Business alignment is everyone rowing in the same direction at the same time to get where they want to go together. When departments and divisions across the whole company are aligned around a singular objective, they will accomplish what they set out to do. Therefore, alignment is how businesses achieve their goals.
However, alignment is far more elusive than many business leaders realize. A Harvard Business Review analysis of strategic alignment made the following discovery:
“We asked more than 500 frontline employees, middle managers, and senior executives across 12 different organizations to indicate how aligned they thought their companies were with respect to corporate strategy. And we found that the participants were largely optimistic, on average reporting that they felt strategic agreement within their companies was 82%. But when we analyzed detailed written explanations from those same employees around what their company’s strategies were, we found that actual alignment (as measured by the linguistic overlap in the concepts and words they listed) was, on average, just 23% — two to three times lower than perceived alignment.”
Of course, that begs the question, would you even know if your organization was misaligned?
What does it Look Like to be Misaligned?
Identifying misalignment requires more than a gut feeling. When an organization lacks alignment, it will manifest itself in clear ways. Signs that your organization is suffering from misalignment include:
- Flat or declining revenue.
- Disparate teams focusing only on their own objectives.
- Interdepartmental rivalry (that goes beyond healthy competition).
- High employee turnover.
- Inefficiency in operations.
- A chaotic workplace culture.
Classic examples of misaligned organizations include divisions, departments, or teams that are siloed. Siloed teams put the achievements of their group ahead of the organizational as a whole. Their separation from other areas of the company results in unhealthy competition and a self-serving desire for recognition that leads to in-fighting.
Even where misalignment is less confrontational, it can be seen rearing its head where different areas of the company are on different pages. With this type of misalignment there is a wide-reaching lack of understanding around common goals. Everyone hears something different, and they approach business goals based on their own perspective. Often, they will place their own role or team at the center of their efforts – looking at what they want or need first and allowing that to influence what they hear and remember when it comes to understanding business-wide goals.
Keys to Achieving Greater Alignment
The Harvard Business Review article on strategic business alignment summarizes the secret to achieving greater alignment by saying,
“To foster true strategic alignment, leaders must focus the entire company on driving customer value; weave that strategy into everyone’s daily work; and develop strategic priorities not in a vacuum, but through collaborative dialogue with senior executives, middle managers, and frontline employees.”
Why focus on customers instead of another objective? Simply put, because without customers you do not have a business.
Putting your customers at the forefront of your business strategy is a crucial component of uniting an organization around one singular goal. However, you need to look at business value and customers with the right lens. There is a lot of talk these days about “customer value,” that is the value that a customer creates for the business. But alignment requires thinking about “value for the customer,” that is what the business can provide to a customer to create value for them.
But it doesn’t end there. True alignment also requires everyone speaking “the same language” around their shared goal. With customers at the top of the pyramid an organization must develop a common language where they agree on word usage and definitions as they relate to business objectives and performance. The language should be clear, simple to understand, and focus on overall business goals rather than siloed goals. For example, every sales funnel is different, so being aligned requires common language related to how you classify where they are in the funnel, what you do at each stage in the funnel, your goals as you move customers to the next stage of the funnel, and how you track their progress through the funnel.
Developing a common language requires intentionality, especially at organizations with a very diverse or globally dispersed workforce that brings a lot of different personal and professional experiences to the table. This is often one of the hardest things to achieve, but taking the time to shape language around shared goals is a crucial component to becoming better aligned.
The Relationship between Leadership and Alignment
Alignment must always start at the top. However, it is important to remember that while executive leadership is the driver behind strategic alignment, they cannot create alignment themselves. Leaders create the opportunity for alignment but cannot force it downstream. Everyone must be bought-in at all levels because they understand the importance of doing so.
Leadership needs to be fully committed because alignment is not a one-and-done action – it is an ongoing set of behaviors and actions. It requires consistent transparent two-way communication – leadership asking good questions and employees on the frontlines being heard without fear of retribution. The proper communication channels need to be in place for this kind of dialogue to occur and everyone at all levels must be willing to truly listen and respond to what they are hearing.
How to Support Alignment across the Organization
Alignment does not just need vertical communication; it also needs horizontal communication. Cross-team or cross-department collaboration is essential as well. Alignment requires a lot of different voices coming together to create value for the customer. Without this, executive-driven efforts to be better aligned will fail.
Most often the “front half” and “back half” of a company will be misaligned because customer-facing teams are doing one thing while internal teams are doing another. First, members of one team all need to be aligned, then all internal teams need to be aligned and external teams all need to be aligned, and lastly there needs to a bridge between external and internal teams that align everyone’s efforts around the customer.
Understanding the Barriers to Business Alignment
Lack of transparency is typically the most common barrier standing in the way of strategic alignment. However, poor communication, territorialism, and lack of listening can also be to blame.
Privately held businesses are especially vulnerable to falling into this trap because many do not share financial information with management or employees. And while it is their right to keep this information private, sharing performance metrics is key to establishing strategic alignment. Where business leadership does not want to disclose hard numbers, they can share important ratios, percentages, and other key metrics to help employees gauge how the business is performing relative to its goals.
When your organization is misaligned or struggling to overcome alignment barriers, bring in a third-party revenue consultant to advise on where you can make improvements. An experienced fractional Chief Revenue Officer will provide the expertise and impartiality required to assess where your company is falling short of alignment around business goals and strategies and create a plan to help you become better aligned.
Greater alignment starts with that first step. Reach out to us today!