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Organizational Alignment

Organizational alignment is an important concept for leaders to consider. This is especially true in the current fast-paced, complex, and constantly changing environment. According to the Tronvig Organization, organizational alignment means ensuring a brand operates 360 degrees: both externally and internally. An organization's core values should be translated from an abstract set of words into a real set of behaviors that make sense within each staff member's daily responsibilities.Organizational alignment is the secret ingredient that is often missing for many businesses. But a high level of organizational alignment is essential for achieving increasingly better results now and in the future, which is why organizational alignment is so important. Many organizations are struggling with changes in their external environment as a result of change that is quite disruptive to the organization. These external changes can lead to non-alignments within the organizations.Most executives today know their organizations should be aligned. They know their strategies, capabilities, resources, and systems should all support the central purpose. The challenge is that leaders tend to focus on one of these areas to the exclusion of the others, but what really matters for performance is how they all fit together. I have gathered from various company thoughts some principles to get me better personally aligned so I can lead well. These are the thoughts I am sharing today.Start by thinking about the golden arches of McDonald’s. What does it take to be able to serve over 1% of the world’s population—more than 70 million customers—every day and in just about every country around the world? Processes, routines, and culture selling, stand-alone, standardized products are sold everywhere at a predictable and manageable volume, quality, and cost. Efficiency, scale, accountability, routinization of tasks, and teamwork are all built into the design of its winning organization. McDonald’s has been the market leader in its arena for decades.This is what alignment looks like. It means winning through a value chain that connects the purpose (what we do and why we do it) to its strategy (what we are trying to win at to fulfill our purpose), organizational capability (what we need to be good at to win), resource setup (what makes us good), and, finally, management systems (what delivers the winning performance we need). Alignment is vital—the value chain is only as strong as its weakest link.Why are there relatively so few businesses and organizations that succeed as McDonald’s has? Where do we go wrong?

  • Leaders are unaware of the risks of misalignment.Many senior executives do not think of their businesses as connected value chains. They focus on their org chart. The main operating units on the chart are considered the primary components of “value.” Alignment thinking requires alldecision makers to view their organization as a value chain, not merely a set of boxes and wires on a chart.

  • Nobody “owns” organizational alignment.No one is really responsible to see that it happens. Multiple individuals and groups are responsible for different links of the value chain, and usually they are not closely joined. All too often, individual leaders seek to protect and optimize their own links in the chain, rather than align and improve across the entire organization. Who is responsible for ensuring your organization is as strategically aligned as it should be? The answer cannot be “nobody” or “I don’t know.” Neither can the answer be “the CEO” (or equivalent). Today’s culture is too complex for design and management to be left to chance or to rely on the one who leads the entire enterprise.

  • The larger and more diverse, the more difficult and necessary alignment becomes. Achieving and sustaining high level alignment is hard, especially in a rapidly changing environment. Four primary factors affect this: number of employees, variety of products or programs, variety and expectations of differing customer groups, and geographical locations. Large, diversified, and geographically distant organizations, in whichever sectors they compete, require the greatest amount of strategic effort by their leadership to be aligned. There will be no lasting success unless your leadership team is well-equipped and committed to beat the alignment challenge.

  • Activity is mistaken for progress.A pragmatic, lone ranger approach (it’s easier and faster to just do this myself) and the frantic activity of business as usual can get in the way of the in-depth discussions and tough choices that need to take place regularly to lead a strategically aligned organization (and maintain it). Ensuring that the whole organization is as aligned as possible should be business as usual for leaders. Without the big vision and understanding of their best selves within the organization, leaders will lack the direction, proper ambition, and impetus required to fulfill the potential of their link AND the potential of the organization.

These questions, posed by successful organizational leaders who have aligned their organizations, are very helpful. Consider the following questions with your team.What do we do and why do we do it? Purpose is the foundation upon which every organization is built. Financial success is the consequence of a business fulfilling its purpose well, but it is not to be confused with the organizational purpose itself. Attendance growth is the same for churches. It’s the result of fulfilling the purpose, but is not the purpose itself. Profit and attendance are rarely positive foci for people’s effort.What is your enduring purpose? Why would it matter if you went out of business tomorrow, and who would care? Is your purpose clear enough that your investors, employees, partners, and customers/clients/members could articulate it?What are we trying to win at to fulfill our purpose? If purpose is what the organization exists to achieve and why it matters, then strategy is planning for what they must win at to fulfill the purpose. Purpose stays firm, but the strategy should flex and morph in response to future opportunities and threats. The degree to which your strategy fulfills its purpose is the measure of its effectiveness.The Walt Disney Company’s stated purpose is to “create happiness by providing the finest in entertainment for people of all ages, everywhere.” How Disney creates happiness is by offering a range of products (Disney Store, publishing, licensing), entertainment (Walt Disney Studios, Pixar, Marvel), and experiences (parks and resorts). It wins by pursuing high performance in each area and by using each to support the others. See how intertwined they all are? No area becomes a link unto itself.What do you offer customers in the form of products, services, and experiences, and are they consistent with your purpose? What’s missing? What do you do or offer that you shouldn’t? Who are your customers, and what are they demanding of the products and services you offer, now and in the future? Who are your competitors, and what do they offer that you don’t? How do you need to be different to win?What do we need to be good at to win? Even the best strategy is useless unless supported by appropriate organizational capabilities. It is reckless leadership to commit to a strategy without knowing whether they can achieve it. In today’s culture, agility (around the customer), connectivity (between complementary offerings), and innovation (to explore novel opportunities) are highly desired.What do you need to be really good at to successfully achieve your winning strategy? What are you capable of organizationally that your rivals are not? How do you become uniquely capable of fulfilling what the culture is demanding of you, now and in the future?What makes us good? (And how good are we?) Strategically aligned organizations are made capable by their resources, including people, structures, cultures, and work processes, and by the degree to which they are connected to guide the organization. People reflect the value of skills, experience, and knowledge required to perform the necessary work; structure reflects the value of formal and informal relationships, networks, and functional connections through which work is structured; processes reflect the value of planned and ad hoc work processes and routines through which work is done and valuable knowledge retained; and culture reflects the values, beliefs, and attitudes that guide everyday working behavior in a productive direction.What type of people are core to you being superior at the things you need to be good at to win? What type of culture might support collaboration with others? What types of work processes are critical to your ability for inventiveness and connectivity? What type of structure will enable you to be agile enough to compete for and win fickle customers, yet maintain your brand for long-term growth? Our decisions MUST come from our value chain, not be made because of a solitary situation, or the organization’s weakness.What delivers the winning performance we need? Management systems include all aspects of the organization, from information systems to employee performance management.What management practices, systems, and technologies best fit your winning strategy for fulfilling your purpose? What are appropriate measures of success, both short and long term? Where is the focus of effort and attention from your managers and leaders, and is that focus of effort aligned to how you plan to win?Without organizational alignment as a primary focus, single links in your chain will have brief “flash in the pan” moments of success. But they will be dependent on the charisma and character and durability of that particular leader or resource, and the cultural mood. They will not last, and the organization will not thrive. Organizational alignment must move to the top of your list if you want to have success today and be here tomorrow.

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