Accelerating Strategy Into Action

In 2006, the Strategic Planning and Process Improvement group at Connecticut Light & Power (CL&P), with the support of Schaffer Consulting (an external consultancy), set out to change the way the company developed and acted on its strategy. Their aim was to ensure that this annual activity had a more immediate and meaningful impact on the business. Like most executive teams, CL&P’s leadership regarded strategic planning as vital and had dedicated significant resources to the effort in the past. Yet, despite all the work sessions, sophisticated frameworks, and tools brought to bear, the process remained disconnected from the company’s operations and, therefore, all too theoretical.

Many companies find themselves in similar straits. Even the best analyses and plans, when they are not tested and refreshed in an ongoing, dynamic way, will wind up off course. In order to realize the most value, internal consultants need to combine the planning process with rapid-cycle implementation. In so doing, they will test and improve the quality of the company’s strategic direction, while driving immediate and tangible results.

Bob Howard headed up the Strategic Planning and Process Improvement group at CL&P. To make sure the 2007 plan would lead to action and meaningful improvement, he partnered with Schaffer Consulting to design a strategic execution process that included the following crucial elements:
• Involvement of people at all levels of the organization
• Clear expectations and accountability for achieving specific results in key strategic areas
• Empowerment of project teams to set measurable improvement goals and create work plans
• 100-day implementation time frames to require innovation and deliver results

This revamped process has contributed to CL&P in a number of ways. Employees have pioneered new ways of working and managing, delivering results that impact the bottom and top lines. Key insights have sharpened strategic focus. As employees have become engaged in company strategy, they’ve developed their capabilities and new talent has been identified.
Inclusive Strategy Development.

The first step was to get some agreement on what was truly important to the organization. Howard’s strategy consultants [I’ll use the word “consultants” to refer to both the internal strategic planning group and Schaffer Consulting] held offsite meetings to engage officers, functional leaders, and groups of managers in discussions of what future success might look like for Connecticut’s largest electric and gas utility. With some effort, the groups achieved alignment, eventually whittling forty improvement areas down to six strategic priorities, including Growth (revenues), Safety (of employees and the public), and Reliability (minimizing service outages). Senior management resolved to launch projects to make immediate progress against these priorities and to staff them with employees from throughout the organization. This emphasis on involving people at all levels of the business may feel counterintuitive, especially to management consultants. It is hard enough getting a small leadership team heading in the same direction; why on earth would one want to broaden the number of parties involved? The answer is that, in most companies, strategy is something that is disconnected from the daily experience of most people. Employees may perceive a strategic plan as an irrelevant document created by a small group of leaders or consultants; strategy is an activity that is happening “somewhere else” in the business. As a consequence, employees’ day-to-day efforts are not grounded in the most important  issues  facing  the  organization.

In most companies, strategy is something that is disconnected from the daily experience of employees.  As a consequence, their day-to-day efforts are not grounded in the most important issues facing the organization.

The approach was not to invite everyone into the room to set the strategic direction. This would, indeed, have been counterproductive. Instead, CL&P built a strategy development process that takes place on multiple levels, linking strategic priorities identified by leadership to specific projects where managers and front-line employees set goals and determine how to achieve them. These projects, in turn, generate results and insights that provide valuable input into the strategic  issues  facing  the  organization.

Expectations and Accountability

At CL&P, the strategic execution process was owned and driven by Ray Necci, President and Chief Operating Officer. It was Necci’s leadership that spurred the various levels of management to align around the company’s strategic priorities. With the support of the strategic planning group, Necci and his Officers identified a sponsor for each of these priorities. They then set specific expectations with each sponsor, thereby creating a first layer of accountability. The sponsor was responsible for “moving the needle”—making tangible progress (i.e. quantifiable results) over the course of the year. This senior-level ownership is critical to successfully blending strategy development and execution. Internal consultants cannot make this shift independently, since they are typically limited in their authority to issue marching orders for implementation. Consultants should help leadership both to be explicit in communicating the clear demand for results and to follow-up to monitor progress and assess achievement. There is a significant role for internal consultants in designing and leading the process; however, it is only top management’s specific expectation-setting that will compel true commitment on the part of employees. In its absence, consultants find themselves in the precarious position of trying to engage a workforce that is neither enthusiastic about nor takes responsibility for experimenting with new ways of generating results.

Even the best analyses and plans, when they are not tested and refreshed in an ongoing, dynamic way, will wind up off course.

 Once the initial demands had been made, the sponsor for each strategic priority worked with the consultants to think through and identify specific areas where teams might make a meaningful impact in 100 days. In this article, I’ll reference the experience of the “Reliability” priority to illustrate the strategic execution process in action. Reliability’s sponsor was Bob Dobson, CL&P’s Director of Asset Management. The potential scope of improvement opportunities pertaining to power outages was extremely broad. Dobson chose to focus on reducing the duration of power outages (the average number of minutes a customer is without power during an outage), reasoning that this area offered the greatest opportunity to generate both customer-focused results and learning, with minimal investment. Similar scoping efforts  were  undertaken  by  each  sponsor. At the same time, the strategic planning group brought the sponsors together to select people for the cross-functional teams that would be asked to achieve the results. As Director-level functional leaders, they were the perfect group to identify employees who would be able to contribute relevant expertise as well as enthusiasm for achieving the objectives. Most important was the selection of a team lead. Dobson asked Rod Kalbfleisch, at the time a Manager of Distribution Engineering & Design, to lead the team focused on reducing outage duration. Although Kalbfleisch could not accomplish the goal on his own, he had clear responsibility for moving the effort forward and was accountable for the team’s results.  This single point of ownership was critical to maintaining accountability.

Team Empowerment

In preparation for the launch of the projects, the sponsors and team leads gathered background information to help each team understand the opportunities and obstacles related to its challenge. For the Reliability team, this meant preparing data that showed the various causes of delays in outage restoration.  In addition, each sponsor, with the assistance of the consultants, wrote  a memo to the team that set the business context, explained the urgency of the need for progress at CL&P, established boundaries,  and  set  expectations  for  results.

These challenges issued by the sponsors to the teams reflect a key shift from traditional methods of strategic planning. Typically, when strategic plans make their way down in an organization (a rare event in some companies), they mandate specific steps to be implemented. In contrast, CL&P’s approach asked the sponsor to set boundaries for the project and clear expectations for results but stopped short of determining the actual goal and how to best achieve it—these decisions were left for the team.

Tap the knowledge and experiences of the people closest to the work, and enable them to turn their ideas into action. The resulting solutions and work plans naturally take into account the capabilities and readiness of the organization to make changes—a major obstacle when solutions are proposed from a distance.

The intention was to tap the knowledge and experiences of the people closest to the work, and enable them to turn their ideas into action. The resulting solutions and work plans would naturally take into account the capabilities and readiness of the organization to make changes—a major obstacle when solutions are proposed from a distance. Furthermore, empowered employees take on a strong sense of ownership and accountability. It is their plan, so the level of buy-in and commitment to implementation is high.

Tangible Results in 100 Days

After the preparations were finalized, Bob Howard brought the teams together for a joint launch session that was kicked off by Necci and his leadership team. The President shared his vision for the organization and explained how these teams were critical to CL&P’s strategy development and implementation. He and his Vice-Presidents made clear that they expected tangible results in 100 days and laid out a process with specific dates for reviewing progress during that period. This combination of urgent business need, accelerated time frame and expectation of real results helped create a sense of urgency and excitement. With support from the consultants, the teams then met to discuss the challenges, knowing they needed to quickly make decisions about where to focus and get into action. Challenged to reduce outage duration in 100 days, Kalbfleisch and the Reliability team generated a long list of possible actions to take. They struggled, realizing that they did not have the bandwidth to tackle all of the potential areas at once. In search of a big issue to target, they reviewed the reliability data that had been compiled. The numbers were puzzling—none of the issues had an outsized impact on outage duration. Only after further discussion and analysis did they discover a key fact: while the company had a short average restoration time most days, the time ballooned 20 days each year when the organization failed to maintain control during mid-sized storms. These 20 days drastically impaired CL&P’s performance for the year. With help from the consultants, the team changed its focus from, how do we fix particular problems to how do we more effectively manage these types of storms? The team set a goal of minimizing average restoration time every single day for a month. They reasoned that this would be both a valuable result for CL&P customers and test the effectiveness of the solutions they would implement to maintain control during mid-sized storms.

After creating an initial work plan, the team set out to learn more and experiment with the changes needed to achieve the goal. They created tools to track outage response, improve communications, and enable better decision-making and coordination of field work. At the end of 100 days, the team had demonstrably exceeded their goal. The other teams at the launch also committed to quantifiable results. Goals included revenue growth in a new business area, productivity increases, and improved regulatory compliance. It wasn’t easy—it was a big shift for the teams to accept that the ultimate objective needed to be actual performance improvement as opposed to, for example, the redesign of a process. Letting the teams set their own goals, as well as the emphasis on tangible results helped strengthen accountability. The teams had committed and, when reporting time came, everyone was able to clearly say whether the goal had been met.

The focus on achieving meaningful organizational results proved more satisfying to the employees involved. Contrast this with teams that create a set of recommendations that will, if approved, hopefully be implemented at some later date

 The 100-day timeframe not only delivered results quickly but also enabled rapid testing to see if the company was on the right track strategically. Leadership received the information required to make course-corrections,  as  needed,  including  alteration
of the longer-term strategic plan.  Pushing the teams to be aggressive in their goal-setting further stimulated innovation and experimentation, leading to new ways of  working  across  and  within  functions.

The Strategic Planning and Process Improvement group, with help from Schaffer Consulting, provided assistance to the teams and sponsors throughout the implementation period. This included developmental support for the people leading and executing the projects— building their capability to achieve results during the 100 days and beyond. Structured reviews with management helped reinforce accountability and keep the teams on track. The 100-day endpoint meeting turned out to be equal parts assessment and  celebration  of  the  teams’  successes.

Despite the challenges, the focus on meaningful organizational results also proved more satisfying to the employees involved–achieving their goals offered a sense of real accomplishment. Contrast this with teams that create a set of recommendations that will, if approved, hopefully be implemented at some later date.

Bob Howard reflects on the process: “Blending strategy development and implementation has been a powerful way for my group to make an impact at CL&P. It has engaged employees across the organization in delivering real results, as measured by higher revenues, increased productivity, lower costs, and more timely service delivery. As we have iterated the process, we have learned about and adjusted our strategies, sharpening the company’s overall direction.”

Over time, CL&P’s Strategic Planning and Process Improvement group and Schaffer Consulting made adjustments to the strategic execution process. New supporting mechanisms were put in place with each successive round of projects, reinforcing accountability and increasing the engagement of leadership. Over time, CL&P’s Strategic Planning and Process Improvement group and Schaffer Consulting made adjustments to the strategic execution process. New supporting mechanisms were that surfaced, for example, by providing facilitation and meeting management training.

Moving to a strategic execution process has strengthened the value added by CL&P’s internal consultants. Not only has the connection between strategy and operations been strengthened but senior executives also see a greater link between the group’s services and achieving their goals.