The September 2005 edition announced a series of articles on “Thinking 'world-class' at the Southern Tip of Africa” and that we would be focusing on each of the characteristic of 'world-class' organisations over a series of 7 Articles.

These researched characteristics were defined as

Management Today is inviting organisations to benchmark themselves against these researched 'world-class' best practices for the duration of this series at (insert MT web address that will take respondents to the related site)

Whilst participating organisations will be given structured feedback by the research team, the data collected over 7-8 months will be combined to produce a lead article on South African business ratings against 'world-class' criteria and best practices.

We pick up with Andre’s research on how 'world-class' organisations strategise:

MT: Could you start with an overview, after which we can delve into key aspects of how 'world-class' organisations strategise.

In a global economy where 'world-class' organisations continually flex to improve on customer needs and expectations, good is never good enough. They create and live innovative stretch strategies which are always recreating the future as a way of life. Continual future creation and improvement renders conventional strategic plans prematurely obsolete which means that strategic planning is an organic, continual process to stay ahead of an ever moving beacon which is the strategic intent. This inner urge for progress lies deeply rooted in their core ideology which works hand in hand with their envisioned future.

Everyone in the organisation partners in continually improving processes where there is close alignment of strategic thinking with all other interdependent practices and systems in the organisation The way in which this alignment is lived by, either repel or attract people to the organisation. Careful synergistic alignment of overarching and interdependent strategies creates a balance and harmony that eliminates waste and drives high performance.

MT: Why is that 'world-class' organisations view their strategic plan as continually obsolete?

It is all about satisfying ever demanding customers who know that the whole world is their ‘shopping counter’. The perpetual race for ‘front line’ position by 'world-class' organisations, who know that they have to continually innovate and improve, is driven by continual strategising that can rapidly flex to meet changing customer needs and expectations.

The need for continual future creation therefore is a need for ‘metamorphoses’. The biological meaning of the word suggests a ‘change process’ as opposed to the outcome of the change itself. In organisation language, this describes the building of strategy as a continual process because the intended outcome of the plan in a rapid and exponentially changing environment renders the outcome of the plan obsolete before a neatly packaged strategy is achieved. Continual crafting of the strategic intent is therefore what makes it relevant and always current to the changing business landscape.

MT: You talk about “Future driven creation strategising”. What does it imply?

The ‘formal’ strategic plan is no longer the true guiding light of a 'world-class' organisation because its time horizon and orientation is to give effect to a desired business plan. ‘World-Class' organisations are therefore not fixated on a time horizon dictated by a strategic plan but reference all their actions against a strategic intent. This implies viewing the ‘intent’ as a constant beacon of where the organisation wants to be into the future and then taking their people there in their imaginations.

The notion that the strategic intent consists of the sum-total of the desired future position and state of the organisation is well illustrated by a 'world-class' Coca-Cola bottler in Oklahoma City. Clear on their desired future position and state, this organisation is continually evolving to higher levels of performance. They are never satisfied with “what is”, always in search of “what could be”. In so doing, they are continually improving their processes to get better at arriving at their moment of truth which is “customer satisfaction ahead of expectation”.

Great Plains Coca-Cola’s reference against strategic intent

Source: Great Plains Coca-Cola (2003)

Tornados which are common to the great plains of Oklahoma and exert their force as a total synchronised weather system, has been adopted by Great Plains Coca-Cola to explain their ‘future creation’ continuous improvement process. Always “customer focused”, the process starts with continual future creation at the widest ‘big picture’ level of the tornado. The desired future position where “what can be” is continually discontent with “what is”, drives continuous improvement. This evolves in continual process improvement and strategy development which are interdependent and drive each other. Teams, in which shared responsibility fosters business partnerships, embrace values where respect and trust is the norm. As the focus narrows, quality and eliminating waste provides for continuously improving customer service.

For an organisation to fulfil its vision and purpose, maintain competitiveness and achieve sustainable growth, it is essential to continually upgrade its reason for existence by winning – and keeping the hearts and minds of satisfied customers.

This explains why a ‘once a year’ strategic planning process is avoided like plague by 'world-class' organisations.

MT: What is the source of this kind of thinking in 'world-class' organisations

‘World-Class' organisations realise that in order to create the future (as they envision it to be) they have to take charge of the future. This means creating a ‘stretch’ future which suggests that for these organisations, allowing the future ‘to be what it will be’ is simply not good enough. The future needs to be pulled back into the present so that resources can be leveraged to make it a reality. It is also a philosophy where the ‘present’ is always seen as ‘past tense’ and where ‘what could be’ becomes a mindset which is always in a future creation mode.

This ‘inner urge for progress’ is deeply rooted in the core ideology of these organisations who are seen as ‘visionary’ since they are continually focusing on beating themselves - not so much as the end goal but as a residual result of always wanting to do better, never thinking that they have done good enough.

'World-class' organisations begin with a set of core values that are energising and capable of unlocking the human potential of their people. Although these organisations decide for themselves what these enduring core values are, some form of innovation is likely to appear on their list of values. The very fact that their purpose is forever pursued but never reached means that such organisations can never stop stimulating change and progress so that they can live more fully up to their purpose. Consequently, a combination of ‘core values’ and ‘core purpose’ continually stimulates and drives stretch and innovation through and into the envisioned future of the organisation. When people feel connected to something with a purpose greater than themselves, it inspires them to reach for levels they might not otherwise obtain.

The envisioned future contains what Collins and Porras in Built to Last. (2002, p82) call “hairy audacious goals”. These goals describe what a ten to thirty year future may look like. The vision, also influenced independently by the core values and core purpose, puts it all together and describes a ten to thirty year effort to complete.

MT: What approach do 'world-class' organisations adopt as they continually strategise?

A flywheel accelerates from continuous and consistent pushes, maintaining its own momentum since it is perfectly aligned and balanced. And once it has gained critical momentum to drive everything within and with it forward, it becomes an internal source of energy to the organisation that ‘teaches’ everyone in the organisation ‘the way’, “motivates the troops” and “manages change”. But to “spin” at speed and retain this momentum, it has to be perfectly balanced and aligned in the direction it is going.

In practice this means careful synergistic alignment of overarching and interdependent strategies and allocation of resources to ensure that there is balance and harmony of efficiency to attain and sustain high performance. The the builders of 'world-class' organisations seek alignment in strategies, tactics, organisation systems, structure, incentive systems, building lay-out, job design, in fact, in everything.

The introduction of unrelated and disjointed strategies, which lead to unrelated practices, are avoided like plague by 'world-class' organisations. For example, it is unlikely for a ‘global minded’ 'world-class' organisation to announce that it is to introduce a ‘continuous learning culture’ because it is a widely reported characteristic of ‘world-class' organisations. Such an organisation will already be a ‘process based’ organisation where autonomous teams interface with customers along the value chain and are continuously learning.

Because their thinking is dominated by continuous improvement, members have to be multi-skilled where life-long learning emerges as a natural phenomenon and lives in harmony with all other interdependent practices and systems within the organisation Three hundred and sixty degree appraisal, where fellow team members, suppliers, and customers in the value chain provide feedback to teams and individuals on how they perform, becomes an almost involuntary natural phenomenon. It does not have to be created or imposed on the business as a ‘good idea’ or the ‘latest thing’ to do.

The essence thus of 'world-class' organisations comes in the translation of their core ideology and vision into the very fabric of the organization, into their goals, strategies, tactics, policies, processes, cultural practices, management behaviors, building layouts, pay systems, accounting systems, job design – in fact everything that these organisations do. 'World-class' organisations create a total environment that envelop employees, bombarding them with sets of signals so consistent and mutually reinforcing that it's virtually impossible to misunderstand the organisation's ideology and ambitions.