Sustainable Execution – 10 rules for survival

July 10, 2009
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In his book, Strategy for Sustainability: A Business Manifesto, Adam Werback outlines nature’s 10 simple rules for survival and says that those rules can help business respond and lead better (“nature is far harsher than the market: if you are not sustainable, you die.”)

Here are his 10 along with how an eXtended Performance Management discipline (enabled by processes and technology) can support them:

Nature’s 10 Rules for Survival

Supported by a performance management discipline

1. Diversify across generations.

In the DEBATE about strategic objectives (especially revenue growth), build financial and operational models the include scenarios for mergers, acquisitions, and divestitures of products, customers, geography, and capabilities. Continue to optimize your models by connecting them to learning done in the DECIDE process – especially drivers, constraints, and assumptions from budgets, plans and forecasts (and actuals).

2. Adapt to the changing environment — and specialize.

Base your analysis (UNDERSTAND) on what you learn from GATHER (actuals, variances, events) as well as what you

In his book, Strategy for Sustainability: A Business Manifesto, Adam Werback outlines nature’s 10 simple rules for survival and says that those rules can help business respond and lead better (“nature is far harsher than the market: if you are not sustainable, you die.”)

Here are his 10 along with how an eXtended Performance Management discipline (enabled by processes and technology) can support them:

Nature’s 10 Rules
for Survival

Supported by a
performance management discipline

1.
Diversify across generations.

In the
DEBATE about strategic objectives (especially revenue growth), build
financial and operational models the include scenarios for mergers,
acquisitions, and divestitures of products, customers, geography, and
capabilities. Continue to
optimize your models by connecting them to learning done in the DECIDE
process – especially drivers, constraints, and assumptions from budgets,
plans and forecasts (and actuals).

2. Adapt
to the changing environment — and specialize.

Base your
analysis (UNDERSTAND) on what you learn from GATHER (actuals, variances,
events) as well as what you created in DEBATE (e.g., forecast accuracy and actual
ROI). Commit to
changes in DECIDE via enterprise planning (workforce plans, for example).

3.
Celebrate transparency. Every species knows which species will eat it and
which will not.

When you
interconnect all parts of the performance management framework to a common
business language, common data, definitions, meta-data, and master-data, and
you use performance management tools to give visibility to the organization,
you create transparency – not just for results, but also for the cause and
effect of those results as well as the reasons why you were after those
results in the first place (strategic objectives, targets, models, and
plans).

4. Plan
and execute systematically, not compartmentally. Every part of a plant
contributes to its growth.

This whole
framework is predicated on systematic planning for the enterprise: financial and operational.

5. Form
groups and protect the young. Most animals travel in flocks, gaggles, and
prides. Packs offer strength and efficacy.

Packs, or
work teams, divisions, SBUs, projects, and so on, generally live at the
intersection of a business function and a layer in the business (strategic,
operational or tactical). Have
the performance management framework honor their unique perspectives, yet
interconnect with the rest of the organization. Help “protect” the pack with the right HR KPIs.

6.
Integrate metrics. Nature brings the right information to the right place at
the right time. When a tree needs water, the leaves curl; when there is rain,
the curled leaves move more water to the root system.

Measure
the right things.

Cut out
the noise.

Focus and
align on the most material and volatile drivers of value in the business.

Turn the
data into actionable information.

7. Improve
with each cycle. Evolution is a strategy for long-term survival.

The whole
cycle fosters continuous improvement (as in the DECIDE to DEBATE example
above). Performance management
maturity comes by interlinking (in both directions) each component of the
framework.

8.
Right-size regularly, rather than downsize occasionally. If an organism grows
too big to support itself, it collapses; if it withers, it is eaten.

A part of
your continuous DEBATE is around resources (FTE, PPE, etc.) – what is the
optimal level of the workforce, of facilities, of capital, to deliver on our
strategic goals? Agree in the
DEBATE and execute via plans in the DECIDE.

9. Foster
longevity, not immediate gratification. Nature does not buy on credit and
uses resources only to the level that they can be renewed.

A balance
of short-term and long-term targets are required to execute beyond just the
quarter.

10. Waste
nothing, recycle everything. Some of the greatest opportunities in the 21st
century will be turning waste — including inefficiency and under-utilization
— into profit.

Measures
and results around efficiency, productivity, waste, utilization, and so on
are all baked-in to the performance management cycle. Benchmark yourself internally and
externally to see what’s normal and give yourself ‘exceed’ scenarios in your
forecasts to overachieve.

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