In my first post in Understanding your Organisation I presented a really simple image that helps to understand the relationship between strategy (concerned with future well-being), operations (concerned with the delivery of service/product to current customers) and management as the function that integrates strategy and operations. Scarily simple – but I have found it to be a powerful framework for understanding organisations of all sorts – and for quickly spotting the root cause of under-performance.
I have found several different types of problem using this simple model. Firstly we have what I call the ‘Destruction of Management’. This is caused by the different priorities and drives of operations and strategy. The Ops folks are focused on systems and processes that are designed to service current customers efficiently and effectively. They are fiercely ‘customer facing’ and push management for time and other resources to improve current operations to meet customer needs. All well and good. Just as it should be. Their perspective can be described as predominantly looking ‘inward’ (how do we improve what we have got) and down – towards the front-line.
Now the strategy folks have a different set of interests. They are interested in the art of possibility.
- Who could we be serving?
- What could we be making?
Their eyes are set on the technology and markets of the future. They are fiercely ‘future’ and ‘change’ oriented. Their perspective can be described as outward (what is happening ‘out there’ – technology, market demographics, prices etc) and forward looking (how do we get what we need in terms of knowledge, technology and processes to compete in the future?). They pressure management to dedicate resources to bringing this new future a step closer.
So management is caught between operations pulling ‘inward and down’ and strategy pulling ‘forward and out’.
Most management finds it difficult to resolve these tensions between strategy and operations.
In some organisations the strategy folks win (they usually have more positional power in the organisation) and the ops teams become jaded and cynical as they are asked to engage with strategic initiative after strategic initiative – continually engaging in change that rarely seems to make things better in the ‘here and now’ – and often pulls them away from doing good work at the front-line. They start to seriously doubt whether anyone in the boardroom really knows what the business is about.
In other organisations the strategy side is very weak and the organisation becomes myopically focused on the ‘here and now’.
In other organisations (and in my experience this is the most common situation) both strategy and operations are relatively powerful forces in the organisation and management is just not strong enough to hold the forces together. Neither great operational improvements nor insightful strategy gets executed as ‘weak’ management uses the opposing forces to negotiate a mediocre status quo.
- How do these strains play out in your organisation?
- What steps can you take to ensure that progress is made both operationally and strategically?