Organizational Alignment – How Leaders Keep Their Business Growing

Organizational Alignment Growth Curve

What does it take to create and sustain high growth?

It takes organizational alignment…alignment of strategy, culture and talent…just like the three cartoon characters above pulling together to keep that arrow pointing onward and upward.

While most businesses strive for highly profitable growth, aligning all the critical factors to achieve that growth is a challenge for many leaders.  But organizational alignment is worth it.  Based upon research of 410 companies across eight industries, highly aligned companies grow 58% faster and are 72% more profitable while significantly outperforming their unaligned peers in terms of customer and employee retention and engagement.

Business Strategy

First let’s talk strategy. An effective business strategy provides direction, purpose and inspiration.  It defines where to play and outlines the critical few actions required to win by answering 7 key questions:

  1. How will you grow?
  2. How are you defining success and failure?
  3. What is your organization’s core purpose and direction? Is it inspiring?
  4. Is your strategy well understood by your employees?
  5. Do they believe that it will set them and the company up to succeed?
  6. Is your ideal target customer clearly defined and agreed to by all key stakeholders?
  7. Are your offerings unmistakably differentiated from the competition?

In addition to having a clear, implementable and believable business strategy, most high growth companies also have a potent and consistent brand that creates a meaningful connection with a desirable niche market.   They do not make the mistake of trying to be all things to all people.  They focus on what they do best, where they should win and with whom.

High Performing Corporate Culture

Once your business strategy is clear enough to act, you need to think about what kind of corporate culture you need to create to best execute your strategy.

We define culture as how things truly get done in an organization. It can be measured by understanding the way people think, behave and work. Organizational cultures exist by design or by default. And, regardless of their origin, some strong cultures help companies perform (e.g. Southwest Airlines) and some strong cultures hurt performance (e.g. Enron). One thing is certain-as a leader, if you do not understand, shape and align your culture and strategy, you will not perform at your peak. Our organizational alignment research found that cultural factors account for almost 40% of the difference between high and low growth companies.

For example, if innovative and cutting-edge offerings will be crucial to your growth plan, you need to encourage a climate where open communication, creative thinking, off-the-wall ideas and collaborative teams thrive. On the other hand, if your strategy depends upon a tried-and-true product that already has solid name recognition, you want a more “traditional” culture with a supportive structure of processes that ensure you are able to maintain market position, strengthen your brand and yet be able to adapt and scale to changing market conditions.   It is not about right and wrong.  It is all about creating the right organizational culture for your unique business strategy.

Differentiated Talent

Once you have designed your high performance culture to set you up to best execute your business strategy, it is time to find the top talent that will get you where you want to go. We define talent as the workforce that leaders must build and manage to create a unique advantage their competitors cannot replicate. One good indicator of success is observing that people who are a good cultural fit are most likely to be high performers.

Now you see where we’re headed. All three factors need to be aligned. You need the culture that will attract, engage and retain the talent that resonates with and is committed to your strategy. If even one of these three pillars is weak, your company’s health and performance is at risk.

Be intentional about your aspirations for your company’s future. It will take hard work, clear thinking, commitment, and a talented team that is engaged with their culture in a way that supports the overall strategy. Keep that growth arrow on the upswing!

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Thoratec

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Cutera

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Intuit

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AKQA

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