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World Class Challenge

Organizational culture has long been accepted as a critical factor in the execution of daringly new business strategies and ideas. But culture is actually only part of the story. The entire social ecology of an enterprise (its ethos, purposeful evolution, state of being and identity) is a significant element in an organization's internal capability to deliver on its strategic ambitions - along with other things like plans, resources (time, skills, human and financial capital) and know-how.

Internal capability allows a company to change both what it does and how it does this. It is naïve to believe that strategic goals can be achieved merely through dictate or willpower. On the contrary, four key prerequisites need to align:

  • Internal and external conditions need to be receptive to any new strategy
  • The strategic intent has to resonate well with both market and customer expectations
  • Resources have to be made available
  • An appropriate social ecology needs to exist - or be shaped.

Consequently an organization's emergent social ecology, including the dynamics brought into play by various components of this ecology, must always be taken into account when determining strategic direction and intent. Frequently, the most courageous of intentions remain unrealized (and unrealizable) simply because external conditions are misinterpreted and social ecology is ignored.

Executives always need to pose relevant questions: What is the present state of our organization's social ecology? How might that present state impede or assist particular goals? What will need to change, and how, if a more strategically appropriate social ecology is to be acquired?

In order to answer these questions I will use the results from a global survey examining world-class performance, which we undertook recently. As in previous years, social ecology emerged as one of several key factors. Within this category, the following seven outcomes were seen to offer clear evidence of world-class performance in today’s zero geography landscape:

  • Brand resonance – top-ranked on value, strength & emotional connection
  • Reputation – best rated service founded on trust and professionalism
  • Innovation – continuously out-performs peers on creativity and innovation
  • Flexibility – the ability to adapt and respond rapidly to unforeseen circumstances
  • Peer “envy” – management practices most admired and respected by peers
  • Client credibility – consistently preferred by blue chip clients
  • Employer of choice – attracts and retains top talent effortlessly.

This year we decided to undertake a second, more detailed survey. This was designed to illuminate those practices seen to be vital for sustained growth and prosperity. Thus, on completion of the initial survey, a group of 50 CEOs from among the top-ranked companies in the world were invited to propose four strategic principles that would assist companies in their journey towards becoming better in their chosen fields.

Without being overly prescriptive, these four principles can be used as a framework for thinking through how an organization's inherent strengths can be leveraged more effectively to combat perceived weaknesses and drive long term progress.

Letting go of the past in order to rethink who you are and what you value is the scariest thing. Sometimes it means jettisoning the very processes, products and business models that have brought you to where you are today! But today's business landscape is not like it was even five years ago. In fact it has become so dynamic and so unpredictable that just failing to keep up can spell disaster. 

The past (manifest in people's habits and customs) exerts an almost gravitational pull that tries to keep things the way they have been. Maintaining the status quo will always appear attractive to some executives, especially where risk-averse cultures are common. 

In order to get to the future first the best companies confront these factors head on. Keep the best of what works today but create new value through innovation. Be brutally honest. Debunk the myths that go unchallenged so as to sort out and nurture what is of real value to your company's future. 

This will entail divesting under performing assets, finding innovative ways to grow the business, managing costs more intelligently, investing in learning and development, discarding mechanisms and models that are no longer working for you, and liberating the real value locked up in your web of global networks and relationships.

It is impossible to out-think markets; they are far too complex, capricious and fast. However, in order to keep on the front foot you do need to adapt instantly to changing conditions. Being this alert should enable you to meet client needs in as near to real time as makes no difference. Alertness of this kind requires mechanisms in place for monitoring, learning from, and adapting to changes in the market, anticipating future trends, and using strategic intelligence to make more informed decisions. 

Most Western companies are far too bureaucratic – built for efficiency rather than speed. Now is the time to get rid of unnecessary trivia, flattening the structure and liberating leadership at all levels across the firm. You will be surprised at how better placed you are to take advantage of emerging opportunities as they arise.

The market needs to be clear about what you stand for, what sets you apart, what your aspirations are, and how these connect to the overwhelming concerns and beliefs in contemporary society. You cannot afford to be out of touch with society. This applies to the firm as a whole as well as to the individuals who make up your company. Such clarity helps grow credibility and reputation. In today's world reputation is critical. It also helps to be unique – or at least distinctive in some form or other. 

In staking out your own unique territory you must exploit your most deeply felt principles if you are to connect effectively with the stakeholder community of which you are a part. Make sure you communicate this ethos consistently. Do not deviate from it under any circumstances, as this will only confuse the market.

Taking responsibility for your actions helps build coherence in the minds of customers. It also creates an emotional attachment that leads to brand resonance, increased loyalty and, ultimately, world-class leadership.   

In today’s multi-polar, globally-distributed economy, world-class businesses depend upon deep relationships and collaborative networks in order to build success. A vigorous network of relationships with high profile business leaders, entrepreneurs, politicians and senior bureaucrats across the firm's market space is particularly vital. Today’s very best CEOs identify the most influential people with whom they must continuously interact – then use their time in maintaining and nurturing the relationships that matter across this preferential network.

Leveraging know-how and intelligence flows through preferential networks is also crucial.  Few corporations actually get the power of networks... Yet! 

Networks do not function like hierarchies. They are based on different axioms – diversity, abundance and generosity of spirit, for example. But if you understand these operating axioms you can grow value in ways that lead to increasing returns. In no time at all, your organization's culture can change as executives develop the confidence and capability needed to prosper.


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