Friday, November 21, 2008

A structure for future development

As I was writing the previous entry for this blog I was reminded of a situation a client asked me to involved in about two years ago.

The client had been offered an opportunity to expand its services into another geographic region and the CEO at the time proceeded to develop a proposal for this to take place, and involved the board in discussions.

Issues arose when the time came to submit the proposal. The board backed away from the idea for a number of reasons.

Looking back, with the benefit of hindsight, this organisation didnt have in place a framework or process for growth. Prior growth had been opportunistic and had taken place on an ad hoc basis, albeit successfully.

The lesson here, amongst many others, is this. Opportunities can present themselves at any moment. Without a framework to work within these opportunities can be missed or an incorrect decision made. In the case of my client, the lack of a framework to guide both the board and the CEO resulted in a split between them. The lack of a framework can lead to the board becoming mission focussed or even risk averse rather than focusing on growth and sustainability.

What might such a framework include? First of all what type of opportunities might the organisation consider? What degree of alignment is needed with strategic direction, or mission, for such an opportunity to be considered. The framework might include parameters such as geographic boundaries (or avoidance of), ethical considerations, compliance with legislation or even quality compliance, the identification of risk factors and a model for assessing risk, the decision making process, level of information required to enable a decision. These are some of the components of such a framework.

With a framework in place there is less room for reactive or ad hoc decision making. There is less opportunity for misinterpretation, nervousness by boards or even executive staff taking an inappropriate direction.

John Coxon
Taking You from Frontline Manager to CEO

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