[BLOG] Formulating and Implementing a Fluid Strategy (III)
This is the last in my Fluid Strategy series. In the previous two articles, we saw what a fluid strategy means and how it can be formulated.
Today, our attention is on how to implement the Fluid Strategy. To implement is to put in effect. Thus, we shall discuss how to get the fluid strategy working to produce the desired or expected impact. However, the emphasis will be on doing so effectively.
The fluid strategy is both permanent and in motion -- much as a river flows, yet permanent. The structures that should be put in place, then, should be able to meet these two necessities.
There are six main stakeholders in management, as per the Value Pyramid for Management. These are 1) Nature 2) Society/ Humanity 3) Human Resource 4) Customer 5) Management, and 6) Shareholder.
The structures established by management should therefore address the needs and expectations of these stakeholders. Failure to satisfy any one of them would render the strategy ineffective. In discussing each of them, we will point out how the strategy can express itself as both permanent and fluid.
Nature is the most important factor to be considered when planning the fluid strategy. This is because without nature, nothing else would exist to begin with. It is therefore a necessity for management to consider: 1) How nature can support the strategy 2) How the strategy will affect nature and 3) How these effects will be handled. Let’s now examine these.
Businesses derive their raw-materials from nature. That is one principal way nature supports the fluid strategy. Some of these resources can be readily available, while others would require some work to acquire them. In either case, the strategy should analyse how they can be tapped and mobilised. This involves coordinating/organising what resources are needed — human, finance and legal — to obtain the raw-materials.
However, in order not to detract from its core operations, the company may decide to obtain those raw-materials from other companies who have that as their core business. Otherwise, in cases where there are no raw material producers, it would be strategic to create a totally separate business entity to take care of that. That business entity would then have as its client the substantive company.
And when other players come into the particular industry, they would deem it prudent to obtain supplies from this original raw-material producer instead of doing so themselves. This way, the derived company becomes self-sustaining and take full responsibility for its operations. Also, the encumbrances of head-office administration would be totally avoided.
Having figured out how the raw materials will be obtained, the next step to consider is how the strategy also supports nature. For example, how will the product be packaged and what effect will that have on the environment? How much greenhouse gas will be created and released during production and the like.
In this regard, the strategy is interested in not unduly impacting nature negatively, such as interfering with its delicate ecosystem. In-depth research, primary or secondary as the need may be, should be conducted to ascertain those data.
In conducting this research, the company should be unbiased. And if an external research institution is hired to do that job, the institution should have a reputation for unaffectedly carrying out its work. This will forestall the probability of doctoring the results to give unfair advantage to the organisation. This is where corporate social responsibility (CSR) begins.
The usual cliché of CSR is that the company must put back what it took out of society. However, even though society sacrifices a lot for businesses and suffers as a consequence from negative effects of some business practices on the environment, nature is the number-one sufferer. Hence, that adage should include what business takes out of nature as well. If it can restore it, great! Otherwise, back-off!
Next, with the results of how nature can support the strategy -- and how the strategy, in turn, will affect nature -- being known, the planners can now seek how to navigate in such a way that neither the environment nor the business suffers. However, if it comes to choosing between the environment and the business, honest precedence must be given to nature; for while there are many other business ideas, there is only one earth!
Society/humanity is the next most important stakeholder in fluid strategy planning. It is humans and the institutions put in place by them that will support the business strategy. These institutions include the political system, the economy, the family system, the educational system and the religious system. Of particular interest, too, is technology. How will the strategy impact these institutions?
For instance, bearing in mind how sacrosanct the family is in society, the strategy will have to establish how its impact will be felt by this system. But if the business selfishly ignores this and concerns itself with just the profit-motive, what will become of the future of the business if the family system breaks down? Will it have the required quality of human resources? Will it have adequate physical security to operate? This is a real concern that should matter in the implementation of the strategy.
Also, since the educational system -- both formal and informal -- is very crucial to the strategy’s human resource requirements, it will need to support both family and government efforts in that direction. Can the organisation create an education desk that liaises with and advises educational institutions on the changing requirements for human resources?
Such an approach will help in grooming well-educated human resources that positively impact production and wealth-creation. A strategy that takes this responsibly seriously becomes fluid; since as changes in the business environment happen, there are human resources that can take up the challenge and steer the organisation successfully -- thus making it resilient.
Ignoring the impact of a business strategy on society and its fabric would be suicidal. Eventually, it is not only society that suffers but also the business itself! It is therefore in the best interest of planners not to ignore these factors. And this is another level where CSR can be taken.
The human resources of an organisation are said to be the most important resources of the company -- another popular cliché, but true. For without human resources, the business will not thrive.
While this cliché is taught in management textbooks and schools, in reality that conviction is not manifest in practice. Human resources are still treated shabbily, by-and-large, as they were in the industrial revolution era of the 18th Century and beyond. I was shocked and horrified when recently I heard that one of the prestigious banks in Ghana had a unionised staff!
When I was in Sixth Form one of my friends who studied science at the O’ Level had decided to switch to business. His reason? That -- unlike with medical doctors, he had never seen bankers on strike. I believe today he would revise his notes. Would that be necessary if there were no dichotomy between management and employees, and the resources of the organisation were properly managed and distributed?
Over the years, terms such as personnel management have been replaced with human resources and human capital management. Smart! But what is in these terms? Have they truly changed the view of management that human resources are ‘labour’?
Legally, don’t we still talk of ‘labour’ laws? And we have an International ‘Labour’ Organisation. Do these not subliminally still depict workers as slaves in sweatshops; that their labour is all the organisation needs and is interested in?
To what extent are employees assimilated into the company as bona-fide ‘family’ members? Are they not still mere cogs in machines that are made to perform discrete, repetitive tasks that they are alienated from? And in economic downturns, are they not those that suffer the most by being laid-off?
Further, after taking the most productive part of the life of this ‘labour’, they are retired on funny pensions that make them paupers till they die, while shareholders bask in the fruits of the sweat of these ‘labourers’! Can’t we realise that all these factors are part of the causes of the world’s economic turmoil?
A fluid strategy would look at things differently. A fluid strategy would consider employees not as such, but as partners. It is not enough to just sell some shares to employees while the organisation continues to treat them as outsiders.
Employees must be involved in the decision-making process. In strategising for the company, their views should be input as partners in the organisation. With that galaxy of ideas, the company is able to break new ground and improve its prospects. Further, since they were involved in making the decisions, they implement these with dedication, passion and finesse.
This is one way the company can become resilient to external shocks. It would also make it amorphous enough to change its shape to meet recurrent demands.
Customers are the buoy of the company. Without the customer there’s no business. And since the needs of customers keep on changing by the tick of the clock, the organisation should also be fluid enough to accommodate and meet those needs. Doing so makes the organisation a customer-centric one.
Customers, then, should be considered in the strategy; not just as the source of income, but as very strategic members of the organisation. Hence, within the blueprint of the business should be the important role of the customer. And this should be internalised not just by the customer service team, but by every single individual in the organsation from top to bottom.
Management has been described as one of the most important social technologies developed by man. Management has the single honour of translating the strategy into reality. However, in view of the fluid nature of society and other aspects of the environment of the organisation, management should itself be fluid.
A fluid strategy is impossible with a rigid, stagnant management that is satisfied with the status quo. Besides, such a management cannot be able to navigate tumultuous times. How can management be fluid?
All the foregoing factors of implementing the fluid strategy contribute to fashioning a flexible management. Management should therefore be constantly taking stock of its beliefs, practices and processes and be auditing these in order to meet the demands of the day; very important if the business is to remain forever at age 21 and healthy!
Technology is also an integral part of management, for which reason the fluid strategy cannot ignore it. In developing the fluid strategy and during its implementation, planners should take a keen interest in evolving technology and how it can be effectively harnessed to promote the fortunes of the organisation. If the planners are ingenious enough, they can even develop the blueprint for a unique technology that can enhance the business’s operations.
If there are no immediate internal resources to develop such a technology, it can be outsourced to consultants in that particular field. A fluid strategy, then, would acknowledge that apart from benefitting from already existing technology, it should also contribute to modifying, innovating or even creating new ones. Such a creative organisation could hardly be bogged down by storms in the business environment.
Last, and of course the least, is the shareholder. In implementing the fluid strategy, the shareholder must appreciate the fact that his/her money is not the most important factor of the strategy. A strategy that is fluid will not be bogged down by lack of material capital; it will be able to find ingenious ways of producing without the capital from the shareholder.
If the shareholder comes to grips with this truth, he/she will not unduly impose his/her will on the organisation. Having the money does not make one a good manager. Hence, corporate governance should not be saddled by the majority shareholder interest syndrome. Such a strategy is inward-looking and highly myopic! Rather, it will make for progress if employees on the front-line input strategy by being involved in top-management. This is how a fluid strategy can be effectively implemented.
In all of this that we’ve been discussing, the fluid strategy cannot be effectively implemented with a colossal organisation that is too lazy to move about and turn. Hence, the fluid strategy has it that as the organisation grows it should be broken down into smaller bits. In this case, the principle of tape-worm reproduction would be very helpful.
As a tape-worm grows to some extent, it breaks in two to form a new one. A similar principle is found in mitosis; the replication of cells. By learning from and applying this principle, the organisation will be more pliable or malleable. In this way, the principle “Don’t put all your eggs in one basket” also comes into play. This is how an organisation can truly be adaptable and resilient without being resistant to change.
This is how we conclude out discussion in the series Formulating and Implementing a Fluid Strategy. What do you make of it all? How can you contribute to making the discourse worth its while? Please don’t hesitate to get in touch.
Jules Nartey-Tokoli is CEO/Managing Partner at Soleil Consults; Management, Strategy & ICT Consultants
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This article was originally posted on Africa Management Consulting Network