What do these unconventional, yet revealing, metrics say about your initiative?
Strategic Initiatives: How Effective Are Your Project Reviews?
Ambition propels strategic initiatives forward but how much ambition has your project got? Could it have too little or even too much?
The Propelling Force
Is your organization, business unit or department on course to realize its ambitions? Will the initiatives that you are driving forward close the gap between its present performance and its future potential?
Ambition is the propelling force behind any Strategic Initiative. It gets initiatives off the ground, enables them to gain momentum and pushes them forward in spite of obstacles and set backs. But getting the right balance between ambition and confidence isn’t easy. Either too much or too little ambition could spell trouble for the success of your Strategic initiative.
Levels of Strategic Ambition
When it comes to strategy, ambition is espoused as a leadership virtue. However, there are differing degrees of strategic ambition in terms of what the organization is trying to achieve:
Pause for a moment to consider: What is the level of ambition of your initiative? Where is it to be found on the scale above? Reflect on the questions below in order to explore how ambitious your initiative really is.
- What does the initiative aim to achieve?
- Does the initiative dare to dream big?
- Will it have a major impact on the business, on customers and stakeholders?
- Will it shape the future of the business, maybe even its industry?
- Does it connect to a vision of the future that ignites people’s passions?
- Will it meet or even go beyond people’s needs and expectations?
- Is it fit for the future – not just meeting today’s needs but anticipating and even shaping future needs?
- Whose ambition is it? Is it the ambition of one person, the CEO for example, or is a widely held aspiration of the organization?
- Will it push the boundaries? Is it ground-breaking?
- Will it challenge the organization to innovate and find better solutions?
- Does it represent a new way of thinking – will it change behaviour or even culture?
- Will it be talked about / praised by others inside and outside the organization?
- Will it be held up as a model?
- Will it leave a lasting mark?
The Scale of Ambition
Organizations will have initiatives at all points on the scale. At the most ambitious end is the ‘moon shot’ with its ‘game-changing’ or transformative potential. These initiatives tend to steal the headlines, but most initiatives have more modest ambitions (e.g. a 5% improvement in efficiency or a 7% increase in revenues).
Just how much ambition there is determines how much leadership, vision, innovation and, of course, resources your strategic initiative needs.
The level of ambition can reveal much about an initiative and the strategy or vision that it aims to realize. That includes, the time horizon, the potential business impact, the level of risk or uncertainty involved and the type of leadership and innovation required. It also illuminates whether the initiative is business as usual or business unusual.
Usual & Unusual Levels of Ambition
Just how ambitious an initiative is depends on whether the initiative falls into the category ‘business as usual’ or ‘business unusual’:
Usual Ambition – The usual level of ambition would be last year plus 3%, 5% or even 10%. Such ‘business as usual’ initiatives aim to improve the everyday running of the business by sustaining and enhancing its core – that is its existing processes, products, markets and technologies. They build on the past extending its life into the short and medium term.
Unusual Ambition – Major or Massive gains tend to derive from doing something very new and very different. This involves working back from a future vision of success, seeking to transform the business through new products, technologies, business models, etc. ‘Business Unusual’ levels of ambition might be 35% of revenue will come from new products and technologies within 3-5 years. The goal might even be 10x in the case of a moon-shot. In either case, Business Unusual typically takes a longer term view – something that can be difficult for busy managers when they are under pressure to meet the quarterly target.
Some will argue that all Strategic projects or initiatives are by definition business unusual. In reality, however a strategic initiative is rarely completely ‘business as usual’ or ‘business unusual’, but can be found somewhere on the scale between the two. It may combine some elements of the past with some elements of the future (e.g. extension to an existing product range or expansion into a new but adjacent market segment).
The closer an initiative is to ‘business unusual’ the more it is likely to stretch and challenge the organization. The greater the level of risk and uncertainty that will be involved. Also, the more sophisticated its execution must be. A project that has level 7-10 ambition, needs to be managed very differently than one that has ambition at a level of 1-5 – that is if the ambition is to be realized.
Beyond Business As Usual
In looking to the future, leaders are advised to dream big – even to make their goals ‘big, hairy and audacious’1. There is growing use of terms such as: ‘Moon-shot’, ‘Blue Ocean’2, the ‘Next Bounce of the Ball’3 and ‘Inflection Point’4. Such terms are clear evidence that this is not ‘Business As Usual’, but rather something quite different.
Business Unusual is born of high levels of ambition – ambition to shape the future of the organization and even its industry. But it also entails unusually highly levels of risk. These are high stakes bets and an organization can only place a small number of them at any time. Moreover, it cannot run them the same as other more routine (business as usual) project.
- With a moon shot the chances of reaching the moon are small, smaller still is the chance of landing back safely to earth. The business books tell the stories of ‘out of this world success (e.g. Amazon, Netflix or Apple) as if we might all have the possibility of ‘walking on the moon’.
- The difference between an Inflection Point and a rallying point is the fact that when you arrive there you will most likely be on your own. Think Steve Jobs and the iPhone or Reed Hastings and streaming video (i.e. Netflix).
- Strategies that involve a ‘Blue Ocean’ require imagining a future that does not yet exist. Such ambitious strategic initiatives are based on assumptions, hypotheses and scenarios – which is a fancy way of saying educated guess work.
- The next bounce of the ball is about setting out a new trajectory for the business – taking it to where the action is going to be. But the next bounce of the ball is really a roll of the dice – a strategic gamble that may or may not pay off. An organization’s portfolio of strategic initiatives can only contain a very small number of such high stakes bets.
The greater the ambition the more risk, uncertainty and disruption it may bring.
Ambition ‘Tags’ Confidence
While strategy is fuelled by ambition, the sobering reality is that: Too many transformation projects fail. Too many change initiatives struggle, and too many strategies under-perform. This is what happens when the ambition of the strategy gets out of step with confidence in its execution.
It is easy to be confident of a strategy that has only modest ambitions – that will not challenge or stretch the organization and its people. But if confidence is high, then maybe the project is not ambitious enough. In this way, confidence and ambition are continuously playing ‘tag’ with one chasing after the other.
All too often there is a gap between strategy and execution – this is the gap between confidence and ambition. It is the ability to translate strategic ambition into a set of carefully prioritized and sequenced strategic initiatives that will be executed with rigour, agility and leadership.
More ambition is good, right?
It could be argued that nothing great was ever achieved without ambition. However, vaulted ambition can be dangerous and must be guarded against. For example, psychologists tell us that there is an innate tendency to over-estimate how much can be achieved and how quickly. This is called the planning fallacy, and it happens when we are closely involved in any strategic initiative5.
Here are 14 proven techniques to keep ambition in check:
- Start cautiously – There is always the temptation to hype-up an initiative in order to get it of the ground. However, it is very difficult to rein in ambitious goals once they have been put on paper.
- Use a transparent and robust process for defining project ambition. This includes:
- Consistent internal process by which strategic initiatives are prioritized and sequenced
- An agreed standard for building business case or calculating business impact
- Set goals more carefully:
- Break ambitious goals down into steps or mini-goals
- Build goals from the bottom up, starting with inputs and activities that will illuminate the relevant KPis
- Separate project outputs from business outcomes/impact by using the ‘chain of results‘.
- Run various scenarios – optimistic, pessimistic and most likely – before picking the most optimistic or ambitious scenario.
- Make clear the assumptions, hypotheses and dependencies upon which goals for the initiative have been set. Challenge them. Rigorously test / validate them in creative ways.
- Build-in external validation (e.g. build a rapid prototype or mock-up to gauge and test reaction).
- More planning & consultation – too many strategies are crafted in an ivory tour disconnected from the reality on the ground.
- Boost project rigor to ground your strategic initiative, incl. project scope, work plan, timeline and budget, risk management or stakeholder communication.
- Ensure there is a practical framework for execution – a clear set of steps, responsibilities, structure, etc.
- Avoid a disconnect between the people who created the strategy and those who are charged with its execution.
- Intelligent Resource Allocation & Alignment – ensure that the organization backs its aspiration with the commitment of adequate manpower and resources. Explore what could be achieved with 10% more and 10% less resources.
- Adopt an agile approach. Accept that the future is uncertain and that regardless of the level of sophistication or confidence around your plans you will have to learn as you go. Iterative (plan do review) cycles enable step-wise progress towards your project goals.
- Regular moments of truth with your team – where people can share their perceptions of the level of confidence and openly talk about hidden project risks or obstacles. This requires leaders to exhibit those behaviours that enable people to say what they are thinking even if it may not be what others want to hear (what is called Psychological Safety).
- Track progress – build in an effective feedback loop or review mechanism – when the results achieved diverge from those that are expected, act upon it fast.
Pause for a moment to reflect on the list above. Which of these techniques can you employ to ensure the right level of ambition for your initiative?
Other Ways of Looking at Ambition
Ambition means the desire for more, better, faster and best. It is not being content with the past but looking to shape the future of the organization and perhaps even its industry. There are different shades of ambition from ‘contribution’ (making a difference) to competition (winning over a competitor / challenge).
- Jim Collins, Good to Great, Harper Business, 2001
- Blue ocean strategy is ‘about creating and capturing uncontested market space, thereby making the competition irrelevant. It is based on the view that market boundaries and industry structure are not a given and can be reconstructed by the actions and beliefs of industry players’. W. Chan Kim & Renee Mauborgne, ‘Blue Ocean Strategy: How to Create Uncontested Market Space and Make Competition Irrelevant’ HBR Press, 2005.
- Ronald Cohen, The Second Bounce Of The Ball: Turning Risk Into Opportunity, Weidenfeld & Nicolson 2010
- An inflection point is ‘a time in the life of a business when its fundamentals are about to change’ or more technically ‘something that fundamentally changes the envelope of constraints in the arena within which an established organization operates.” Rita McGrath, Seeing Around Corners, Houghton Mifflin Harcourt, 2019
- Daniel Kahneman, ‘Thinking Fast and Slow’, Farrar, Straus and Giroux, 2013