Reigniting LeadershipFriday, October 21, 2016
Most companies that have pioneered an industry eventually face the moment when they need to look at their business with fresh eyes. Are the qualities that made them great the same ones that will drive future success? How has the world changed since they burst onto the scene? What do they need to do differently to continue to lead?
“Over the last five years, the business had produced volatile, and relatively stagnant, revenue.”
These are some of the questions that our client asked in 2014 when he took over a global business unit that had been one of the early developers of energy storage technologies. With over 23 years in the industry and nine years at the parent organization, he saw enormous potential for the business as well as fundamental challenges. Energy storage was a rapidly evolving space, and customers were looking for innovative partnerships to help them design the future of personal electronics, automobiles, tools, data centers, power plants, and more. But over the last five years, the business had produced volatile, and relatively stagnant, revenue. Customers looked to the business for low prices, but not to help them innovate. And overall, the business unit wasn’t helping to drive the growth of the parent company, which raised internal questions around its long-term value to the larger organization.
The Pioneer’s Dilemma
The business was stuck—not because of a single bad decision or tactic, but due to the gradual loss of focus over time. It faced a pioneer’s dilemma: early success created opportunities, and in the process of pursuing them, the business grew by trying to be everything to everybody. Over the years, they added product lines and expanded into new markets. This produced short-term wins, but it also introduced complexity. As the industry evolved and manufacturing and supply chains grew more complex, key business data became more difficult to analyze. When our client stepped into the top role at the business unit, he saw that smaller decisions—which informed bigger decisions—were being made with incomplete or approximated information.
Our client and his executive team agreed that what the organization needed most was focus. Instead of becoming the biggest player or the cheapest provider, this meant identifying the areas where they could be the best—and approaching those opportunities with relentless focus. From a product standpoint, there needed to be fewer product lines that strategically targeted key markets. From a technology standpoint, they needed a long-term vision and a roadmap that could inform the entire organization. And most important, they had to become more customer-focused so the business could innovate strategically to satisfy their key customers’ value propositions. By embracing the discipline of focus, the goal was to go from underserving a large group of customers to driving growth by strategically partnering with a smaller set of higher-value ones.
“Instead of becoming the biggest player or the cheapest provider, this meant identifying the areas where they could be the best—and approaching those opportunities with relentless focus.”
Our client and his executive team had crafted a strategy to refocus the organization. Brimstone Consulting Group began working with these top leaders to help them drive this strategy—by deepening their alignment and helping them come together as a high-performing team. By mid-2015, the business was gaining momentum—a result of the strategy and the top leaders’ ability to execute on it. But they knew that for the business to truly transform, they needed to re-ignite the next layer of leaders and turn them into owners and drivers of change.
The BAT Process
At the core of Brimstone’s approach is the belief that learning by doing accelerates the growth of leaders. Brimstone worked closely with the executive team to identify the areas where the next layer of leaders could drive change. The result was a process that organized 32 leaders into four Business Acceleration Teams—which they internally named “The BAT Process.” Each team defined a charter based on a component of the strategy: becoming more customer-centric to better meet the needs of those in the high-value spaces they served; defining a technology roadmap that incorporated thinking from across the organization; innovating new approaches for improving a strategic product line; and rethinking talent management to better engage, incent, and develop people.
For nine months, leaders came together in these four groups to advance the different strategic imperatives. While our client owned the process and regularly reviewed progress, it was the broader group of leaders that drove the action.
The BAT Process resembled other initiative-based efforts our client had led, but this effort was different in that BAT teams were fully empowered to make decisions. The teams not only solved problems—with coaching from Brimstone and the executive team sponsors, they also developed the leadership skills required to simultaneously transform the organization and deliver business results. While the four teams each took on very different types of challenges, across the board there were several shifts in the way leaders learned to approach their work—shifts that represented dramatic and positive departures from the past.
“The teams not only solved problems…they also developed the leadership skills required to simultaneously transform the organization and deliver business results.”
One significant change involved becoming a culture of possibility. Over the years, the leaders in the organization had become experts on identifying what couldn’t be done. The tendency was to discuss a new idea, identify its potential pitfalls, and then continue with the old way of doing things. One of the books that Brimstone introduced to the executive team was Ram Charan’s The Attacker’s Advantage, which explains how leading through uncertainty requires letting go of historic constraints in order to get out ahead and attack a space. By reading the book concurrently, the executive team adopted shared language and constructs for evaluating new ideas. They demonstrated this new way of thinking during regular reviews of the BAT Process—building on and evolving the teams’ ideas rather than deconstructing them—which helped teams see the power of identifying possibilities rather than flaws.
Another change involved breaking down internal silos. The technology roadmap team was one that started off not really understanding why such a diverse group had been assembled to address this track of work. But as people from different functions discussed the impact that the roadmap had on their groups, the ripple effect that technology decisions produced throughout the organization became more apparent—as well as the need to share the management of the technology roadmap going forward.
“As their decisions started to pay off, they saw a direct relationship between operating with a no-excuses mindset and their improved standing in the larger organization.”
A subtle but powerful change took place in how the business unit viewed its accountability. Stagnant revenue had reduced the parent organization’s appetite to make large bets on the business unit. The BAT process was one of empowerment. It engaged a broad set of leaders across the business to define the actions they could take to accelerate the progress of the strategy. As their decisions started to pay off, they saw a direct relationship between operating with a no-excuses mindset and their improved standing in the larger organization.
A shift also took place as a result of “fishbowl meetings.” In these meetings, the BAT team members presented recommendations to the executive team and then remained in the room to observe the decision-making process. A member of the BAT team sat at the table with the executive team to answer questions, and one chair remained empty in the event a team member wanted to provide input, but the objective of this meeting was for the larger team to understand the thinking the executive team employed in order to debate and come to decisions about what to do or not do. This simple but powerful process illustrated how the top team reached alignment. They didn’t always agree, but when they arrived at a decision, they would unanimously support it. The process also illustrated that the executive team didn’t have all the answers—they needed input and involvement from the team to reach the best decisions.
While the teams were practicing new ways of working together, they ran into different sets of challenges. On an individual level, not all of the leaders were able to make the transition to the new vision for the organization, and some left the business. This is not uncommon in a change effort—but an important outcome that can get overlooked is how much acceleration teams realized when the people resisting change stepped aside.
At the team level, groups made progress very differently through the BAT Process. For some teams, it wasn’t until the final months of the work that they were able to achieve the level of alignment, collaboration, and understanding of their challenge that would inspire breakthroughs.
A common challenge was getting tactical too quickly when a problem surfaced. As teams identified opportunities for quick wins, their instinct was to instantly address the opportunity. What they started to practice was focusing on the opportunities they were best suited to impact, and those that would drive business results. For example, the product innovation team used a statistical analysis approach to identify a number of incremental improvements that would drive down costs and improve the value equation. While these ideas were valuable, the charter of the group was to paint the vision for a path forward that would help the business realize opportunities for years to come. By staying focused on the bigger topic, the team was able to fold the incremental improvements into a strategic framework that would maximize their impact.
“At the beginning, teams needed to practice going slowly in order to move fast later.”
Another challenge for the teams was learning to embrace the diverse skills and perspectives of their members. Not everyone had the same technical skills. People had different insights into customer needs, operational issues, and business drivers. Not everyone had worked together before. So, at the beginning, teams needed to practice going slowly in order to move fast later. This involved breaking the work down into smaller buckets that allowed them to explore different perspectives without sidetracking the entire team’s progress. A significant result of creating space for diverse thinking was that it helped the team to better understand and appreciate each other’s expertise. It also enabled them to accelerate at the end of the BAT Process—because they had built the trust that allowed them to move fast when they needed to.
One of the more difficult challenges to overcome was a not-invented-here mentality. As a pioneer in the industry, people trusted their personal experiences and instincts, sometimes to a fault. The BAT team that focused on customers was so confident they knew the issues and answers that they didn’t challenge their initial assumptions. Six months into the process, they ran into walls and had to backtrack out of months of work to rethink some established processes around customer engagement. Once they did this, it unlocked a number of breakthrough ideas that got the team back on track.
Over nine months, the BAT Process directly and indirectly drove a number of positive results for the organization. The most significant was the engagement of 32 executives in developing their leadership capabilities. Their growth accelerated the organization’s ability to execute on its strategy and deliver results—outcomes that exceeded the expectations they had set with stakeholders. As important, the process deepened the bench of leaders, and elevated the conversations around what it meant to be a leader in the culture.
“The product-line-improvement track of work broke production records by increasing production by nearly 30%.”
The BAT Process also contributed to better results in specific areas. The product-line-improvement track of work broke production records by increasing production by nearly 30%. It reduced short-term costs, and helped the organization better understand the cost structure of an integrated set of production processes and how they could be optimized in the long term.
The technology roadmap track of work helped identify how the business should focus its R&D and innovation efforts. Universities and large companies are spending billions to explore the future of energy storage. To drive meaningful innovation, this BAT team developed a collaboration model to strategically engage customers in the process. In the 12 months following the BAT Process, the organization entered into two collaboration agreements with customers to explore novel technologies. More positive results are expected in the coming years as the innovation process leads to the commercialization phase for new products.
The customer-centricity track gave the organization deeper insight into what customers needed, and how to prioritize customers based on the organization’s new focus. Even more important was the development of a cross-functional sales effort that helped the business unit to consider customer needs in all business decisions. Since the BAT Process, sales have increased with strategic customers in key product lines, and on-time shipments have steadily improved.
The talent management track put in place a leadership development program that provided a new level of support to help employees identify and pursue their potential in the organization. Since the BAT Process, employee engagement scores improved across the business. The clarity that the BAT Process created—being able to better explain the business, its mission, and the change being driven at the operational level—has enhanced the business unit’s reputation and helped it attract talent internally (from other business units within the enterprise) as well as externally.
“A leader had sent three members of his team to participate in the process, and when they returned to their site, they kicked off their own BAT Process.”
Success for Brimstone has always been defined as transferring skills and knowledge to leaders so they can drive change on their own, so perhaps the most significant result happened after the BAT Process work was completed. A leader had sent three members of his team to participate in the process, and when they returned to their site, they kicked off their own BAT Process. Using the same tools and processes—but without Brimstone’s support—they aligned 45 leaders around initiatives that are already helping to improve business results and drive down costs, with the benefits expected to become more evident over the next two years.
At a higher level, the work our client led in his business unit created believers in the parent organization. New conversations have emerged throughout the enterprise about the business value that leaders can create by empowering the next level of leaders to drive change and fostering a culture of ownership and accountability.