Following up previous HighPoint posts on common strategic planning missteps, the importance of limiting strategic imperatives, and how leadership alignment can make or break a corporate strategy, we wanted to share a few insights on why assigning metrics to each imperative is a major contributor to a strategic plan’s long-term success.
Once appropriate prioritization of the core business, delineation between near-term and longer-term imperatives, and leadership alignment are realized, the management team must then determine the metrics and frequency by which success will be measured. In fact, the initial conversation about and up-front definition of these metrics needs to kick off immediately on the heels of the debate and decisiveness surrounding strategic planning imperatives. It is the final step in making the imperatives feel real, as a barometer of commitment. Both the ‘cold hard steel’ of challenging stretch metrics and the illustration of intangibility in certain imperatives will prompt strategic refinement of those imperatives to make outcomes more concrete.
As with determining the top strategic imperatives, when it comes to assigning metrics, fewer is again better. HighPoint recommends identifying the top 2 to 3 metrics (not including sub-metrics or sub-business unit derivations) linked to the successful outcome of each down-selected imperative.
Who’s responsible for overseeing metrics capture?
Metrics should never be an afterthought, nor should they be left to business units or divisional finance leads to figure out retroactively. First-level metrics must be defined with the executive leadership team that drove the choice of down-selected strategic imperatives and who are the most informed on their intended outcomes. Strategy project leads or others may join later, but persons outside the core management team will not have the full context of the leadership team’s sharpening discussion around narrowing its top imperatives. Further refinements or revisions to each strategic imperative can come out of first-level metrics definition. If that exercise is left to an offline, single individual, the leadership team will lose out on the final stage of refinement before implementation, which has the possibility of eroding previous leadership alignment. Once the first level is defined, then business units and assigned strategy or financial team members should make the necessary sub-derivations for different entities and for the monthly/quarterly equivalents of 1-year and 3-year metric outcomes.
With the metrics in place, HighPoint Associates likes to see the CEO and Leadership Team sponsor metrics reviews with a weekly PMO and assigned analytic team (e.g., finance) to report back on each imperative’s performance on a monthly basis. This reporting should cascade first to the CEO and Leadership Team, then to stakeholders throughout the organization to assure everyone is on the same page as to which imperatives are on or off track to date and to drive corrective measures.
HighPoint Associates will help your business achieve measurable strategic success.
Our expert consultants have been on internal management teams and have learned how to bring clarity to strategic imperatives and rapid executive alignment to drive results. They will also establish measurable milestones and metrics that highlight a business’ ongoing progress against its strategic goals. If your company is embarking on a corporate, business unit, or go-to-market strategy, contact HighPoint to start the conversation.