Don’t cascade your strategy, but let teams self-align

Imagine you have just articulated your new shiny strategy. The only thing left to do is to ‘cascade’ it to the teams for execution, right? Guess again…

Cascading means going from the top to the bottom — like a waterfall that flows in one direction. Traditionally, this looks like executives sending the finished strategy down to middle management. They are tasked with communicating it and holding teams accountable for execution.

This top-down approach definitely creates alignment. But it promotes compliance rather than commitment, while reducing autonomy, ownership and adaptivity.

In a high alignment, low autonomy culture, you run the risk that people will follow the orders, create the directed output as specified, but don’t use their full thinking power to come up with innovative solutions to emerging challenges.

Some of the world’s fastest, most innovative companies are built on a high alignment, high autonomy culture—aligned autonomy. Leaders clarify the problems to solve, but people and teams have the freedom to self-organize and have the authority to decide what to do, how they work, and how to contribute to the strategy based on their expertise and responsibility.

Drawing by Henrik Kniberg, former agile coach at Spotify. Used with permission.

To foster aligned autonomy, you must first, give people a voice and a role in shaping the strategy, and second, let them decide how they can best contribute to the desired outcomes (through self-alignment). Here’s how.

Improve strategy execution by letting people shape it

When your leadership team has aligned on an initial strategy, invite your teams to provide feedback and shape it further. Doing so drastically increases the odds that the strategy can be realized.

By involving the people who do the work in executing your strategy, you can adjust it to the realities, needs and concerns that only they know about. When people have an opportunity to shape strategy, they will develop a sense of ownership over it, and feel more excited about it than they would with a strategy that is developed behind closed doors. This is especially true when a strategy contains radically new ideas.

Ask them whether your strategy is understandable, and how it influences their day-to-day work and decisions. You’ll quickly discover whether the strategy is misguided, and whether it will actually focus the organization’s energy in the desired direction. Let their feedback shape the next iteration.

Opening up further

When only a small group of leaders is involved in strategy making, you run the risk of groupthink or creating a strategy that’s blind to potentially disruptive market developments. By involving more people, you reduce this risk.

If you’d like to involve thousands of people from across, and even from outside the organization, to help you shape your strategy, take a look at the book Open Strategy, in which they describe various methods for harnessing the wisdom of crowds, including:

• Strategy competitions: open contests to surface and develop new ideas.

• Prediction markets: gain insight by letting crowds bet on the likelihood of future events.

• Nightmare competitor challenges: to develop scenarios of how your business could be disrupted.

Let people align themselves to the strategy

When you are ready to align the objectives of the rest of the organization with the new strategy, invite the teams to align themselves. Yes, you read that right. The only way for a team to be both autonomous and aligned is for people to align themselves.

Here’s how to do it: Ask every team in the organization (including your leadership team) to articulate their Strategic Intent and trade-offs based on the overarching strategy. Ask them: “What is your role in the renewed strategy? Given the strategy and your team’s reason for existence, customer focus, or domain of ownership, what is your Strategic Intent, and how will you prioritize?”

Here’s a way they could answer that question:

The organization’s strategy is X, and our part in that is Y.

To maximize our contribution toward the wider strategy, we are going to… [team’s Strategic Intent].

And to maximize our ability to deliver our part, we apply the following trade-offs for our next quarter… [team’s Even-Over statements].

An example

Let’s put self-alignment into practice using the example of a hospital. One of their Strategic Intent statements is “Hire 500 healthcare professionals to keep up with the influx of new patients”

Example 1: IT
As a result of this intent, the hospital’s IT department may identify that their staff will have trouble keeping up with the hiring speed, and that they need to change their approach to onboarding. So they could self-align by stating:

In the following year, we are going to:

Automate provisioning so that new hires have a working laptop within 24 hours of starting.

In the next 90 days, we apply the following trade-offs:

1. Laptops even over Phones

2. Saying ‘not now’ even over Accepting new priorities

With these trade-offs, the team will focus on laptops first; phone provisioning may still be manual (rather than an automated process). In addition, they stated the desire to stop pleasing everyone by saying “yes” to everything so that they could put the focus on this initiative.

Example 2: Facilities
The hospital’s facilities management team might choose to self-align to another over-arching Strategic Intent statement that the hospital picked: “Offer all new hires and current employees a house at below-market rate.” Here is how they would self-align:

In the next two to three years, we are going to:

Acquire apartments to host 1,000 people from all walks of life.

In the next 90 days, we apply the following trade-offs:

1. Speed even over Cost

2. Volume even over Diversity

The trade-offs imply that they want to go fast and acquire a large number of units in the first quarter. To do so, they accept that they may not get a good deal on these. They also accept that their first set of units will all look the same, even though in the long term, they need a diverse set of houses for people ‘from all walks of life’.

Why self-alignment?

When strategic dialogue happens at every level of the organization, and people can shape and discuss it, they are more likely to take ownership of their part in the strategy, and take the initiative when making decisions to execute it. The greater transparency, the better: let teams publish their Strategic Intent where everyone can access it.

When you see each team’s Strategic Intent, think of these as a ‘network’ of initiatives that feed into one another, and don’t try to make them all fit together perfectly.

If you come across an unexpected diversion, resist the desire to tell them to change their strategy to fit your own ideas of what it should be. Trust that the team knows best and that they’ll adjust if it doesn’t work.

Of course, you can challenge them, but start by being curious about why they see it differently. Ask clarifying questions before reacting, and inspect your own ‘range of tolerance’. By being curious, you may discover a gap in people’s understanding of the overarching strategy, which you can then clarify. It’s the dialogue that matters.

This newsletter contains excerpts from my new book Unblock: Clear the Way for Results and Develop a Thriving Organization. It’s available on Amazon, Managementboek, Audible and Spotify.

That’s it for now!