In today’s fast-moving marketplace, changes in strategy happen quickly. Leaders frequently craft a new strategy to take full advantage of the changes and opportunities they see or to overcome problems that have been hindering growth or effectiveness.
Before moving forward to execute the new strategy, leaders must also consider adjusting the existing structures that will support it.
Structures like reporting lines, critical processes, technology applications, reward systems, and performance metrics must match the new strategy.
It is just too easy for leaders to leave many of the former structures in place without thinking through the consequences of such a choice. Without the correct structures to support the new strategy, the odds are against it taking hold in the organization or making a difference.
For instance, leaders often change a sales strategy without concurrently altering the compensation system that will drive the new sales tactics. Or they craft a new product or service strategy without incorporating changes into marketing processes or technology usage that will increase the probability of success.
Strategies without the underlying structures that encourage internal acceptance and reinforce the desired outcomes leave the organization worse off. Structures are the building blocks for strategy success and need to be considered before any new strategy is executed.
Structures not to be overlooked include governance and oversight, communication channels, performance management systems, decision-making processes, training programs, scenario planning, resource allocation processes, and feedback mechanisms.
But among the many structures essential to strategy success, perhaps none is more important than the reward system that supports it. Without the appropriate rewards that align with the desired strategic outcomes, the new strategy is doomed to fail.
What gets rewarded in organizations is what gets done. Good leaders never change a strategy without ensuring that the reward and recognition scheme advances the differences they hope to see. Leaders always get what they reward.
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