In order to bring about that often sought after, but rarely achieved, alignment of a business, you need to start by aligning the numbers. Aligning the numbers begins with having a clearly articulated financial plan. In order to create alignment in any organization, the financial plan needs to be translated down through the organization, so that every individual knows how the things that they are doing day in and day out affect the overall goal of the company. To illustrate the point, here is an example.
That same puzzled look crossed his face, but this time it was because he didn’t know the answer to the question, but realized that he should. You can’t align your business if the people in your organization don’t know where you’re going and how to get there.
When you align the plans of your business so that they are properly translated, you have now given your frontline leaders better tools and expectations to manage against. CEOs that I speak with who strive for accountability are drawn to this concept. Their financial plan is properly translated, now the leaders know what is expected of them and their people.
But don’t expect all of your leaders to use this newfound accountability in a positive way. Here’s a story to illustrate my point. I was the Vice-President of Operations for a company and I loved accountability. I thought it was the answer to performance improvement in organizations.
After exhausting all possible explanations, I resorted to reviewing the back-up tapes of the company (for those that remember those days!). What I could see from the information on the backup tapes was that the numbers in the spreadsheets were changing every day as the Plant Manager was trying to manipulate the scrap rate.
So be warned: accountability, if it is not used properly, can actually be a double-edged sword and create misalignment in your organization.
Andrew Rush will be leading a session on May 7 at the IndEx 2019 conference on “Performance and Cultural Alignment and its Key Role in Value Creation”. To learn more about how to affect real change in an organization, Carpedia International has put together an ebook that outlines 52 targeted areas to improve performance in any business or industry. Download the ebook.