Function Strategy Sprint — esther steiner

Financial Services Group, 58k employees

“Help us create awareness of strategic contexts within our functional leadership cohort. Enable leaders to prioritise work where they have the most impact, and collaborate more effectively, within and beyond their function and business units.”

Approach

Diagnose the current state of design leadership within the function
Familiarise leaders with the Design Competence Framework (Baars, 2016)
Identify barriers and opportunities for design leadership across the group
Articulate a future vision and ways-of-working across business units and beyond the function
Identify individual actions to work towards change
Cement design leadership competences and facilitate collective learning

Functional Strategy

I helped the team of around 25 design leaders articulate a functional strategy. As its North Star (roof tier on the strategy house) it has the groups purpose and strategic direction. The tier below articulates strategic objectives that the design function would deliver to contribute and enable the group’s North Star. It leverages the capabilities and unique skills of the design leadership team to deliver incremental and latent value. The bottom tier addresses the enablers that need to be in place to achieve the strategic objectives, i.e. collaboration, ways-of-working, culture, systems and resources.

The group had set key behaviours and cultural values that are reflected in the strategy for this design function. The result is a strategy that is fully aligned to the group’s purpose, cultural values and ways-of-working, while fully leveraging the function’s key capabilities.

Barriers & Opportunities for Design Leadership

This client is a big financial services group with complex stakeholder relationships comprised of different business units, functions, and a myriad of horizontal programmes. Furthermore the group underwent a major shift, reorganisation and transformation at the time. Part of this engagement was to help the leadership team reconcile group interests with functional interests, and bridge the ambiguous space between them. It was paramount to identify the scope of impact the function could have on the wider organisation. The identified barriers resulted in well managed expectations, while the revealed opportunities allowed to focus leaders on the right things where they could have most impact and deliver value to the organisation.

Defined actions, behaviours & routines

A strategy sprint isn’t useful unless the resulting plan is implemented. The strategy provided a decision-making framework to identify and prioritise actions. I helped the team create a long list of actions using the Design Competency Framework (Baars, 2016), and the group’s behaviours as per their culture statement. This produced a list of actions that considered:

the group’s culture, behaviours and ways-of-working
the group’s overall strategy and purpose
the operating scope of the function and how it can maximise value within it
the key capabilities of the function and how it creates value

The prioritised actions where individually assigned and deadlines set within a 90-day timeframe. Leaders were kept accountable throughout the sprint to deliver on actions, as well as via weekly leadership team meetings and monthly get-togethers.

Keywords: strategy, function strategy, design leadership, design management, stakeholder alignment, ambiguity, change, facilitation, sprints

Why Functional Strategies?

First, a bit of terminology: A corporate function provides a service that is used across an organisation – think HR, R&D, Legal, Finance etc. A function’s strategy should be closely aligned with the corporate strategy, however, often these functional strategies don’t exist, or there is an unconscious strategy which creates a drag on corporate performance.

Functions such as Design, Customer Experience, Growth, Innovation or Marketing are, what I call, ‘horizontal’ functions, or ‘second tier’ functions. They operate across different functions and need to work collaboratively with multiple stakeholders in different parts of the organisation, who each have their own priorities and agendas. It is therefore easy to get lost in the doing, and make decisions that collectively do not culminate in serving the business, business unit or the function itself.

A function strategy can help align all the different organisational dimensions of the group as relevant for the function, thereby clarify expectations and ease prioritisation and resourcing decisions.

If you are a functional leader, think about how your capabilities contribute the business’ success. What are your priorities for increasing value and what actions do you prioritise to drive that agenda?

Don’t know where to start? Read about how to manage functions in HBR, or take advice from PwC on how to shift from functional excellence to contributing to company strategy.

Collaborative Strategy Design

During this engagement I’ve facilitated a series of sprints with more than 25 senior leaders who all worked in different business units. There is a balance to be struck between what individual leaders would like, and what is possible within organisational and strategic constraints. This is where the Opportunities and Barriers analysis provides great value: It resulted in focussed discussions on what can be influenced by the leadership team, and left what lies beyond their control to one side.

The big gain from designing strategy collaboratively is shared ownership. People who understand why one thing has been prioritised over another do not need to be convinced for buy-in. They are already bought into what they’ve created themselves. A two-pronged approach using top-down strategy (Theory E) as a frame and generating bottom-up strategic objectives (Theory O) from people ‘in the trenches’ results in better engagement, better results and ultimately change. Nohria and Beer have codified the theories of change in their famous article ‘Cracking the Code of Change’ which alludes to involving people in strategy design.

Michael Meyer and Don Norman have developed their theories and recommendations from a design perspective. They describe how design (education) can facilitate change, incl. by collaboratively designing strategy using the unique skills and reach of designers in engaging across silos.

Transition from Individual Contributor to Leader

Operating in a big multinational that is comprised of different business units, functions, horizontal programmes with complex stakeholder relationships can be overwhelming. New leaders, or people who have thus far operated as individual contributors sometimes struggle to divide their attention between delivery, strategic thinking, management and decision-making.

There is something to be said about strategy design, when the people involved have predominantly served as individual contributors prior to being promoted to leadership positions. Strategic Thinking is a skill that can be learned and individual contributors bring a wealth of industry knowledge to the fore once they have honed that skill.

If you are a leader of leaders, bear in mind the Peter Principle which states:

“In any hierarchy, an employee tends to rise to their level of incompetence.”

This does not mean the leaders you lead are incompetent, but it behoves you to consider the reasons why they have been promoted: They likely are high performing individual contributors, who now have a new role with new responsibilities that they have to learn about. One of them is Strategic Thinking. By involving them in the strategy design process you not only help them develop this skill, but you also make them strategic operators and better leaders for their reports. Listen to this Freakonomics Radio episode where Stephen Dubner interviews experts and researchers on the subject.

Do you want to increase the value your function delivers to your organisation?

Get in touch to start your bespoke Functional Strategy Design Sprint

Book an intro session