Make Your Strategy 12 Strong

I have never been a fan of comparing combat to corporate. That is the attitude I brought to the keynote speaker at a recent banking conference I attended.

His name is Mark Nutsch, a former U.S. Army captain with Green Berets Operational Detachment Alpha (ODA) 595, a unit that was one of the first special forces units to be inserted into Afghanistan after the 9/11 attacks. The exploits of ODA 595 are chronicled in the book Horse Soldiers by Doug Stanton and the movie 12 Strong starring Chris Hemsworth. 

An elite army unit inserted into Northern Afghanistan to work with a warlord to flush out Al-Qaeda militias? Yeah, just like that rough and tumble world of hammering out a strategy over lattes and planning its execution over conference calls. Does anyone die if a deadline is missed?

This is why I resist comparing whatever it is that I do to war.

Then Mark described how their best-laid plans went to hell due to changing situations on the ground, and then I started connecting the dots. In a speech to military planners in 1957, Dwight Eisenhower famously said "Plans are worthless. Planning is everything." As soon as things go wrong, your plan must change. Much of it at least.

This brought me back to another military figure, James Murphy, former Air Force fighter pilot, Bosnian War veteran, and author of Flawless Execution. In that book, Murphy described strategy development and execution using the Plan-Brief-Execute-Debrief method used by fighter pilots to plan missions.

This method emphasizes the debrief mentality when mission participants gather after execution phases (in a fighter pilots parlance, after the mission was completed) to identify what worked, what didn't, new information, changing situations, and course corrections. Murphy's firm, Afterburner Inc., would later adopt the more expansive model below.

Future Picture is a vivid description of what success would look like if the plan was executed flawlessly. In Flawless Execution, Murph used the example of "Taking out 75% of the enemy's surface-to-air missile (SAM) capability" as a Future Picture. This might be considered a Vision in corporate terms. I tend to call it the Aspiration because Vision has gotten a bad rap. Mostly as a result of bad visions that communicate nothing to those responsible for executing the strategy on what success would look like. Murphy's example is pretty clear.

Mark from the Horse Soldiers used Commander's Intent in his speech, which is much like what Murph has as Leader's Intent in the above model. Commander’s intent is a clear and concise expression of the purpose of a military operation and the desired end state, guiding subordinate leaders in decision-making and execution. Recognizing that the original Plan would be altered as situations changed and the execution is modified.

I recently told a bank CEO, about to embark on their strategic planning process, that it is disheartening when we as consultants review the in-force plan that has not been changed since it was adopted years ago. If the plan was used as intended, there would be post-it notes and changes all over it. Ok, maybe not post-it notes and dog ears, but the document would be marked up to the point of near non-recognition than when it was adopted. 

Except for the Commander's Intent, or the Future Picture, the Aspiration, or the Vision. That would not change, or it would change minimally.

So how does your financial institution create the culture to "Win" as Murph's model demonstrates? Here are 3 ideas:

1. Have a clear Commander's Intent/Future Picture/Aspiration/Vision. Whatever you call it, make it clear where your financial institution is going from the Board room to the teller line. "Be number one or number two in every market we serve" is pretty clear. Don't let the ups and downs of the current situation cause you to lose sight of your brass ring.

2. Build an execution culture. Depending on what study you read, strategies fail somewhere between 70%-90% due to poor execution. Identify those hopefully few metrics that define success in strategy execution. Assign the tasks that need to get done in order to lay the bricks that get to your strategic objectives and vision. Name names. If Marsico is Project Leader on the "implement integrated cash management" suite by December 31st, I don't want to show up to the Management strategy update (debrief) meeting with nothing to report. Imagine if I were tasked with taking out a SAM site in the Flawless Execution example above, and I said "I didn't have time because of my day job" in the mission debrief.

3. Use the debrief method to modify the plan. I tell management teams that they should meet regularly about strategy execution and to make plan modifications. If the modifications are immaterial, a term pre-agreed upon between the Board and Management team, then make the changes and inform the Board by including the immaterial plan modification in the next Board meeting package. If it's material, then propose it to the Board and make the changes after Board approval and/or modification to the proposal. Financial institutions already do this with policies. At least quarterly, brief the Board on plan execution. You may find their perspectives extremely useful in getting to "Win." They are from varied backgrounds and professions, want the institution to "Win", and you pay them anyway. What great consiglieres! 

None of these things will lead to death if done poorly or not done at all. So I still resist comparing combat to corporate. But that doesn't mean we can't learn from the military on how they plan and execute when the stakes are so high. 

For us, the stakes are not so high. But death to our institution is a real possibility. 

~ Jeff

P.S. Mark and a few of his comrades started Horse Soldiers distillery and I intend to partake in some soldier-strong bourbon!

  

Flawless Execution: Plan, Brief, Execute, Debrief

How do we connect our strategy to our vision? Can bankers identify, in high definition detail, the bank they want to become to remain relevant to their constituencies, and translate this future bank vision into action?

Regular readers of Jeff For Banks know I recently read Flawless Execution by former Air Force pilot Jim "Murph" Murphy by my post about defining your High Definition Destination. Far be it from me to send multiple shout-outs to an Air Force guy. The Navy has more planes (GO NAVY!). But, as the book's title suggests, Murph has some interesting thoughts on execution that I think can help banks bring vision to the ground floor.

Murph outlines how pilots plan for missions in a model represented in the accompanying picture. Could this work for community financial institutions? Let's walk through an example.

Suppose the FIs vision, or "high definition destination" is to be the number one business bank in the counties served for businesses with less than $10 million in revenue. The strategy team identifies a few Strategic Objectives that are critical to achieving the vision. For example, one Strategic Objective could be to develop a robust, yet simple suite of products designed to make the business persons' lives easier.

In the Flawless Execution model, a team would be assembled with all functions critical to the execution of the Strategic Objective present... commercial and retail banking, IT, compliance, marketing, etc. A plan is developed with responsibilities and timing. The team completes the game plan, and disperses to execute, re-assembling for regular updates and inter-dependencies.

After the product suite is developed and launched, per the plan, the team comes back together for a debrief to dispassionately discuss surprises, hurdles, miscues, and successes. This debrief is critical to organizational learning, ensuring the next Strategic Objective is executed better than the last. Yet, in my experience, the debrief rarely happens. 

Part of the reason is the increasing lack of candor in banking, and our society as a whole. I dedicated a blog post to this subject over three years ago, and I haven't noticed much improvement. How do we construct a culture of continuous improvement if we do not recognize execution flaws and impediments through a candid, yet dispassionate and impersonal debrief process?

Fighter pilots debrief this way because flaws in plan execution could end up in tragedy. Get better or risk death tends to add greater urgency than get better or have your FI relegated to the dust heap of irrelevance. 

But, as the numbers bear out, FIs need to get better at execution or risk irrelevance.  

How do you execute and do you debrief?

~ Jeff

Bankers: What Is Your High Definition Destination?

Future Picture: "A high-definition picture that shows in great detail the future as you want it to be." Future Picture and its definition are from James D. Murphy's ("Murph") 2006 tome, Flawless Execution. I liked it so much, I e-mailed Murph at his consulting firm, Afterburner, for permission to quote from it.

Murph and his colleague, Will Duke, called me back. Since the 2006 book, their thought process has evolved. They created a more versatile version of Future Picture, one that can be applied to multiple industries with greater precision. They termed it High Definition Destination ("HDD") in their as-yet to be released book, Courage to Execute. 

In an excerpt of the book, HDD is described as follows:

" A HDD should be so described as to provide a beacon-like objective that drives the entire organization forward.  It should be clear and simple, yet high-definition."

In other words, Future Picture, and it's successor HDD, describe in vivid detail the organization you want to be. So vivid, in fact, that all levels of the organization know it, understand it, and can describe it in less than five minutes. 

I discussed with Will and Murph our industry's vision problem. Many if not most of our banks date back many generations, in simpler times when we had one branch that did all things banking to an entire town. Competition was limited and sometimes non-existent. So our vision started as something like this... Schmidlap National Bank. We're a bank. To the town of Schmidlap. 

Now things are more complex. We are in dozens if not hundreds of communities. Our products sometimes number in the hundreds. We compete with financial institutions that are located within those communities and outside of them. We don't just compete with banks, but also with credit unions (and vice versa), insurance companies, brokerage companies, virtual banks, and non-bank financial intermediaries. 

Yet our vision has evolved to something like this: Schmidlap National Bank. We're a bank. But not just in Schmidlap.

Don't believe me? Take this vision statement from an anonymous bank that I found randomly looking through bank vision statements on the web:

"Our vision is for [bank name] to build value by employing those human, financial and technological resources which will enable and insure its expansion, prosperity, and reputation for superior quality, performance and value returned to the communities, customers, team members and investors it serves."

How about that for a High Definition Destination? There's gotta be a yadda yadda yadda in there somewhere. Does this vision statement read like yours? Even a little bit? Does your vision provide that vivid picture where all employees know your HDD and make decisions and develop tactics to achieve it?

As Murph told me on the phone call, general vision gets general execution. Executing to achieve some general HDD promotes wasted effort. And minimizing wasted effort is critical to flawless execution.

So tell me, how specific is your vision? Do you have an HDD?

~ Jeff