We work with many large, global organizations as they move toward more integrated operating models. One of the key levers in creating real connections across business units, regions, and functions is the redesign of the executive team.
It is perfectly appropriate for members of an executive team overseeing a fairly unconnected and autonomous business portfolio to come to the table as representatives of their component of the business. They roll-up and report-out results. A few strategic and holistic decisions are worked through together, but it is often clear that the CEO makes the decisions with a small kitchen cabinet. The executive team may discuss options and trade-offs, but in the background, a hub-and-spoke dynamic between the CEO and individual executives is where the real decisions are made.
Once you determine that you are running an integrated company, however, all members of the executive team have to model the enterprise-level, critical thinking that adds value across the company portfolio. Each one has to come to the table as though he or she were sitting in the CEO’s chair. When this happens the company sees a number of benefits:
- Diversity of perspective in a multi-dimensional organization with a complex strategy leads to higher quality decisions. The quality of the perspectives and the quality of the decision process are important, of course, but the first step is to get the right voices around the table.
- The behavior of the executive team sets the tone for the next layers of management. How can functional, business unit, and regional leaders be expected to model effective collaboration at their respective levels if they don’t see it above?
- Finally, with little “real work” to occupy their time at the enterprise level, executive team members inevitably dig down into their own organizations, meddling in areas best delegated to their teams. Creating a real enterprise agenda lifts up the focus of all levels of management.
Part of our design work is to set up new governance frameworks – to design the right conversations. We start with a clear purpose and outcome for each forum and establish a disciplined cadence and process for meetings. This often means redirecting time to high value/high risk work, such as enterprise strategy, transformation initiatives, business development and acquisitions, portfolio management, and innovation. When operational work is on the agenda, it should be limited to work that isn’t easily delegated down, such as serious corrective actions, problem solving, or people development.
When executive teams learn to work together we see direct and intangible benefits immediately. Practicing a test/learn/iterate process as a team accelerates decision making and execution by building trust and alignment. Destructive leadership behaviors are easier to spot and addressed earlier. Most importantly, transformation cascades into the organization, as teams begin to model the behavior they see from their leaders.