I once attended a presentation by George H. Labovitz, PhD, titled Rapid Realignment – Leading, Focusing and Mobilizing the Organization. The presentation focused on improving profits by optimizing organization alignment. Dr. Labovitz recounted many of his private discussions while consulting with former Navy Chief Vern Clark. I found the following quote to be the most interesting and relevant based on work that have done. When he became the Chief of Naval Operations, Admiral Vern Clark told George Labovitz:
“I made alignment my #1 goal for the Navy because, in my business, second place is a terminal disease.”
CEOs in the current business environment are now coming to Admiral Clark’s realization that unless they take decisive action to quickly refocus and redirect their organizations, for them too, second place could be “a terminal disease.”
Alignment is the strategy of bringing people, process and technology together to drive profits and growth. The strategy makes sense. It is, however, easier said than done. There are two reasons why many retailers fail to optimize alignment or become mis-aligned soon after a restructuring. Reason one is that retailers don’t have the tools or internal capability to gap or benchmark current technologies. They are very familiar with their own systems but are often frustrated by what the technology can’t do. Some retailers fall prey to the “grass is greener” scenario and are always looking for the latest and greatest (and often very expensive) technology that will solve all the issues and they never come to realization that great systems also require great people and great processes. New technology implementations require reallocating human resources by matching different skill sets with the resulting new processes – some refer to it simply as Change. Optimizing profits begins with assessing available technologies and determining the best fit cost/benefit for the organization.
Reason two why retailers fail to optimize alignment or become misaligned soon after a restructuring is that alignment metrics are never considered or retailers don’t have the tools or internal capabilities to determine the right metrics.
……………………continued next time in Part 2.