In many companies strategy is akin to a waterfall. Senior leaders spend considerable time in each others company formulating and calculating the best way forward for their company. Once inspiration has struck, they then look to cascade this new direction down through the various layers of their company, all the way to those on the front line who often have most engagement with the customers.
As you’re reading this at Social Business News, it’s probable that you might believe there to be a better way of doing things. You might believe that social tools do a great job of allowing senior managers to engage with employees from throughout the company, thus enabling the company strategy to be formulated collectively, with this collective input making dissemination of the new direction considerably easier.
You know all of that I’m sure, but it’s always nice to have some research to back up your beliefs isn’t it? Step forward Professor Charles Galunic from INSEAD. He’s produced a new paper on how strategy is best disseminated throughout an organisation. There’s an interview with him at the end of this post, so if video is your thing feel free to head there.
The paper found that the most important people in the strategy process were the senior managers. The traditional cascade approach relies upon middle and line managers sharing and selling the strategy to their teams. The research found however that middle managers were useless at this (more of which later), and that senior managers held the key to the success. What’s more, he found that the best strategy for senior managers to adopt was to engage with staff regularly about strategy so that they’re involved in the process.
“Nobody has as much symbolic power as the general manager, as the head of that business unit. We humans are, in many ways, hierarchical. That lead figure has a lot of symbolic influence. So when that lead figure – he or she – when they come down and when they engage with employees and talk about strategy, I think it’s more likely to be believed and hopefully accepted.” Galunic said
The role of middle managers
So if middle managers are not much use in disseminating strategy, what can they help with? Well Galunic found that their primary role was very much that of the servant leader. Their best use was in providing their teams with the kind of environments within which they can best deliver on the strategy in an enjoying and fulfilling way.
“Job conditions play a large role, as you might imagine. ‘Is my task clearly specified? Do I have the resources I need to do my job?’ When people like their jobs, often they like it because it makes sense in the greater scheme of things, or the teamwork, or certainly the development and training opportunities. We found that when people are positive about these things, they’re much more likely to be embedded in the strategy, which makes sense.” Galunic said.
Obviously IBM have led the way in using social tools to engage their entire workforce in strategic decision making, but hopefully with more research like this, more companies will be encouraged to follow a similar path.