Making Room at the Top Table

Increasing Accountability for Project Outcomes at Board Level

There are many reasons why change programs fail but one thing is for sure…the buck stops with the board. If companies are to be successful it is essential business leaders are effective change leaders. Change is inevitable. In fact, change is necessary to ensure companies remain competitive and evolve in a direction that maintains or increases their chance of survival. Strategy is not enough. Leaders who practice strategy may have great insights or ideas about which markets to operate in, which products to sell, which features to develop in their products and services etc. But strategy is ultimately trying to second-guess what customers already know. In today’s world, customers set the strategy necessary for success in business. Customers dictate which companies survive or fail by their buying decisions. The customer is still king.

Typically in large organizations, Chief Strategy Officers (CSOs) are the architects of strategic change. The role consists of two distinct responsibilities: strategy formulation and strategy execution (aka change delivery). However as AI, data analytics and experience management solutions become more sophisticated they are helping business leaders better understand the rationale behind customer buying decisions, thereby making strategy formulation less of a guessing game. Consequently CSOs need to find new ways of adding value by shifting their focus to strategy execution and achieving competitive advantage by improving this next level down in the value chain. The CSO role is still relatively new in the corporate world but according to a survey by the Harvard Business Review, CSOs do not generally emerge from predictable backgrounds with easy-to-map career paths. They tend to exhibit a wide rage of skills and experiences. However they have one thing in common - almost all CSOs previously worked in operational roles.

This presents a potential weakness in corporate strategy execution. CSOs like other board executives are used to being short on time and spending much of their energy keeping the lights on. A short review of available literature reveals they are great crisis managers, rapidly absorbing information, making critical decisions and solving present-day issues to maintain business operations - typically because they’ve perfected a reactive mind-set and rapid problem-solving response from many years of working in operations. However, paradoxically this means many CSOs may lack the skills necessary for successful strategy execution. It wouldn’t be unreasonable to question whether CSOs have the proactive mind-sets, risk management skills and natural planning ability necessary to deliver on their strategies. Is this a missing link in the value chain? The essential connection between ideas and outcomes?

This is where experienced change leaders can add most value. Often CSOs and other executives intuitively know why change is necessary but having an operational mind-set inhibits them from understanding the what and how of change delivery. However, experienced change leaders understand what the company needs to do and how to do it. Furthermore, although effective business leaders are aware of their own weaknesses it’s very possible many still overestimate their own knowledge of delivering change; or they underestimate the importance of having experienced change leaders in the boardroom. As Donald Rumsfeld once put it, “you don’t know what you don’t know”.

Consequently there’s an empty seat at the boardroom table. At best there seems to be a significant gap in accountability that may explain the general consensus that most change programs fail or fall short of expectations. Speaking from my own experience, change leaders have always been seen as down-stream deliverers. In the minds of many executives they operate ‘outside’ the normal business as facilitators or 2nd party service providers. They execute strategies, not participate in producing them. But business leaders need to recognize unless their executive board has deep experience of managing change, representation on the board by an experienced change leader is essential to the future survival of the company. Business leaders must be careful to appoint CSOs experienced in strategy execution and change leadership if the board lacks deep knowledge and experience of delivering organizational change.

Like other executives, experienced change leaders have risen through the corporate hierarchy in project, program and portfolio management before leading departments dedicated to delivering organizational change. Consequently they have a particular mind-set and thought process and some very specific personal traits. They are natural planners with an ability to anticipate future events and understand how to prepare. This makes them highly effective at crystalizing corporate or business strategy by working with customer-focused executives such as Chief Marketing Officers, Chief Revenue Officers and Chief Customer Officers.

Furthermore, they turn strategies into plans, mobilize resources needed to deliver their proposals and participate in the entire value chain, ensuring shareholders get a healthy return on their investment. Strategies and plans go hand in hand. Change leaders understand the difference, but more importantly they understand how to bridge the gap between the two. Ultimately, Change leaders understand how to take ideas and turn them into profit.

In an IBM survey, 92% of change practitioners cited executive sponsorship as the most important factor in successful change programs. But with so many failing or falling short of expectations, business leaders need to find better ways of ensuring the board are ‘bought-into’ these change programs, many of which originate there as boardroom strategies. Since CSOs are responsible for executing strategy, bridging the gap could be achieved by extending their involvement to the very end of the project lifecycle so they work hard to ensure their strategies deliver expected outcomes and genuine ROI. And if business leaders appoint CSOs with deep experience in delivering change (rather than operations) this would help ensure they had the right skill set to execute strategies and not just formulate them. Maybe its time for business leaders to make room for a bigger strategy role at the top table. Recruiting ‘Chief Strategy and Change Officers’ rather than CSOs may help raise the profile of change delivery in bridging the gap between strategy formulation and successful execution. Ultimately if boards have better change leaders, fewer change programs will fail.