Presentation from Council of PR Firms, AW Page, FD "breakfast briefings," held in Chicago and NYC in July, 2009. Presented by Betsy Neville and Neil Bennedict, FD.
Cracking the ‘Business Process Outsourcing’ Code Main.pptx
Strategic Initiatives Summary N Y 072209
1. More than a communications partner
Corporate Strategy Study
Conducted May 2009
2. Objectives
This study examined the intersection of leadership, strategy
and communications in successfully creating and
implementing corporate strategies. Our key objectives:
●
Gain additional insight into corporate strategy, its
development and execution, and the impacts to its
success or failure
●
Understand the similarities and differences in
behaviors and attitudes toward corporate strategy of
CEOs, strategists, and communicators
●
Identify areas where these three groups can work
together to maximize their collaboration
2
3. Methodology
Online survey fielded by FD January 28-March 3, 2009
with 230 completed interviews
Of the 230 completed interviews, 90 were CEOs, 47
were senior strategy officers, and 26 were senior
communications officers
The analysis that follows is based on the sub-total of 163
completed interviews comprised of CEOs, senior strategy
officers and senior communications officers
3
5. Definition of strategy
CEOs, strategists, and communicators do not share
a common definition of what strategy is at the
conceptual level, but most agree that it has:
The ability to change a market, competitive position or
business model
5
6. What makes an initiative strategic
Respondents do not have a clear definition of what strategy is at the conceptual level, but two-thirds
agree that it “changes a market, competitive position or business model.”
CEO
100% Senior Strategy Officer
90%
80% 73% 64% 65% Senior Communications Officer
70%
58%
60%
50% 46% 45%
38% 36%
40%
27%
31% 30% 32%
30% 21% 23% 23% 23% 27%
19%
20%
10%
0%
Changes market, Cuts across Involves multi-year Exceeds $ C-Level Is visible to the
competitive functional and commitments of threshold in impact Sponsorship Board of Directors
position or organizational resources to and investment
business model boundaries markets and new
ventures
Which criteria must be met for an initiative to be considered strategic within your organization? Please select as many as three.
6
(N=163)
7. Identifying strategic initiatives
CEOs, strategists, and communicators agree that
externally focused initiatives are more strategic than
those that are not. Among the most strategic:
New market entry
Acquisitions
Business model transformation
7
8. Most strategic initiatives vs. least strategic
initiatives
Senior management has a clear definition of what strategy is not. External initiatives are
considered most strategic.
Overall CEO
Most Strategic
1. New market entry 71% 1. New market entry 69%
2. Acquisitions or divestures 63% 2. Acquisitions or divestures 64%
3. Business model transformation, 3. Business model transformation,
e.g., pricing 58% e.g., pricing 64%
4. Repositioning or rebranding 57% 4. Repositioning or rebranding 52%
5. New product launch 48% 5. New product launch 51%
6. Reorganization 47% 6. Reorganization 51%
7. Sourcing/outsourcing 30%
7. Sourcing/outsourcing 34%
8. Channel entry/exit/consolidation 29%
8. Channel entry/exit/consolidation 27%
9. Recapitalizations 24%
9. Recapitalizations 23%
10. Front office/back office 10. Downsizing/reengineering 20%
technology platform replacement 23%
11. C-Level leadership training 20%
11. Downsizing/reengineering 23% 12. Front office/back office
12. New measurement and technology platform
compensation models 23% replacement 19%
Least Strategic
Which initiatives would usually be considered strategic within your organization? Please check all that apply. (N=163)
8
9. Strategy success and failure
Respondents are generally very optimistic about the success of strategies, but
acknowledge that about one-third of initiatives fail
All three groups agree that strategic initiatives require a disciplined strategic
planning process
They also cite stakeholder commitment and anticipation of obstacles as major
success factors
CEOs, strategists and communicators say senior management is most
responsible for both the success and failure of strategic initiatives
They blame failed strategies on five common reasons, and 82 percent of
failures are preventable
9
10. Disciplined strategic planning
CEOs, strategists, and communicators all agree
that strategic initiatives require a disciplined
strategic planning process
10
11. Importance of a disciplined strategic planning
process to the success of strategic initiatives
More than 80% say disciplined strategic planning is at the very least critical to success.
(80% = combined 4 and 5 responses across all groups)
How critical is following a disciplined strategic planning process to the overall success of your strategic initiatives? (N=163)
11
12. Success factors
They also cite stakeholder commitment and
anticipation of obstacles as major success factors
12
13. Why strategic initiatives met or exceeded expectations in
terms of effort required and delivery of expected benefits
Stakeholder commitment and anticipation of obstacles are major success factors. In fact, 21% of CEOs
say the latter is the key to success.
Senior Senior
CEO Strategy Communications
Officer Officer
Correct strategy 33% 39% 33%
Understanding and commitment of stakeholders 30% 25% 31%
Anticipation of obstacles 21% 9% 11%
Upfront planning 13% 20% 19%
Other 2% 6% 5%
What was the primary reason why the strategic initiatives met or exceeded expectations in terms of effort required and delivery of
13
expected benefits? Please check all that apply. (N=163)
14. Responsibility for outcomes of strategic initiatives
CEOs, strategists, and communicators say senior
management is most responsible for both the
success and failure of strategic initiatives
14
15. Parties most responsible for failed strategic initiatives
3 out of 4 respondents (76%) said senior management should be held most accountable for failed
strategic initiatives.
Who within the organization should be held most accountable for the failure of key strategic initiatives? (N=135)
15
16. Reasons for failure
CEOs, strategists, and communicators blame
failed strategies on five common reasons, and
82 percent of failures are preventable
16
17. Why strategic initiatives fail
Strategic initiatives fail for five common reasons. But CEOs, strategists and communicators are not
completely aligned on why initiatives fail.
What was the primary reason why strategic initiatives did not meet
expectations in terms of effort required and delivery of expected
benefits? (N=135) 17
18. Major differences
Why Strategies Fail
CEOs, strategists, and communicators do not agree on
why strategic initiatives fail.
CEOs Strategists Communicators
Split the blame evenly
Most likely to indicate that among “unforeseeable
Most often blame “incorrect
failure is a result of external circumstances,”
strategy”
“unforeseeable external “lack of understanding,” and
circumstances” “other”
18
19. Cause for concluding strategy was incorrect
The greatest problem is an overestimation of market potential (58%), but incorrect economic
modeling (38%) and unanticipated competitive responses (21%) are also factors.
CEO
Senior Strategy Officer
100%
90% 75% Senior Communications Officer
80%
70%
67%
60% 46%
50%
50% 46%
40% 33%
30% 22% 22% 25%
18% 18%
20%
11% 9%
10%
0% 0%
0%
Market potential Competitive response Objectives and Incorrect assessment Unforeseen barriers to
overestimated different in magnitude success criteria not of economics uptake/switching
or direction well understood
What caused you to conclude the strategy was incorrect? Please check all that apply. (This question was only asked to those who
19
blamed failed strategic initiatives on “incorrect strategy” (N=24))
20. Why lack of understanding occurred
CEOs and strategists say the problem is communications-related, while communicators suggest their
earlier involvement in the process would have helped.
100%
CEO
90%
Senior Strategy Officer
80%
Senior Communications Officer
70% 64% 56%
60% 55%
50% 44%
40% 40%
40%
33%
30% 27%
20% 22%
18% 18%
20%
11%
0%
10%
0%
0%
Poor communications among stakeholders Misunderstandings about deadlines Poor understanding of costs
Why do you believe the lack of understanding occurred? Please check all that apply. (This question was only asked to those who
20
blamed failed strategic initiatives on “lack of understanding” (N=25))
21. Importance of communications
All three groups agree that communications is
critical to the overall success of strategic
initiatives, with 1 out of 2 respondents indicating
that communications is “extremely critical”
21
22. Importance of communications to the success of
strategic initiatives
CEOs (90%), strategists (86%) and communicators (96%) say communications is at the very least
critical to success.
How critical is communications to the overall success of your strategic
22
initiatives? (N=163)
23. Major differences
Role of Communications
CEOs, strategists, and communicators disagree on the
role of communications in strategic planning.
CEOs Strategists Communicators
Is an integral component
Acts as a resource once
of the strategic planning
Is an integral component of implementation begins
process
the strategic planning
process Acts as a sounding board
Acts as a resource once
prior to rollouts
implementation begins
23
24. Role of communications in the development and
execution of strategic initiatives
70%
CEOs (51%) and
strategists (47%) 60%
said communicators
should play an 50%
active role vs. only
39% of
communicators. 40%
And strategists
(55%) and 30%
communicators
(58%) said
20%
communications is
a resource vs. only
34% of CEOs. 10%
0%
Sounding board as Resource for strategists Integral and active Means of
Communications is not
Provides input up front soon as strategies are to use once component of the team/employee
involved in strategy
developed implemented strategies feedback
CEO 49% 42% 34% 51% 47% 9%
Senior Strategy Office 55% 49% 55% 47% 51% 9%
Senior Communications Office 50% 62% 58% 39% 62% 8%
How does the communications function contribute to the development and execution of strategic initiatives within your company?
24
Please check all that apply. (N=163)
25. Major differences continued…
Optimism Gap
An optimism gap exists among the groups regarding the success of strategies.
While CEOs and strategists put most of their initiatives at a 50% to 89% success
rate, communicators rank multiple initiatives as low as 20%.
CEOs Strategists Communicators
Business model C-level leadership Acquisitions or
Projects that most transformation training divestures
frequently met Repositioning or Reorganization Reorganization
expectations rebranding Compensation Repositioning or
New market entry rebranding
Acquisitions or Sourcing/outsourcing C-level leadership
divestures Front office/back office training
Projects that least
Sourcing/outsourcing technology platform Front office/back
frequently met
Compensation replacement office technology
expectations
Channel entry/ platform replacement
exit/consolidation Sourcing/outsourcing
25
26. Success rate of strategic initiatives completed
within the past five years
While respondents generally believe initiatives completed within the past five years were
successful, an optimism gap exists among the three groups.
Percent that met or exceeded expectations
Senior
Senior Strategy Communications
CEO Officer Officer
Business model transformation, e.g., pricing 83% 74% 78%
Repositioning or rebranding 78% 67% 81%
New market entry 78% 82% 71%
New product launch 76% 79% 72%
Front office/back office technology platform replacement 76% 53% 22%
Recapitalizations 75% 78% 67%
C-Level leadership training 73% 89% 20%
Downsizing/reengineering 69% 78% 64%
Reorganization 67% 89% 79%
Channel entry/exit/consolidation 64% 60% 67%
Sourcing/outsourcing 63% 50% 40%
Acquisitions or divestures 60% 71% 83%
New measurement and compensation models 59% 93% 56%
How have the results of strategic initiatives you’ve completed within the past five years met your expectations both in terms of
26
effort required and delivery of expected benefits? (N=163)
27. Use of communications
When asked how they will use communications as it
relates to their current strategic initiatives in this
economy, most respondents said they will utilize
both “workforce communications” and “customer
marketing communications”
27
28. How communications will be used in relation to
strategic initiatives in this economy
Communications will maintain focus on two key audiences: employees (68%) and customers (70%).
100%
CEO
90%
Senior Strategy Officer
80% 69%
73% 64%
70% 69%
70% 67% Senior Communications Officer
60%
50%
44%
38%
40% 35% 35%
30%
30% 26% 27%
19% 21% 19%
20% 14% 12%
10%
0%
Customer marketing communications Board communications Government/ Legislative outreach
How do you plan to use communications as it relates to your current strategic initiatives in this particular economic downturn?
28
(N=163)
29. Continuation of strategic agendas
A solid one-third of respondents will execute
their current strategic agendas despite the
economic downturn
29
30. Effects of the economic downturn on strategic
initiatives
A solid one-third of respondents will execute their existing plans despite the economic downturn.
Has the economic downturn caused you to change your current strategic initiatives in any way? (N=163)
30