0905 The CEO Challenge Creating A Culture Of Growth, Innovation & Leadership
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Transcript of 0905 The CEO Challenge Creating A Culture Of Growth, Innovation & Leadership
Asia/Pacific Chairman’s Series on Growth
The CEO Challenge:
Developing a Culture of Growth, Innovation and Leadership
26 May, 2009
Today’s Presenters
Craig BatyGlobal VP, IT Practice
Frost & Sullivan
Sydney
Moderator:
Michael Buchholz
VP, Marketing, APAC
Frost & Sullivan
Warren ParryManaging Director
Change Track Research
Sydney
Agenda
1. Recap on poll results from the previous webcast
2. Brief overview: Where we are in the series
3. The CEO’s Challenge: Creating the Growth, Innovation and Leadership
(GIL) culture
4. What the CEO can do to develop a GIL culture?
5. Alignment of the CEO’s vision and staff
6. Best practices in the development of a GIL culture
7. Serious about growth: Next steps
Polling Responses from April APAC/J CSG
1. With regard to growth strategies, which challenges exist in your company?
Company is not in alignment on vision
0.0%
The company culture does not support fast growth
33.3%
We are great at strategy and poor at implementation
66.6%
We are great at implementation and poor at strategy
33.3%
We do not properly evaluate growth opportunities
0.0%
We have no ability to create future scenarios for strategy development
0.0%
2. How would you rate your company’s ability to generate a powerful growth strategy?Highly Successful
0.0%
Good
50.0%
Average
25.0%
Poor
25.0%
We are lost
0.0%
Polling Responses from April APAC/J CSG
3. How would you rate your company’s ability to implement a powerful growth strategy? Highly Successful
0.0%
Good
33.3%
Average
0.0%
Poor
66.6%
We are lost
0.0%
4. Looking in the rear view mirror, How would you rate your company’s historic growth performance relative to your top competitors?
The best0.0%
About the same50.0%
Somewhat worse50.0%
Significantly worse0.0%
Don't Know0.0%
Polling Responses from April APAC/J CSG
Looking forward, relative to your industries top competitors how would you rate your company’s future growth potential?The best
0.0%
About the same
100.0%
Somewhat worse
0.0%
Significantly worse
0.0%
Don't know
0.0%
The Growth Acceleration System
What is a Growth, Innovation and Leadership (GIL) Culture?
• Teamwork is Focused on Growth
• Business Units, Regional Units Cooperate to Drive Growth
• An Innovative, Dynamic, Trusting and Fun Environment
• Leaders are Humble, Team Players, and Inspirational
• Communication and Collaboration on Vision
• Visionary Leaders Who Set the Standard
• Growth is Celebrated
Developing a Growth, Innovation and Leadership Culture
• The Human Element of Success
• An Inspiring Vision: Total Shareholder Return Doesn’t Work
• Focused on Leadership Skills
• GIL Culture Sits on CEO’s Desk
• Continuing Research into GIL Culture
• The Top 10 To Do’s for GIL
• A Best Practice Case History
Specific activities performed to solve a tough business
challenge that 9 out of 10 companies are NOT performing
but SHOULD, with measurable results proving
effectiveness
Definition: What is Best Practice?
Olympic Performance
Measure and forecast the future growth potential of your company vs. the competitors
Growth Excellence Matrix: Future Growth Potential
� New York� KL
©2008 Dialect, all rights reserved
Warren ParryManaging Director
Change Track Research
Sydney
Introducing our Guest Speaker…
1 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
Creating a Culture of Growth,
Innovation and Leadership
It is not enough to state, We need to Grow or to implement processes that you want your team to follow to achieve growth. Nor is it enough to simply instruct the individuals and departments responsible for driving growth.
It is the behaviour, beliefs, and the establishment of a growth-focused culture that lead to successful growth. By establishing a culture of growth, you will ensure that all members of the organisation understand and participate in driving the organisation to be on the forefront of innovation and leadership.
Managers are struggling to identify the underlying drivers of high performance change and looking in the wrong place to find the answers.
2 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
ChangeTracking® is the result of extensive research over 9 years linking people, change and business performance
Comprehensive database built from over 280,000
individuals in more than 250 companies undergoing
change across industries, nationalities and
languages:- Government
- Financial services
- Health services
- Mining and Resources
- Manufacturing
- Engineering
- Energy Utility
- Pharmaceutical, Motoring, Sanitation, Biotech
- Telecommunications
Delivering benefit to change stakeholders:
Transformation, SAP/IT enabled change, new business strategy,
IT systems implementation, manufacturing best practice, global
post-merger integration, building an environment to foster scientific
innovation, cost management, occupational health and safety
research, emergency department performance improvement, shared
services implementation, change risk assessment, culture change
Transformation
Restructure (Reorg)
Cost management (Reorg)
IT implementation (Reorg)
Merger/Aquistion (reorg)
Shared Services (Reorg)
Culture change
Performance Improve
2%
22%
3%
15%
0%12%5%
0%
13%
7%
11%
1%
0%
9%
0%Transport
Consulting
Telecommunications
Utilities
Banking
Insurance
Government
Community services
Defence
Health Services
Manufacturing
Pharmaceutical
Resources
Oil and Gas
Communications and Media
35
19
1
22
1714
42
31
3 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
Feb Mar April May Jun July Aug Sept Oct Nov Dec Jan Feb Mar
Project preparation
Business blueprint
Final preparation
Go live and support
Continuous improvement
Off TrackDeclining
Performance and low Change
Capability
UnsustainableBetter Performance Improvement but
low Change Capability
On TrackGood Performance
Improvement and above the norm Change Capability
Groups that improve performance across times of change define the benchmarks for high performance
Performance
Our research shows 1 in 9 work groups improve their performance across times of change
With the best intentions the norm on change projects is that they typically take longer than planned and cost more – 16% of projects hit their targets– 18% average overrun on budgets – 23% average over run on schedule– 7% do not achieve scope/functionalityThe state of IT project management in UK 2002–2003, Chris Sauer and Christine Cuthbertson, University of Oxford Stage of project
High Performance
Peak Performance and high Change
Capability
4 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
What is ChangeTracking®?
Leaders implementing change need to know what actions to take that will give them the best chance of success
ChangeTracking shows leaders if their change is on track?- properly defined and resourced- are people actively engaged- will deliver required financial outcomes- in the shortest possible time - with the highest probability of success
………where change is off track,ChangeTracking shows the corrective actions that are required
Acquisition, Restructuring, ERP, Merger, Cost Reduction, Turnaround, Culture Change, CRM, Growth, BPR, New Strategy, Transformation, Downsizing…
5 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
Validated research that sits behind ChangeTrackinghas proven what drives performance improvement
Improving business
performance
Realising Business Benefits
Change Capability
Performance
Is the change on track to high performance?
Turbulence Resources Aligned Direction
Change Leadership
Work Roles
Emotional Energy
Dri
vers
Passion and Drive
Training and Capability
Vision and Direction
ManagementCommitment
Team Leadership
Risks and Roadblocks
Changes Taking Place
DisturbanceSystems and
ProcessesCommunication
Involvement
AccountabilityClu
ster
s
ChangeTracking measures the extent to which the benefits of the change program have been realised, whether or not business performance is improving or declining while change takes place, and the strength of six change Drivers
6 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
New knowledge has provided hard evidence about what is important to deliver high performance change
Change Leadership
Systems and Processes
Risk and Roadblocks
Passion and Drive
Involvement
Disturbance
Vision and Direction
Team Leadership
Communication
Training and Information
AccountabilitySource: ChangeTrack Research (R2=0.482, N=41725)
High negative High positive
Relative importance of factor in driving improvement in
business performance
7 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
Our research shows what is required to bring about a New Way of Working, changes in Culture, Values and Attitude?
> Clear direction, a positive team spirit> Clear direction, a positive team spirit
Culture change
1. Cultural Change must be linked to Company performance improvement
2. Teams must be actively involved in managing change
3. Individuals must have
something at stake
Primary drivers Secondary drivers
> Emotionally Engaged Leaders
> Strength to face the challenge
People must be actively involved in planning and implementing change in their team and willing to initiate change
Emotional agreement to the vision and high confidence and trust in the leadership
When there is a degree of personal risk and urgency because of the change
People need to understand the vision, feel valued and have clear performance objectives
People feel a degree of fear, but are not thinking of leaving
People must be confidence that the culture change program will improve company performance and need to see signs of improvement in effectiveness and cost management
Culture change
1. Cultural Change must be linked to Company performance improvement
2. Teams must be actively involved in managing change
3. Individuals must have
something at stake
Primary drivers Secondary drivers
> Emotionally Engaged Leaders
> Strength to face the challenge
People must be actively involved in planning and implementing change in their team and willing to initiate change
Emotional agreement to the vision and high confidence and trust in the leadership
When there is a degree of personal risk and urgency because of the change
People need to understand the vision, feel valued and have clear performance objectives
People feel a degree of fear, but are not thinking of leaving
People must be confident that the culture change program will improve company performance and need to see signs of improvement in effectiveness and cost management
8 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
Breaking the cost-cutting cycle
1. Co st-cutting b eg ins. In to ug h tim es manag ers
fo cus o n increasing
acco untab ility to achieve co st reductio n.
2. Co st-cutting g o es too far. Manag ers then find staff spirit
suffers, so they p lace a
g reater emp hasis o n m aking p eop le feel b etter.
3. Lead ership training , creativity and innovatio n
p rog ram s are put in
p lace.
5. The cycle o f co st-cutting b egins ag ain.
4. Acco untab ility is fo rg o tten fo r the
tim e b eing and co sts
creep up again.
9 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
Change is off track 3 months after go-live, a major IT system had been installed and not implemented - $3.8 million over budget,
1000 manual overrides on the new system…
When change is off track the impact ripples through reporting levels in different ways - here,
there is a disconnect between the Driver profile for managers and those reporting to them
Team Member
Other
Team Leader
Manager
AccountabilityChange Leadership Passion & Drive DisturbanceInvolvementVisionDirection
Communication Management Skills Feeling Valued
Aligned Direction Engagement Emotional EnergyTeam Leadership
Vision declines under leaders
Communication is OK
Management Skills are OK but not great
Accountability is low at all levels
Disturbance is too high
Case study 1:Bringing an IT implementation back on track
10 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
The large gains in cost effectiveness was achieved without a detrimental effect on service quality
60%
65%
70%
75%
80%
85%
90%
95%
2004 Q1 2004 Q2 2004 Q3 2004 Q4 2005 Q1
Act ivat ion (%)
Restorat ion (%)
Assurance (%)
Target %
$14
$10
$12
$8
$6
$0
$2
$4
$6
$8
$10
$12
$14
$16
2004 Q1 2004 Q2 2004 Q3 2004 Q4 2005 Q1
Sig nificantly
ove r b ud g et on
lab our costs
First Chang e-
Tracking Projec t
Area Volumes
ad d ed
Seco nd Chang e-
Tracking Projec t
Sig nificantly
ove r b ud g et on
lab our costs
First Chang e-
Tracking Projec t
Area Volumes
ad d ed
Seco nd Chang e-
Tracking Projec t
Cost pe r Unit o f Act ivit y (includes all labo ur and o ver head exp enses)
Service Q ua lit y Leve ls
“Without ‘hard’ data about how my people were responding to change, I would still be reacting, rather than proactively driving effective change,” Bill says. “Validated through direct and open discussions with my people, we learnt to focus on the drivers of improvement and act where it really mattered. The end result for my team was that complaints about the IT system moved off the agenda, we reduced unit costs by 25 per cent, improved customer service levels by over 10 per cent in less than six months and our people measures improved significantly.” Bill Lyon, National General Manager for telecommunications group
Case study 1:Bringing an IT implementation back on track
Financial rigour improved:
Budget back on track, taking 3.8 million out of costs and maintaining customer servicelevels
11 • © CTRE Pty. Ltd. 2009 • Presentation: Inside ChangeTracking® • 25/05/2009
FOR USE BY CTRE
Summary
Leaders need to know if their change program is on track; if change is off track what corrective actions to take
Does everyone:See the way forward and understand what is involvedHave the required resources Have clear roles and objectivesEngage and commit Have passion and drive to over come obstacles along the way!
To ensure success they need to: Have the facts - accurate measuresHave insight – know what mattersTake action – in the areas that really matter
Manage change based on understanding how to achieve high performance. To Contact ChangeTrack research: [email protected], +612 9247 6988
Companies to Watch for a GIL Culture…and Why?
• Apple
• Outsell Research
• TED
• Starbucks
• McKinsey
Generation of
Opportunities & StrategiesGenerate
Evaluation of Opportunities & Strategies
Evaluate
Implementation
of Strategies
Implement
Establishing the GIL Culture: The Growth Model
GROWTH
MODEL
Growth Workshops: Strategy Sessions to Build Teamwork and The Same Page
CEO's Growth Team Building Teamwork & A Culture of Growth Innovation & Leadership
Starting the GIL Culture Program
1) Communicate GIL through Town Hall Meetings
2) Benchmark with Top 20 Competitors
3) Benchmark Growth with Industry Average Over Time
4) Internal Growth Excellence Matrix
5) External Growth Excellence Matrix (with competitors)
6) Training on Best Practices & Growth Models
7) Invest in Growth: Budget, Workshops, Time
8) Shift Incentive to Stretch Growth Targets
9) Develop a Best Practices Perspective on Growth
10) Bring Team to Annual GIL Event
www.frost.com/gilglobalGIL GLOBAL 2009A global community focused on Growth, Innovation and Leadership
October 2009
Kuala Lumpur
October 2009
Shanghai
December 2009
Sao Paulo
May 2010
London
September 2009
Phoenix, Arizona
October 2009
Dubai
October 2009
Bangalore
Next Steps
� Request a proposal for Growth Partnership Services to support you and your team to
accelerate the growth of your company.
� Attend Frost & Sullivan Executive MindXchange best practice networking events
(http://www.frost.com/cal) to share and address strategic challenges
� Consider Conducting a 360 Degree Growth Workshop to support your long-term growth
strategy
� Join us at a Growth, Innovation and Leadership 2009: A Frost & Sullivan Global Congress
on Corporate Growth (www.frost.com/gilglobal)
� Register for the next Chairman’s Series on Growth: (http://www.frost.com/growthapac)
� Schedule a Recession Strategy Session with a Frost & Sullivan Industry consultant (email
us: [email protected])
� Schedule a One-on-One Growth Strategy Dialogue with a Frost & Sullivan Growth
Consultant (email us: [email protected])
� Register for Frost & Sullivan’s Growth Opportunity Newsletter and Growth Team
Membership e Bulletin to keep abreast of growth opportunities in your industry and best
practices in your career track. (www.frost.com)
Contact Us
If you have questions or would like further information about anything we discussed, please send your query to the email provided below and we will get back to you shortly.
Alvin Chua
Account Manager
Automotive, Transportation & Logistics
DID: +65 6890 0997
Mob: +65 9199 4566
eMail: [email protected]