Musashi (宮本 武蔵), famous Japanese swordsman (~1584-1645) in “The Book of Five Rings” (五輪書)
The more businesses urgency increases, the more important it is for business leaders and managers to regularly step back and reflect on the 3 cornerstones supporting the development of an healthy organization: the understanding of the overall business environment and related company directions, the appreciation of the company teams situation and the alignment with one self as part of the management team. Answering the questions from this post is a first step that should help any leader to initiate a deeper thinking exercise when and where required.
Download a one-page executive summary here (PDF or JPEG format): Leader Checkpoint: 9 critical questions
As leaders and managers, growing a sustainable organization requires to constantly align the company business, the teams in charge of delivering on the company mission and oneself. If only two of these three cornerstones are in sync, disaster is very probably a matter of time…
More concretely, imagine the result for your company, your teams and/or yourself in the following misalignment cases:
Alignment between Business environment and Self but unsynchronized with Team: As a manager, you are fully motivated and aware of what you have to deliver with which support, with a clear understanding of your company priorities under the given business context, but your teams do no longer understand the company strategy and do not follow on the required organizational changes; key staff attrition increases rapidly…
- Alignment between Team and Self but unsynchronized with Business environment: Under your leadership, your team has reached a high level of maturity leading to strong performance; you have supported its development leveraging with agility on your management strengths and expertise while continuing improving on your weaknesses and you have built a solid relationship based on trust and respect with your team members. Nonetheless neither you nor your team understand any more what the customers expect and how the company is trying to answer to those new needs…
- Alignment between Business environment and Team but unsynchronized with Self: Your company has just identified new trends changing the landscape of your industry and is preparing the necessary organization adjustment; your team gets clearly why a change is needed at that stage but you are already over-loaded and do not know whether you would have the ability to lead an organizational change at this stage while handling in parallel some personal difficulties…
In order to (re)initiate the thinking process on those 3 cornerstones, answer the 9 questions below in the “Practice” section. To some questions, answers may pop instantaneously whereas, to some others, you may stay perplex. In any case, note down your answers; they can be used later as a basis for a deeper study by yourself, with your teams, management or peers. Take the time to run this checkpoint exercise once or twice a year at least (at a time and in a place where you can focus).
exercise 1: Reflect on your business
- What makes your organization unique in the value it delivers to its customers?
- How does your organization anticipate and answer to the forces (re)shaping your ecosystem?
- As part of the management team, what does your company expect you to achieve to support its mission in both a short-term and long-term perspective?
- exercise 2: Reflect on your teams
- If you’d ask each of your staff to explain in 2 minutes what your company position and uniqueness are, as well as what the expectation regarding their individual and team contribution in supporting the company mission is, what would be the result?
- If you had to rebuild from scratch your organization, which of your current employees would you ask to join, in which role and why?
- How does the development plan set for your teams and their members match the individual trajectories?
- exercise 3: Reflect on yourself
- What are your top 3 personal and professional successes and failures over the past 12 months?
- What is the “one thing” that you want to achieve personally and professionally over the next 3 months, 1 year, 3 years, 10 years and how?
- What are the intrinsic or extrinsic conditions that could prevent you from aligning with your company objectives and with your teams?
From your business universe, your teams, yourself, taking time to grasp the context and to understand the situation at hands is what will allow you to set the relevant action plan to support the development of your organization, teams and self on the long run. Running regularly a simple 9-question self-reflection on your business, teams and self can help you to identify areas to study and discuss in deeper details as a next step.
Last Revision: 2015 March 28
“The good-to-great companies did not focus principally on what to do to become great; they focused equally on what NOT to do and what to stop doing.”
– Jim Collins, US business consultant and author (born 1958) in “Good to Great”
The Pareto Principle also known as “the 80-20 rule” or “the law of the vital few” simply stipulates that, in many cases, a minority of causes generates a majority of the effects. Representing your key business data in a simple Pareto Chart and identifying the “vital few” will help you to define the areas where to primarily focus (or not) the time and resources of your organization.
Download a one-page executive summary here (PDF or JPEG format): The 80-20 Rule (Pareto Principle) for tactical decision making
Vilfredo Pareto (1848 – 1923) was an Italian civil engineer, economist and sociologist who had great interest in studying various social distributions such as income and land ownership. After collecting and compiling a large number of data, he has noticed that 80% of the land in Italy was owned by 20% of the population. As Pareto studied other domains, he observed that the same non-linear distribution pattern was persistently reproduced.
This pattern, where a minority of the inputs is responsible of the majority of the outputs, was later called the “Pareto Principle” or “80-20 rule” and has been since then broadly observed in different domains. Note that, in reality, the distribution can obviously be different from a 80-20 joint ratio (As a matter of fact, following Pareto’s initial discovery and conclusion, those figures are commonly used to explain the principle itself).
The minority of the inputs leading to the majority of the results is called the “vital few”, as opposed to the “trivial many”.
In the graph below, also called Pareto Chart, you will see for example the number of client complaints related to a specific product, sorted per decreasing number of complaints, (left-hand side Y-axis) and the cumulative percentage of complaints per product (right-hand side Y-axis). What Pareto principle tells us here is simply that, in order to solve 80% of the client complaints, you need to fix your quality issues with Products A to I also called the “vital few”. Investing your time and resource on improving the quality of the “many trivial”, ie Products J to T, will only reduce the client complaints by 20%…
It is then clear that Pareto principle becomes a simple but nonetheless powerful tool to support your investment decisions (resources, money, time, energy…): focus on the “vital few” and ignore the “many trivial” (that can be eliminated, delegated, postponed till further notice depending on the type of decision you are involved with).
Note though, that it is recommended to use this principle only when a large number of categories and observations data are available. Besides, interpreting the data under a Pareto prism must not prevent you from running a deeper analysis of the situation. What if Product L of the above chart is a strategic product for your company in the coming years whereas Product B is becoming obsolete? Focusing on improving the quality of the “vital few” products will for sure help increasing your client satisfaction on the short-term but what about your mid/long-term investment strategy? Shouldn’t you start now with resources working on enhancing Product L as well?
- case 1 – in a Service Desk management role: how does the Pareto distribution of the incidents raised per customer look like? On which “vital few” customers will you focus first to reduce drastically the number of complaints?
- case 2 – in a Sales or Business management function: draw the Pareto Chart of your organization profit generated per customer. Who are the customers that you will NOT put under a dedicated relationship management program aimed at reinforcing retention in a first stage?
- case 3 – in a Quality Assurance management position: What are the functionalities of your software used 80% of the time by your users? What can you deduct for your QA resources allocation and test automation initiative?
Defining the relevant long-term investment strategy for your organization usually requires an exhaustive, time-consuming analysis and interpretation of a large set of data. Nevertheless, for a short-term tactical allocation of your resources, interpreting your key data under the Pareto principle turns to be an efficient method to set quickly your priorities: identify and focus your effort on the “vital few” items/tasks that will give the majority of the results and disregard the “many trivial” others!
Last Revision: 2015 March 28