The corporate board’s strategic oversight and agile governance practices is crucial to identify and strengthen the weakest link in strategy management.
Nowadays running business is complex due to rapid change and fierce competitions. Corporate governance and management are complementary disciplines to ensure business effectiveness and efficiency. Excessive management complexity enlarges functional gaps, limits performance and slows down change speed. It’s important to look for the linkage between management and governance to unlock business performance.
Is the strategy is incomplete and or flawed or both: Often there are disconnects between strategy and execution. It is impossible to plan and implement something you cannot do.The cause of incomplete strategy is either the assumptions in the strategy were not fully vetted or market dynamics wasn’t anticipated. Strategy creep can be indicative of larger planning issues such as poor due diligence in the planning phase, lack of seamless alignment with vision or mission, lack of clear objectives, lack of clear goals, etc. Even when the strategy is appropriate, poor implementation will derail it. The cause of ineffective strategy implementation varies, corporate boards’ oversight of business strategy is critical to scrutinize the effectiveness of strategic planning or the logic of strategy implementation as the success of strategy execution is multipath, information-dependent and dynamic.
Corporate board’s governance practices help the management improve decision coherence by closing blindspots and bridging certain gaps. When there is no consequence for making mistakes, there is no point in investing the time needed to make sure that decisions are sound. Top leaders like board of directors go beyond a senior title, their leadership competency is based on their bigger and deeper thinking box and fresh insight to help the management understand that the execution was going to impact other areas of the business in ways they didn’t anticipate. Even if you have a fair strategy, when mistranslating the good strategy into a set of unclear goals and objectives, it further causes the failure to implement a strategy.
Have you underestimated the competition, how to improve long term business competency: With unprecedented levels of uncertainty around a volatile marketing situation, emerging business properties, fierce competition, disruptive technologies and so many variables to consider. Competition has different connotations and meanings under different situations or context. In recent days, technological advancement is pressuring the firms more than other factors. The economic factor is varying because an organization needs to understand the market in which it will be selling its product and service. The political factor also plays an important role in the external macro environment which keeps evolving. Insightful BoDs help the management gain deep understanding of business circumstances and deepen competitive analysis; what the demand is for its product or service, and what its competitors are doing.
With frequent disruptions and fierce competitions in the business ecosystem, individuals or organizations simply cannot stand still, never innovate or never make progress. To enforce governance discipline, you can also use scenario planning to explore how your current strategies will or will not help you against possible disruptions by establishing a set of “What-if” scenarios showing the potential scale of business benefit, as well as estimate risk and hidden pitfalls. It’s even more critical to embed predictive actions into repeatable business processes to improve business efficiency and speed. Organizations face unprecedented uncertainty and fierce competition, business differentiation can be accomplished by having a sustainable organizational competitive advantage to the market, rooted in operational or innovation excellence which makes it difficult or even impossible for competitors to imitate.
Are meeting the needs of our customers that have been validated? Forward-looking companies across the industrial sectors are inspired to run people-centric organizations. Customer satisfaction or some aspire to achieve customer delight is more a vision. Even that it changes often, which can be characterized by indicators of short-term satisfaction, how they liked or disliked the purchase transaction they just completed; or the long-term satisfaction, more with product or service fit, form, function and aesthetics, and other elements of satisfaction such as cost/performance, available variation, service levels, and ease of use.
The BoD’s governance enhancement helps the management set a tone of customer-centricity, catalyze innovation and advocate personalization, assess customer satisfaction key performance indicators such as loyalty, delight, experience as lead indicators objectively. The level of increased customer satisfaction would be also based on both the industry and wherein the enterprise the innovation is occurring. The more customer-facing the innovation, the higher the customer satisfaction would be; the more loyal customers the company can cultivate. Because loyal customers are required to help achieve objectives like increasing revenue by (growing the customer base, and increasing purchasing $$ per customer.
BoDs are humble to learn, bring their professional competency and maturity to the next level which will make them a more insightful leader. The corporate board’s strategic oversight and agile governance practices is crucial to identify and strengthen the weakest link in strategy management. They set the priority to stay focused, identify promising big ideas for investment that will accelerate bold change, and continue to prioritize and adjust the strategy, to leverage growth potential, enhance governance disciplines; laser focus on the most critical perspectives to steer the business in the right direction, and ensure business success in the long run.