The Governance process is the place where behaviour change happens. For perspective in a survey Bain & Co completed across 184 companies, it found that 65% of initiatives required significant behaviour change. However, in many cases, the Governance process rather than a driver of change is a source of significant inefficiencies. Most commonly due to either insufficient discussion and investment early on to determine the lead measures that will meet KPIs/budget or the frequency of review meetings being too low. In the absence of knowing the lead measures and having a weekly scorecard, the Governance process regularly becomes a diffuse, more opinion rather than fact-based discussion resulting in missed opportunities to course correct early and quickly. This gap almost always results in ineffective execution, in R&D it can result in poor-performing projects consuming time and investment for much longer than necessary, in manufacturing it can result in poor planning decisions and low yields in commercial loss of customers and in all cases ultimately impact on financial performance.
At a minimum, the process requires two critical requirements –
- A weekly tracker with a small set of lead (activities) and lag (for example, number of backorders or market share) measures. With an expectation that there will be some iteration to hone the lead measures over time.
- A weekly meeting to review, diagnose and course correct, which is treated as the most important meeting of the week.
In that regard, in any given week the business leaders' knowledge of the health of their business should only be one week old. This is difficult at the beginning to initiate and maintain, (and therefore requires senior leadership support), however, the rewards from spending time on this make it the most critical step to ensure the proper execution of a strategy. The alternative is potentially months of teams performing the wrong work!
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