Message to Motivate: Meeting the goals of a complex strategic transformation
Services USEd in thE case study:
Team building
strategy workshopS
organization-wide strategy communication
change management
project managemenT
strategic advisorY
CASE STUDY: Supporting a CEO in the Strategic Transformation of a Global Business Steeped in Tradition.
A well-established company with a turnover of over a billion dollars had embarked on a strategic transformation from a R&D focused pharmaceutical business to a commercially-oriented company with a growing consumer (private pay) portfolio. The transformation was highly complex, as the product portfolio, core competency, financial profile, and most critically, the culture of a 100-year-old company needed to adapt to the new strategy. Tremendous progress had been made over the past three years. The CEO had built a new executive team, strategic acquisitions were undertaken to build a critical mass of product offerings, and he had implemented a decentralized operating model to make the company more customer-oriented in unfamiliar markets. When I joined the team, two crucial tasks remained, to facilitate a company-wide culture catch-up and to adjust the financial profile of the company. My work focused on advising and supporting the CEO in both these tasks.
Situation:
The strategy of the company had been well-defined and communicated to customers, however, awareness and acceptance of the strategy amongst employees was low. The rapid succession of acquisitions had made the company a melting pot of cultures, each with a different understanding of the strategy. Moreover, the de-centralized business model served the customers well but added to confusion around the role of the different executives at the company. The financial profile of the company reflected the old strategy both in terms of spending and resource allocations. However, in order to ensure that changes to the financial profile was sustained, it was essential to first address the cultural transformation.
Steps Taken:
Cultural Transformation:
A culture survey was conducted and several informal meetings were held with employees in different locations and levels of the organization. This information provided a baseline from which, the CEO and I worked together with his executive team to implement the following initiatives, based on the Kübler-Ross Change Curve:
Kübler-Ross Change Curve
1. Team-building and operating model: Workshops and team-building sessions were held with the executive team to build alignment, clarify roles and responsibilities of each functional area, and strengthen relationships. Outcomes of these sessions were captured in a “strategic transformation” communication document that clearly articulated the strategy, values, operating norms, operating model (including roles and responsibilities) and the executive team charter. The document also included communication and implementation guidelines for each of these elements. Equally important as the document itself, was the process of its development and review, as the multiple rounds of discussions served to strengthen the team dynamic of the executive team, securing a sense of ownership and ensuring the information captured was authentic and reflected their beliefs. Also, to note is that during the process the materials were tested informally with a varied group of employees, and the feedback was shared with the CEO.
2. Launch: A company leadership meeting, held biannually, for the top 100 leaders from across the globe was leveraged as a launch platform for the strategic transformation. The CEO led the majority of the two-day program, clearly articulating the information in the communication document. In addition, with the support of his executive team, he outlined the implementation plan, covering financial and strategic priorities for execution. In terms of structure, the meeting was carefully balanced with content, team-building and networking opportunities, in order to give participants enough time between sessions to digest and discuss the information. In addition, there were multiple Q&A sessions, in different formats, built into the agenda to encourage participation from the globally diverse audience. The leadership team left the meeting energized and with a consistent message. Immediately after the meeting communication materials and guidelines were shared with the leaders and local HR to disseminate to their organizations.
3. Broader communication: Virtual quarterly town hall meetings were instituted that were open to all employees across the globe. The meetings were held in multiple languages to ensure all employees could participate. Technology was leveraged to aid global audience participation with employees being able to submit questions via online chat in real-time. At the first global town hall, the CEO shared a summarized version of the content shared at the company leadership meeting. He encouraged employees to get more information from their local leadership, thereby employing the classic push-pull strategy to drive information flow. The global town hall was also leveraged to share the company’s annual strategic priorities for execution. During the year, progress on the strategy execution, a financial update and key achievements were shared at the meeting. Furthermore, in every town hall, the employees were reminded of the strategy, values and operating norms.
4. Employee recognition: An Annual CEO Award was instituted to recognize stellar teamwork and increase the visibility of talent across the company. Participation was open to teams across the globe and applications were submitted directly to the CEO’s office. A five members selection committee was put together based on the recommendations from the executive team and HR. The committee was globally represented, remained anonymous to everyone expect the CEO’s office and changed every year. The committee reviewed the applications and made recommendations for the finalists to the CEO. As the committee worked directly with CEO, being selected to be part of it was coveted by employees. For the award ceremony, representatives from the finalist teams were flown to the company’s headquarter for a celebration. The celebration included interactions with executive team, an exclusive ceremony with the shareholders, trophies and prizes.
5. Evolving communication: Overtime a transparent and authentic tone to the leadership culture was established. The next step was to leverage this environment to find common solutions to business issues in the decentralized commercial organization. This was accomplished by inviting the commercial leaders a day prior to the global leadership meetings to discuss and share best practices in sales strategy and operations. These meetings were very well received as it not only gave leaders tangible solutions to improve sales performance, but also served to build relationships between local leaders from different countries. In addition, it provided an avenue to discuss more tactical and operational issues in a leadership setting.
“Manasi contributed significantly to the successful outcome of the following transformation projects: “Global Restructuring Project”, “Global Leadership Summit”, “Annual Company Objectives” “Sales force Summit” and “Annual CEO Award”. Her holistic and systematic approach, her excellent organizational skills and her energy enabled her to excel.”
Financial profile:
The work on a global restructuring project began two years post launch of the strategy transformation. This had provided enough time for the strategy to resonate within the organization and revenue in the strategic focus areas to develop scale. The global project was announced during a town hall meeting along with a commitment to a swift completion and regular updates.
An initial top-down analysis conducted by an external firm found that other than savings from personnel resource optimization, most other opportunities were in a “long tail” of minor expenses. Therefore, accurately identifying and implementing sustainable savings would require engaging employees across the hierarchy who were analytical and could drive change in spending behavior.
We created a task-force with members from each functional area. The task force was selected based on recommendations from the executive team, middle management and HR. The team was briefed of the initial analysis and then empowered to identify and implement cost-saving programs in their respective areas. The implementation of personnel changes were completed by experienced HR team members who worked in close collaboration with the employee advocate groups. The entire project including the implementation of the savings was overseen and managed directly by the CEO’s office. The task force operated with the same transparent and interactive communication style that had, by this time, taken root in the culture. The tools used to review progress were simple and easy to use. The progress meeting followed an etiquette that reflected the operating norms, and were action-oriented, mandatory and included executive leadership in relevant functions (e.g. HR, Finance) for the purpose of problem-solving and prompt decision-making. Once the measures were implemented the savings were presented to the Board and built into the budget by the corporate finance team.
Success Factors:
Consistent communication: The CEO’s communication initiatives remained a priority. Even when the business was going through a rough patch, the CEO and his team continued to maintain transparent communication.
Employee engagement: Employee feedback was solicited and difficult questions were answered without consequences. Employees empowered to drive change in their respective areas and recognized for their initiative. However, guidelines were established that employees were expected to follow.
Accountability: CEO and his team role-modeled accountability. When issues arose they discussed them openly, provided solutions and immediate course corrections.
Simple and effective processes: Communication and tracking tools were developed that were easy to follow and focused meetings on relevant matters.
Successful Outcome:
The global employee survey results showed a 11% improvement (from two years prior) in communication of the strategy and goals, and a 18% improvement (from two years prior) in trust of executive leadership to execute the strategy. In addition, the survey participation rate was 87%, which represented a 9% increase from two years prior.
Finally, operational efficiencies of $35M were gained as part of the global restructuring project. Note: The survey was conducted after the global restructuring project was completed. Since the successfully completion of the transformation, the company has continued to grow its revenue and profits.