Understanding and Implementing Strategic Alignment in Organizations
If you’re on the leadership team of an organization, you’re likely to have a good sense of your overall strategy and goals. But you may not be clear on the best way to achieve that strategy. And even if you have definitive steps in mind, your strategy may not be obvious to the rest of the organization.
Strategic alignment is a practice that helps an organization match its ground-level efforts to its big-picture strategy. Learn more about implementing a strategic plan and how to achieve strategic alignment.
What Is Strategic Alignment?
Strategic alignment is a management framework that focuses on ensuring each element of an organization works together toward the same set of business goals. That means getting every department, team, and employee on the same page. It also includes ensuring your business model, vision, and mission are all aligned.
Often, strategic alignment is discussed in the context of strategic planning. Strategic alignment can be seen as the outcome of a successful strategic plan implementation. Being in alignment means that everyone who works at your organization, from C-suite executives to interns, has a shared definition of success.
Why Is Strategic Alignment Important?
If your organization’s day-to-day efforts aren’t in line with your overall strategy, you’re unlikely to achieve your long-term goals – whether that’s breaking into a new market, growing a specific department, or making big improvements to your core competencies.
Strategic alignment is key because it ensures that all the work you do is in service of your mission and goals. The alignment process allows you to better allocate resources and helps you eliminate activities that don’t contribute towards your mission.
What Are the Key Components of Strategic Alignment?
You can’t achieve strategic alignment without a road map. Many organizations have a strategic plan: a document that is the result of a collaborative planning and visioning process. An effective strategic plan should include:
- Mission and vision statement: This set of statements defines your organizational purpose and outlines the impact your company will make. They don’t need to be complicated – many organizations encapsulate their mission in a single sentence.
- Goals and objectives: These are the steps you’ll take to achieve your vision. You’ll want to include both short-term and long-term goals. For example, a short-term goal might be to hire a new sales representative in the next three months. A long-term goal could be to open a new branch office within the next five years.
- SWOT analysis: This is an assessment of your organization’s internal strengths and weaknesses, as well as external opportunities and threats. The SWOT analysis helps you understand your position within your sector or industry. It also helps you see how to stack up against competitors or like-minded organizations.
- Key performance indicators (KPIs): These are the metrics you’ll use to track individual and team performance. KPIs will vary by department and team, but might include things like customer retention rates, return on advertising spend, or employee turnover rates.
Once you have a strong strategic plan in place, you can begin to implement it through the process of strategic alignment.
What Are Five Things That a Company Can Do to Achieve Strategic Alignment?
Creating a good strategic plan is an important milestone. But too often, a strategic plan gets put on a shelf and forgotten about. That’s the importance of strategic alignment. Alignment happens during the implementation phase: putting your plan into action. If you’re looking to improve strategic alignment at your enterprise, try implementing these best practices:
- Review your mission statement: If you don’t have a clear mission and vision for your organization, now is the time to reassess. Get input from key stakeholders to make sure you have a clear, unified direction and are working toward a common goal.
- Clarify roles: Every employee should understand how their specific position and responsibilities contribute toward the goals of the organization. If someone on your team has a project that doesn’t align with your mission, you may need to adjust their role.
- Measure progress: Without clear objectives, you won’t know if you’re meeting your strategic goals. Set your KPIs, communicate them to each team, and revisit them occasionally to see if you need to course-correct.
- Create feedback loops: Managers should check in with employees regularly to help them stay in alignment and to get insights that can help inform business strategy moving forward. Share progress towards your objectives in both one-on-one sessions and department-wide meetings.
- Celebrate: Take time to recognize and acknowledge accomplishments, even if they’re small. When you’re working toward a set of long-term goals, it can be hard for rank-and-file employees to see how they contribute. Give positive feedback and be transparent with organizational data and initiatives. It’s just as important to cheer high-performing KPIs as it it to draw attention to problem areas.
Aligning Strategy with Vision and Mission
Company mission and vision often get lumped together, but they’re distinct concepts. A mission statement describes who you are and what you do as an organization. A vision statement, in contrast, defines your ambition – how your company seeks to change the world around it. In some cases, your mission statement is public-facing, while your vision statement is used internally and in employee recruitment.
A robust strategic planning process makes it easier to link your business strategy to your overarching mission and vision. A strategic action plan is like a road map: it outlines how you’ll get from where you are now to where you want to be in the future.
Your leadership team is responsible for sharing and communicating your strategic plan throughout the organization. Forbes reports that strategy execution fails about half the time – and unclear communication is often a culprit. Strategic plan communication needs to be a comprehensive and ongoing effort, not a one-time meeting. Sharing updates as you hit interim goals can help with engagement and motivation.
Managers can support these communication efforts by helping employees understand how their respective roles fit into the big picture of the company’s mission and vision. Ultimately, you want everyone to be on the same page and working toward the same vision.
Aligning Departments and Teams with Strategy
Regardless of the size of your organization, you can align each department with your overarching business strategy. At every level of your company, people are working toward the same big-picture goals – but of course, the daily tasks of a marketing team are quite different from a human resource department. This is why effective communication is so important. With clear objectives and KPIs, business units can make informed decisions. Each team knows what is expected of them and has a set of metrics to guide and track their performance.
Use these questions to help you assess department or team alignment:
- Are individual roles clear?
- Is there an effective system in place for decision-making and delegating tasks?
- Do individuals and teams across the department collaborate or work in silos?
- Do employees have a sense of ownership over their work?
- Do employees understand how their duties fit into broader strategy execution?
- What systems are in place for monitoring and reporting on KPIs?
- Create opportunities for managers to share best practices so that different teams can learn from one another.
Adapting Strategy to Change
Think of your strategic plan as a living document. Your organization’s strategy should never be static: in a constantly evolving business environment, you need to be nimble and respond to change.
Change management is an organizational approach to dealing with internal and external transformation. These changes can involve your processes, technology, organizational structure, or products and services. Best practices for handling changes in the business environment include:
- Anticipate change: Leaders are better prepared when they expect that change will come no matter what. This is where your SWOT analysis comes in handy. By identifying external pressures that might affect your business, you’ll be better prepared to respond and adapt.
- Encourage feedback: Your executive team may have big-picture insights, but they’re unlikely to have direct interactions with customers. Employees on the front lines are in a unique position to understand customer trends, preferences, and concerns. Make sure there are communication channels in place so employees in customer-facing roles can share these insights directly with their managers.
- Be flexible: Even the most thoughtful strategic plan may need revision. When unexpected changes happen, whether it’s within your organization or outside of it, take time to reflect on how the appropriate response fits into your strategic plan. If they’re not in alignment, it doesn’t necessarily mean you did the wrong thing. It might mean that you need to adjust certain objectives or goals.
By expecting that change will be a constant, your business stays agile – giving you a competitive advantage over your peers.
Aligning with Financial Goals and Objectives
The best strategic plan in the world won’t work if your organization doesn’t have the resources to support it. When it comes to designing and implementing a business strategy plan, financial planning and budgeting must play a major role.
Take these steps to ensure your business strategy and financial goals are working in harmony:
- Assess your financial position: Before you can set financial goals, you need to know your organization’s current position. This includes all your assets and liabilities, liquidity, debt-to-asset ratio, and shareholder equity.
- Allocate resources: As you’re creating your strategic plan, make sure that each department has the budget it needs to achieve its objectives. This might mean upgrading existing technology or allocating funds to hire additional staff.
- Set realistic targets: Your financial goals need to be attainable and should align with your strategic plan. Review historic financial data and look at market predictions to decide what is achievable.
- Pay attention to market forces: You may need to adjust your financial objectives as markets shift. Build flexibility so you can respond accordingly to changes that affect your customers, suppliers, or partners.
- Stay on top of your finances: There should be no surprises where your organizational finances are involved. Ensure that your leadership team is reviewing financial statements regularly to identify variances and reallocate resources if needed.
Advantages of Using Strategy Alignment
When you implement a strategic alignment framework, your organization is more organized, focused, and effective. The benefits of using strategic alignment include:
- Clarity: Employees at all levels of the organization know how their jobs support a central goal. This can increase staff engagement and makes it simpler for managers to assess employee performance.
- Efficiency: The organizational alignment process can help you identify and eliminate redundancies. Plus, it’s easier to make decisions because you aren’t dealing with competing priorities.
- Collaboration and buy-in: Strategy alignment encourages employees to work together. When teams have shared objectives and goals, they are more likely to collaborate and support one another instead of working on tasks in a vacuum.
- Competitive advantage: Strategic alignment can give you an edge over other organizations, ultimately helping you grow your business and increase your profits.
With clear objectives and measurable KPIs, your executive team is more likely to make informed decisions that can improve overall performance. And don’t forget that you need to regularly review and update your strategic plan as business conditions change.
Ensure Strategic Alignment with Spider Impact
Bottom line, if you’re looking for ways to improve your business strategy, make sure you have the right tools in place. At Spider Strategies, we help businesses and non-profits implement and evaluate strategic alignment. Our platform, Spider Impact, is a performance management tool that helps you align goals and strategies across all your organization’s departments and teams. Spider Impact makes it easy to visualize your performance, report on KPIs, and share insights and reports with your stakeholders. To learn more, sign up for a free test drive or demo today.
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