Strategic HRM: The Will and The Way!

The test of corporate wherewithal comes when everything else looks blurred…

• Operating dynamic determines an organisation’s ‘will to compete’ in a threatening environment
• There are a number critical functions and generators/blockers that shape the operating dynamic

Ask any layman about the factors that contribute to organisational success, and the chances are that he will begin with strategy and finish with people. Moving further, when the same question is put to a person with knowledge and exposure to the corporate way of functioning, he too would mention the same factors, but in a different sequence. The most interesting finding from this ‘survey’ is that people tend to attribute organisational success to factors that are tangible, but miss out on intangible ones, thereby underplaying the role of critical performance drivers like ‘will to compete’ and ‘will to survive’.

Will, like in the case of individual performance, plays a critical role in determining business success. However, in the context of organisational performance, the will to compete is expressed in terms of operating dynamic. The term can be best described as the “resultant leadership that remains after all forces--negative and positive--are accounted for”. In the case of organisations where the resultant leadership is positive, the will to compete and survive is high. Such organisations will be in a better position in many respects, than those where the resultant leadership is negative. Understanding how organisations can build positive resultant leadership levels and create for themselves an environment that helps succeed in tough times and flourish in good times is important to sustain growth.

Operating dynamic

Operating dynamic works at the macro level, impacting the enterprise at large. It is beyond any one individual, be it the CEO or a supervisor. It represents the collective pulse of the organisation and needs to be understood by leaders before taking up new and change-driven tasks. Operating dynamic comprises a number of organisational forces that determine its impact. Of these, there are 15 forces that are most critical to business success. These forces are further classified into critical functions and generators/blockers, depending on their impact.

Critical functions

• Talent management
• Performance strategy
• Customer responsiveness
• Profitable growth orientation
• Lean operations
• Innovation and creativity

These functions reflect the operating dynamic of organisations and indicate its future growth trajectory. These six critical functions are key performance drivers. They work towards enhancing overall staff productivity. These functions are highly flexible and can be changed by the management. After identifying the critical functions, leaders also need to identify the generators/blockers that would help in the execution of these functions.

Generators/blockers

• Corporate decision-making capability
• Corporate assertiveness
• Leadership accountability
• Transparency
• Adaptability
• Commitment and devotion of management
• Accountability and responsibility
• Effectiveness and leadership efficacy
• Internal competition

While the critical functions represent the intangible balance sheet of corporate performance, the generators and blockers represent the growth and loss index that is akin to the profit and loss statement.

Scaling operating dynamic
Having determined the various forces that indicate the state of the operating dynamic in an organisation, how do leaders measure them? The task is challenging since quantifying ‘soft’ issues is difficult. Nonetheless, experts have arrived at a solution that translates employee perceptions about the types of forces at work within an organisation into quantifiable parameters. The measurement framework is based on the fact that perception is reality, when organisational working is concerned. Worker perceptions seldom go wrong. Hence, processing the feedback through a template that is more like a balance sheet, and converting the perceptions into performance-linked changes, can help leaders arrive at a convincing case for operating dynamic.

After arriving at a clear consensus about the operating dynamic state within the organisation, leaders can identify areas that need change, and work to accomplish it. CEO involvement, however, is critical for achieving the desired result, since delegation and task distribution is the corner office prerogative.

The operating dynamic approach, thus, assures leaders that the ‘will to compete’ can be nurtured and developed.

Reference:
The ManageMentor