A.G Lafley, the former CEO of Procter and Gamble wrote a seminal piece entitled “What only the CEO Can Do.” published first in 2009 by the Harvard Business Review. In it he outlined the unique role the business leader has in preparing and guiding the organization into the future.
“The CEO alone experiences the meaningful outside at an enterprise level and is responsible for understanding it, interpreting it, advocating for it and presenting it to enable the company to respond in a way that enables sustainable sales, profit and total shareholder return growth. That sustained growth is the CEO’s responsibility and legacy with inward focus the enemy of growth.” In my words, the business leader needs to understand their role as being the high beams for their organization. The following outlines five critical questions to ask and answer to help position your organization for sustained growth.
1. What would an outsider do?
The clearest view of you or your business comes through the eyes of others. An exercise I employ with some regularity with my clients is to ask them to role play as potential purchaser of their company. They are charged with the task of identifying a brief summary report on the company – the towering strengths which argue for acquiring the company and also the key challenges and concerns which could be either deal breakers or which would markedly reduce the attractiveness of the deal. The exercise helps to create a view of the organization which markedly reduces the amount of internal fog promoting a stronger focus on both strengths and challenges in the development of the forward plan.
2. What does not fit?
Look at your business products, services and customer base. Each may be attractive individually (Note! If you haven’t a good understanding of your returns by product, service or customer…you must. I’ve seen profits double and margin triple in businesses merely through better understanding and acting on where the money is made or lost) but do they create value collectively? Do they make sense together and create value beyond the individual pieces?
3. Where’s the money?
There are really only two parts to a planning process. This question is the first. The second relates to execution which of course is “How can we get it?”. Although simple, this question forces a deep inspection of markets, growth trends, competition and regulatory environment to name a few. It also considers the impact of business models past and future. Many a business and leader would have been well served to delve deeply into this question prior to committing to plan and action.
4. Is our organization resourced to deliver the plan?
This answer to this question could well be delivered through the role playing exercise I noted earlier. It is one thing to dream of a new or altered path to the future. It is quite another to recognize that you may not have the internal wherewithal to get there. One of the most difficult discussions I have with business owners is focused around the capabilities (or lack thereof) of their infrastructure and people. Often, it takes an outside view to put the microscope on the organization and to identify the changes needed or skills added to deliver a different future. Larger firms also struggle to see their internal challenges clearly. Many in search of growth, fight the bureaucracy and strength of inertia protecting the status quo. One way to deal with this is to ask a corollary question. Ask yourself what your business would look like if you could design it from scratch.
5. Can we copy someone?
The old saying that there’s nothing new under the sun is true. As Lafley observed, your role as leader is to scour the external environment at an enterprise level for opportunities and trends which your organization can capture for sustained growth. Too often leaders focus on “like” businesses or markets. I see this phenomenon often when discussing the value of peer mentorship. Statements like “They aren’t close enough to my business to help me” turn quickly when they realize in group sessions that all businesses have a common set of challenges. There is tremendous value in understanding business and markets which at first glance seem unrelated. Having a business model to follow trumps going it alone every time. A side benefit is that often, the path is much easier for the organization to follow if there is an example that brings the future to life.
While these questions are by no means, an exclusive list, they should help you and your organization to see more clearly and thereby improve your odds of meeting the ultimate goal of sustainable growth.