How important is the Execution Decision in your business? Execution results in achieving higher gross profit margin which translates into higher earnings and net profit. Execution is all about efficiency and performance. It’s achieving better results with fewer people, better systems, communication and relationships. It means effectively translating priorities into metrics, meeting frequently to monitor progress and achieving successful outcomes.
Want to get an immediate measurement on your Execution score for your business? Download the Rockefeller Habits Checklist now, score your responses, or better yet get your team to fill out and score how they feel the company is doing on these Ten Disciplines and you’ll see immediately the areas your business needs to improve upon to have the necessary discipline to achieve better results in gross margin and net profit.
We continue today with more Execution Growth Tools designed to reduce your businesses risk from leaving significant revenues, profits, and time on the table. The four decisions your business must get right are: People, Strategy, Execution, and Cash.
Today we explore Theme and Individual Plan.
Theme: On April 13, 1970, 173,790 nautical miles from Earth, the oxygen tank on the Apollo 13 spacecraft unexpectedly ruptured, creating a potentially catastrophic moon flight for the program and placing 3 astronauts in great peril. There was no disaster recovery plan for this unanticipated scenario and initially the mood and outlook in mission control was pessimistic to the point of resigning themselves to failure and the death of the 3 astronauts. As precious minutes of life ticked away (using up what little oxygen was left), the team on the ground in Houston, Texas, became almost paralyzed with indecisive “analysis paralysis.” Differing opinions on what action to take, combined with the negative mood, resulted in a team member commenting on how disastrous this development was for the Apollo program.
It was then that the Apollo 13 flight director (Gene Kranz) firmly and courageous stated words to the effect of “failure is not an option.” The concept that “failure is not an option” immediately became infectious and the rallying point for solving the challenges, with energy and focus unseen in the program up to that point to bring the astronauts safely back to earth. It became the theme of the mission of Apollo 13 and, 3 days later, the astronauts were safely back on Earth after the heroic execution of an improvised mission plan – all because of the power of the theme “failure is not an option.”
If you’re a history buff or recently watched History Channels Sons of Liberty you know that our country was founded upon the theme of, “No Taxation without representation” or “Taxation without representation is Tyranny!”
Every organization, in any given period of time, has one thing, above all else, that will drive performance in the desired direction and toward the desired outcome. A company’s goals and priorities will not be successful if they are easily forgotten or ignored. The key to helping people remember what is most important in any given time period is to MAKE IT MEMORABLE. Whether it is the next quarter or the next year, as a leader you must help anchor your entire team or company to make a vivid, reinforced emotional connection that generates undeniable and enduring commitment.
One of the best ways to do this is through the creation of a theme. An effective theme – centered on the one thing that will make the biggest difference in terms of results and performance – galvanizes the imagination and unleashes the creativity and confidence of your entire organization.
We’ve discussed Themes several times in the past including Measure Fun – Employee Engagement – PHX Growth Summit, What’s Your One Thing for the 1st Quarter?, and All Aboard! Align Your Team – Theme Kickoff. In addition far too many organizations promote negative reinforcement rather than the positive reinforcement a theme generates. Read Examples of Negative Reinforcement for ideas on how you and your company might be promoting the opposite result that you desire.
Individual Plan: Take a look at the One-Page Strategic Plan again and you’ll see on the far right is the place for your personal quarterly plan. Just like our quarterly plan, the 3 sections of the individual quarterly plan should all work together.
Unlike the quarterly planning process, where all of the members of the teams work together to create the company quarterly plan, this section everyone needs to focus on their own individual areas of the company. Typically, the individual plans are shared with the CEO and or team leader/manager for alignment.
Before you begin your individual plan, it’s a good idea to review the quarterly plan because the company quarterly plan should serve as the driving force behind your individual plan.
Take a look at the “Quarterly Priorities and KPIs” worksheet in your Growth Tools. You can see a copy of this on the right: Start by establishing 1-3 individual numerical targets (goals) for the quarter in the top section of your plan. These KPIs help to track the performance of the department to make sure that the department itself is functioning correctly. Let’s take time now to write down the KPIs to track for your area of the company and the numerical targets on those KPIs for this quarter. Remember, these should support the company’s quarterly numerical targets.
Once you have established your numerical quarterly goals, begin working on your priorities, the key improvements that you want to make to your area of the organization. Aim to have at least one priority that contributes toward the company theme and critical number. Brainstorm and develop a list of priorities for the quarter (you can brainstorm as many as you can think of, then carefully select your top 3-5). Remember to assign a due date.
The next step in the individual quarterly planning process is to think about your critical number for the quarter. Ask yourself “To achieve my numerical targets and priorities, what should be the focus for this quarter?” Then ask “How will I drive that focus?” Find the one number that your department needs to meet or surpass. Then apply target levels (success criteria: red, yellow, green, super-green) to the performance of the critical number to make it real.
The next step in the process is to create a counterbalancing critical number. What is likely to go off the rails if we over focus on the critical number that you have developed? What do we need to measure to make sure that we stay on course? These concern Balance Productivity and People. Read the blog to understand how too much focus on a priority can adversely affect your business. Once you have developed your counterbalancing critical number, once again apply target levels (red, yellow, green, super-green) to the performance of the counterbalancing critical number.
The final step is to review the plan (KPIs, priorities, critical numbers) to make sure each section supports the other sections and the company quarterly plan.
We still have two more Execution Decision Growth Tools ahead, Dashboards and Success Criteria. We’ll discover them next blog.