“Enduring companies have clear paths for how they will advance into an uncertain future. But they are equally clear about how they will remain steadfast, the values and purposes they will always stand for.”

- James Collins & Jerry Porras, authors of best-seller Built to Last, in Harvard Business Review

New organizations, or ones beset by change, often find great value in setting or revisiting their mission, vision, and values – and then comprehensively integrating those into their enterprise and the way it goes about its business. But even those firms that have been underway and been successful for a time should periodically pause to review their fundamental purpose and values. While the strategy, tactics, and business model of the firm will need to change over time and take into account changing circumstances and opportunity, what Collins and Porras call the “core ideology” should not change – what the firm is about and in what it believes.

Taking a step back and considering or reassessing Mission (Why We Exist), Vision (What We Want the World That We Impact To Look Like), and Values (What We Believe In & How We Will Behave) is a vital exercise for high performing enterprises. It serves a number of different purposes. First, it lays the foundation for the purpose of the organization and gives the firm a platform on which to build a responsive and dynamic business strategy that “fits” with the company’s core identity, ambitions, passions, and capabilities. Second, it allows the executive team to discuss the deepest questions confronting the company and ultimately “sign up” to the guiding principles that define the organization. Last, it gives leaders a clear narrative to communicating purpose and values to their employees, customers, shareholders, competitors, and other stakeholders.

In a critical step many companies miss after doing the often inspirational work of getting consensus around Mission, Vision, & Values, this exercise then focuses on the question of “How will I know them when I see them?” The integration of Mission, Vision, and Values into a firms everyday operating rhythm, its structure, its business model, its decision making, incentive and evaluation systems, and the behavior of its leaders and employees is essential if the firm is to lives its purpose. Organizations not doing this often find that the real impact of a coherent Mission, Vision, and Values never left the room at the off-site.

This exercise is often done as a 1-2 day facilitated off-site or workshop. It can also be done in the office with small groups of executives. For a more detailed description of this exercise, please contact Hillen Consulting.

“Strategy-making needs to function beyond the boxes to encourage the informal learning that produces new perspectives and new combinations…Once managers understand this, they can avoid other costly misadventures caused by applying formal techniques, without judgement and intuition, to problem solving.”

- Henry Mintzberg, Author of The Rise & Fall of Strategic Planning and Internationally Renowned Strategy Professor

Most strategic planning does not, unfortunately, reflect strategic thinking. Strategic thinking is an intuitive and forward looking art, intended to help an organization understand, identify, and commit to a different future for itself – a future that is markedly improved over its present or past situations. On the other hand, most traditional strategic planning is more akin to a budgeting process, backwards looking and relying on data or analysis of the known. . Hillen Consulting’s Objectives Based Strategic Planning Exercise offers an original and successful leadership team activity that prompts strategic thinking and results in a practical strategic plan that can guide an organization for years to come.

Without a good strategic plan (which often just resides in the heads of some of the leaders) that goes out a couple of years, organizations can sometimes just take life as it comes, lurching ahead when a good idea is at the front of everyone’s mind and there is some energy behind it and yet stagnating on some fronts when the stars are not aligned or attention is drawn elsewhere. Or, the lack of coherence and synergy between multiple areas of achievement and progress unnecessarily undermines the total effect because there isn’t a full realization for the inter-connectivity of various goals. The objectives based strategic planning exercise gives organizations a set of important objectives to strive for that together define a new strategy or strategic position and charts the ways to achieve them.

Organization’s that undertake this exercise emerges from the it with the building blocks for a concise Strategic Plan that is forward looking and created within the context of an ever-changing and dynamic future operating environment. The organization will have defined “a-great-place-to-be” or “success” in five years in key areas of activity and measurement (such as financial goals, customer or market goals, innovation goals, process goals, talent management goals and more). The new objectives will paint a picture of how the organization and the customers it serves will be in a better place for the organization being “there” in five years. In a facilitated exercise, the executive team will not only vet and choose these future objectives, but it will define goals are specific, measurable, attainable, realistic, timely,……and meaningful. If all that is present, the exercise results in the basis for a strategic plan that sums up how the organization is going to get to there…..from here. And that path includes a way to process difficult choices in prioritization, sequencing, dependencies, resource trade-offs, and other hard decisions that come up during the exercise. Last, as a leadership and team building tool, this exercise helps leadership teams see the whole picture, clarifies roles, holds executives accountable, and pulls the leadership team together around change.

This exercise is often done as a 1-2 day facilitated off-site or a series of workshops for executive teams in the office. For a more detailed description of this exercise, please contact Hillen Consulting.

“The problem with the future is that it is different. If you are unable to think differently, the future will always arrive as a surprise.“

- Gary Hamel, author of Competing for the Future, iconoclastic business thinker, London Business School strategy Professor

Framing a strategy or strategic plan around scenarios is an alternative exercise or supplement to objectives based strategic planning. The two methods overlap somewhat. Both, if conducted properly, can lead to a strategic plan for an enterprise. However, scenario based planning is an even more creative and intuitive exercise than other strategy exercises. It requires some intelligent imagining about the future, but in a disciplined and ultimately weighted way so that the organization can then make sound judgements about where to direct its strategic energy and resources. The goal of scenario based strategic planning is to create credible alternative future business environments for the enterprise and work through how the firm would address these different futures. Foresight allows for insight, as the saying goes. All the dynamics of the future environment are systematically analyzed and discussed by the team. Having chosen and organized some scenarios, identified their causes and impact, the facilitator helps the group give an initial weighting to each one. The executives then look at the decisions they would have to make, the resources they might have to commit, and the wherewithal for accomplishing their goals in each different scenario. The workshop most often ends up with some eye-opening insights about how prepared the organization is for different types of highly possible or highly consequential future scenarios. The strategy and the risk management plans of the organization are often significantly revised or recreated after this work.

The purpose of this exercise is NOT to try and predict the future. Most detailed predictions about the future, even by noted experts, tend to be wrong – sometimes very wrong. Instead, scenario based planning adds value by giving busy executives the chance to leave their left-brain “day job” for a small while and exercise their right-brain creativity skills by weighing the risks and opportunities of different possible futures. The workshop is also useful for showing the connection between alternative futures and the internal talents, resources, and capabilities of the enterprise. Even more so than planning by objectives, scenario planning helps combat the instinct of many executives (and most people!) that the future will look much like the present and evolve along a linear path. History suggests otherwise.

Finally, the workshop most often is often a fun and rewarding team-building opportunity. This 1-2 day facilitated workshop is often done at an off-site, or can be accomplished serially in office with small groups of executives.

For a more detailed description of this exercise, please contact Hillen Consulting.

“The difference between market takers and market makers isn’t product innovation, it’s business model innovation”

-Vala Afshar, author of the Pursuit of Social Business Excellence and Chief Digital Evangelist at Salesforce.

Many times a company can have an excellent strategy, but may be leaving its full potential unfulfilled by having a subpar business model. A strategy is meant to position a firm in its market, identify its distinctive approach and advantages, lay out the scope of its activities, and pining down some goals that reinforce its strategic positioning. A strategy is external facing in its presentation in many ways.A business model, on the other hand, is the way in which the company carries out its operations, its policies, and its relationship with stakeholders. It is internal facing in many ways. The great (and very funny) writer Michael Lewis wrote in his book The New, New Thing that a business model is simply “how you plan to make money.” Just so – seems very simple. But it is amazing to me how many firms do not look at their business models in the same systematic way they may look at their strategy. They simply assume that there may be only one way to price for their goods or services, one way to manage customers, one set of activities that is always theirs versus those that are always provided by partners, suppliers, or vendors.

I first witnessed the phenomenon of how a small tweak to a facet of a firm’s business model could have an exponential effect when I was an executive with a high-tech financial services firm on Wall Street. We had a crystal clear strategy that very much distinguished our position in the marketplace among competitors and others. But our business model could have been done in several different ways to support that strategy. Ultimately we could have built our pricing around selling proprietary software with licenses, or software as a service, or partnering/bundling with hardware providers or financial data companies – any manner of business model choice. All those were considered and instead we chose to give away the software and access to our systems and charge by the transaction - with a unique rebate and charging model. We rocketed to 40% margins as a result.

In a more well-known tweak to a business model, it is instructive to note what Netflix did when it saw how much of its cost basis was going pay for licensing other organizations’ content (which those content creators could also distribute through their own services). Netflix dramatically changed its business model when it invested hundreds of millions of dollars and decided to “vertically integrate” its business model by producing some of its own artistic content. These are now some of their most popular and profitable shows. Every business (and non-profits too!) face dozens and dozens of choices about how to structure their business model – from what to charge to how to manage customers to partnerships and everything in between. Outsourcing or insourcing, for instance, is a classic business model decision.

A business model is examined through a rigorous and analytical process that breaks down 1) the basic value proposition of the enterprise, 2) the resources at the command of the firm - whether organic or inorganic, 3) the processes that are undertaken in the company to get things done, and 4) the profit formula that it uses now or could use in the future. This opens up pathways to changing the business model in ways that improve financials, accelerate the strategy, shape the market, or put pressure on competition.

John Hillen leads organizations and leadership teams through this process to examine business model variations that may best help the enterprise perform…and realize its strategic ambitions. Done as a 1-2 day off-site or in a series of sessions with corporate leaders in the office, a business model evaluation and possible re-configuration can not only super-charge business performance, but it can be a rewarding and enlightening team building experience for executives as well. For a more detailed description of this exercise, please contact Hillen Consulting

“Real strategy is created through hundreds of everyday decisions. Our advice is to take a close look at where your resources are flowing. If they’re not supporting the strategy you’ve decided upon, then you are not implementing that strategy. In the end, a strategy is nothing but good intentions unless its effectively implemented.”

- Clayton Christensen, HBS Professor, Author of the Innovators Dilemma and one of Forbes 50 Most Influential Business Thinkers

The worst thing that can happen to a promising strategic plan or company strategy is that it just sit on a shelf. It becomes the elegant strategy produced at the off-site where everyone had fun and bonded but nothing was done about it. This happens far too often. But the second worst thing that can happen is that the strategy is implemented poorly or partially. This happens very frequently. One large study showed that most companies’ strategies delivered only 63% of their promised financial value.

A deliberate approach to the implementation of a strategy or strategic plan requires leadership, change management, executive team buy-in, the integration of the new strategy into the regular performance management rhythm of the enterprise, and the creation of new ways to measure new success.

Hillen Consulting’s Strategy Implementation Exercise helps companies and non-profits “bake” their strategy into their everyday operations, culture, incentive structure, processes, and operating rhythm. Through facilitated workshops or advisory work with executives, the organization undergoing this work will develop a purposeful and systematic method to track the implement of their strategy and lead change. This usually puts the organization on a trajectory towards the goals that populate its strategy – instead of leaving them as mere aspirations. It also helps direct energy and investment towards those changes that reinforce the core competencies and key competitive advantages, highlights the distinct set of operational and support activities that have changed to undertake the strategy, links them coherently, and gives executives a road-map for making priorities, making decisions about trade-offs, recognizing dependencies, sequencing action, allocating resources, and assigning responsibility.

This exercise is often done as a 1-2 day facilitated off-site or a series of workshops for executive teams in the office. For a more detailed description of this exercise, please contact Hillen Consulting.

“Managers are trained to make incremental, programmatic improvements. They aren't trained to lead large-scale change.”

- John P. Kotter, author of Leading Change. Harvard Business School professor and renowned authority on leadership and change

It is often said that the essential duty of a manager is to make order out of disorder – by applying known rules, procedures, methods, regulations, supervision, and judgement to events and processes. On the other hand, leaders often have to create all those things as they move their organizations into uncertain futures – laying down the train tracks in front of a moving train. Leaders don’t just apply the playbook to today’s challenges, they rewrite the playbook necessary for a dynamic and changing future. The more I came across both challenges during my time as a CEO or senior government official, the more I realized how different these roles were ... and are.

Change management must be a core competence of leaders, something that is now pretty well recognized. There are even a number of leadership gurus who teach that the job of the leader is to not only to lead change, but to always be forcing change – never let your organization sit still – they say. There is some merit to that, so long as the leader does it the right way and isn’t just constantly throwing his or her organization into turmoil for the sake of change. Judging by the literature on change management, it must not be a natural skill.

There are hundreds of books and training courses on change management and yet no matter how many copies of Who Moved My Cheese one passes around, it still seems an un-mastered executive competency. With so much talk of change management, why is this? First, I think it’s fair to say, is because change is hard. Even though it is patently obvious to any observer that the world is always changing – and every company and agency along with it – people still feel disrupted and dislocated by change. Some of the literature on change management assumes that leading change is hard because people naturally don’t like change. I’m not so sure. In my experience, people are receptive to change – even with its recognized difficulties and inconveniences - because they understand the advantages of beating the next guy to the future. What they don’t like is change that is poorly articulated or explained to them in ways that do not resonate with them….but rather are explained in ways that are meaningful only to their leaders.

John Hillen works with organizations and leaders who are either preparing for change, in the middle of a wrenching change process, or are struggling with a poorly implemented change. His workshop or on-site office sessions with executives separates out the institutional steps from the executive leadership steps and helps leadership teams sequence their efforts around leading change and change their leadership behavior to make it more effective. From launching a persuasion campaign about the need for change in general to establishing a sense of urgency around a specific move to forming coalitions and empowering others right on through to institutionalizing the changes, John gives expert guidance and planning support based on his teaching and experiences leading dramatic institutional change in government, non-profits, and businesses.

Change can be dictated overnight by executive fiat of course, but if it’s not deeply connected to organic values and purpose and the unique DNA of the organization….it will be less sticky. This is particularly true in today’s more democratized, emotionalized, and egalitarian management environments. I don’t know many people these days (even in the military) who get things done in complex organizations by telling people to do it “because I said so.” The leader must be able to discern the connections between values of different constituencies, the DNA of the organization, and authentically tie the benefits of the changes to those value systems. And then explain it – over…and over…..and over again. This turns out to be the best path to get followers to truly own the change. A co-authored change between leader and led will be rooted in a shared narrative about the why, what, and how of the change. Why’s, what’s, and how’s that everyone can articulate in their own terms – not just the ones on the corporate PowerPoint. All good stories have a moral – or a moral basis – and they appeal to the hearts of listeners and readers. So too with a good change management process. It must be explained in a way that appeals to the hearts of the followers, not just to their incentive plans.

Recognized and awarded leadership prizes for his change leadership skills, John helps executives and organizations work through this most difficult of leadership tasks.

“In essence, the job of a strategist is to understand and cope with competition. Often, however, managers define competition too narrowly, as if it occurred only among today’s direct competitors.” “Strategy is about setting yourself apart from the competition. It’s NOT a matter of being better at what you do – it’s a matter of being different at what you do.”

- Michael Porter, author of Competitive Strategy and On Competition, Harvard Business School professor and competition expert.

If much of the art of strategy is distinguishing your company from others in the marketplace, then wisdom starts with understanding that marketplace. The great strategist Michael Porter reminds us that “the essence of formulating competitive strategy is relating a company to its environment.” Understanding, mapping, and analyzing that competitive environment is the essential prerequisite for not only forming a strategy, but just re-looking at a dynamic and rapidly changing world to see if one’s strategy has been overcome by events.

I often see companies make two mistakes when they take on this task. First, they do not think competitively enough. They are often too wrapped up in their own issues and their own ideas to take the time to understand the forces of competition arrayed against them (yes…against them!) and how to react and counter-punch to make their strategy work despite these forces of competition. We would do well to remember that Intel Founder Andy Grove chose to title his book Only the Paranoid Survive!

The second mistake is that firms fail to define competitive forces broadly enough. Most executives can easily get their head around direct competition. But, as Michael Porter (him again!) showed in his classic Five Forces of Competition model, there are many other dynamics that act like competition other than direct competitors. He introduced the competitive pressure exerted on firms by customers, suppliers, new entrants, and substitute offerings. There are even more forces than these – rapidly shifting attitudes and tastes and the sheer dynamism of technological and global change.

Hillen Consulting conducts an exercise with executives that looks at their competitive environment as a full ecosystem – taking into account not only the macro-changes shaping it now and into the foreseeable future, but also the role of partners, adjacent players, and the more direct forces of competition. The exercise balances for risk and uncertainty, knowing that past is not a linear journey and nor will the future be. But the leadership teams that look most deliberately and analytically at their full environment on a regular basis are the most prepared to shape it and not be shaped by it. Companies undertaking this exercise are inevitably more prepared to make changes to their strategy that keep them at the forefront of change, rather than being a victims of changing times.

John Hillen leads organizations and leadership teams through this process in a 1-2 day off-site or in a series of sessions with corporate leaders in the office. For a more detailed description of this exercise, please contact Hillen Consulting.

“Analysis of external change forces is critical to determining what strategic changes a company should consider. An assessment of internal strategic resources and capabilities and of pressures for and against change is important to determining what strategies a company successfully can (and should) pursue.”

- Cornelis DeKluyver, author of Strategic Thinking and numerous other strategy texts, acclaimed business school professor.

In the same way that an examination of the competitive environment concentrates on the Opportunities & Threats of a classic SWOT analysis, a look at an organization’s strategic resource base provides insight about Strengths and Weaknesses. All successful strategies are rooted in Who The Company Is – its core competencies and capabilities. And that identity is very difficult to separate from what the company has in terms of its resources. It is hard for a company to execute a strategy that is inconsistent with its physical assets, talent base, history and identity, financial wherewithal, processes and traditions, and its culture. Some companies see “an opening” in the market based on their external analysis but realize too late that they themselves are not equipped to exploit it. There are many such examples, but I am reminded of Coors launching a sparkling water product in the 1990’s. They were right about the increasing demand in the US – soon to explode – for sparkling water. But wrong to think that an iconic beer company could produce it with the same success as their beer.

Fit matters. In this exercise I often apply something called the congruence model to the analysis as we start to frame out possibilities. The congruence model is an analytical framework that allows the organization to see if a proposed strategic action is consistent or congruent with who the company really is. Will the values and behaviors of the culture support and enable the strategy? For instance, a company that has a culture of punishing failure will have a hard time experimenting if that is what they now determine can drive their strategic success. Does the organization and structure fit the strategy? The work flow and processes? The people and skills in the firm? And so on.

Hillen Consulting’s exercise in this area aims to get agreement and understanding about a company’s strategic resource base and its potential for enabling the strategy or flexing to support new strategic ambitions. Importantly, no company should be a prisoner of its current capabilities and resources – those can all change. An understanding of the gap between who we are and who we need to be is often the most powerful insight to emerge from this exercise. Then companies can plan to build, buy, or borrow the internal capabilities they will need for their future strategy – or to fix the current one.

This is a fantastic exercise for the self-examination of an enterprise by its leaders. Executives often use this process to then “tune” the organization so that it has a better chance to hit its strategic goals and succeed. John Hillen leads organizations and leadership teams through this exercise in a 1-2 day off-site or in a series of sessions with corporate leaders in the office. For a more detailed description of this exercise, please contact Hillen Consulting.

“We are in a fully global economy. One way of approaching that is to pull the covers over your head. Another is to say: It may be more complicated - but that's the world I am going to live in, I might as well be good at it. “

- Phil Condit, former Chairman and CEO of Boeing

John Hillen has lived, worked in, or traveled to almost 70 countries. He has served on over eight corporate boards with foreign ownership and operations and he and teaches International Business Strategy in the MBA program at George Mason University. He helps companies construct and implement international business strategies in the face of opportunities and challenges from the globalized business environment.

Globalization and the promise of possible international business opportunities for an enterprise force leaders and companies to deal with complex strategic decisions regarding whether and when to internationalize, which markets to pursue, where to locate key activities, how to enter markets, and how to manage and organize across borders.

In very structured workshops or exercises, John helps companies understand and factor into their planning: (1) the current state and challenges of the global business environment in their industry; (2) strategic considerations they will have to consider as a result of globalization and other environmental phenomenon, (3) specific business and corporate strategies for entering global markets and competing, and (4) management considerations for running a global business. Companies frame answer and plans to issues around sources of global competitive advantage, foreign market entry strategies, emerging market strategies and unique challenges, managing global alliances and an international business network, understanding cultures across the globe, managing customs and practices across the world, cross-cultural communications and learning, and understanding and evaluating a global strategy.

This can be done as a 1-2 day facilitated workshop at an off-site, or can be accomplished serially in office with small groups of executives. For a more detailed description of this exercise, please contact Hillen Consulting.