Corporate Level Strategy: Measuring Its Effectiveness

Strategy

Jeff Bartel

Chairman and Managing Director

We often observe corporate leaders not investing their company resources, including time and money, into the development and implementation of a corporate-level strategy, citing that it is not considered a priority. Of course, building a perfect business strategy is impossible, but through careful planning and continuous evaluation, corporate strategies provide strong guideposts and can help forge long-term, effective practices for companies and firms. Accordingly, corporate-level strategy implementation and evaluation, together with maximizing the use of this powerful tool, is a crucial step in the process and must be considered as part of your plan.

The Importance of Corporate-level Strategy Evaluation

Evaluation is usually the final stage of the corporate-level strategy process, but it remains one of the most critical steps. Without this assessment, it is impossible to develop successful and agile business strategies and processes that are quickly adapted to meet new demands.

Your company reaps several additional benefits by implementing a solid evaluation process.

Assess Strategy Success

A comprehensive evaluation can help determine if the strategy is successful, needs adjustments, or requires revamping altogether. In addition, this step can help you avoid wasting valuable resources.

Set Performance Benchmarks

Setting performance benchmarks is a critical component of any successful corporate strategy. These benchmarks provide a way to gauge the success of future outcomes and identify if the strategy requires additional adjustments.

Analyze Outcomes

Evaluating results also ensures that strategy outcomes align with corporate goals, values, and objectives. This alignment is critical to the overall success of your business.

Identify Potential Risks

A close examination of strategy results can identify potential risk factors for the current and future outcomes. This analysis can help you mitigate these risks to avoid future issues.

The Metrics – Measuring Corporate-level Strategies

Measuring corporate-level strategies is not just about tracking basic metrics such as revenue but about assessing strategy outcomes, assuring alignment with corporate objectives, and forecasting success. Ideally, some metrics are set at the beginning of the project. First, however, it is essential to have a comprehensive measurement strategy in place.

Just as no two corporations are the same, no two measurement strategies are identical. Instead, it is crucial to tailor any measuring plan to meet the unique needs of your corporation. Additionally, the metrics chosen depend on the type of corporate-level strategy you want to assess.

For instance, tracking metrics, such as retention rates, employee satisfaction, safety rates, and absenteeism, is appropriate if you assess a workforce management strategy for the corporation. On the other hand, suppose you are evaluating a marketing strategy; KPIs, such as cost of customer acquisition, conversion rates, Net Promoter Score, website traffic, and clickthrough rates, are likely more ideal.

Other standard corporate metrics include:

  • Revenue growth
  • Net sales revenue
  • Churn rate
  • Return on investment
  • Customer retention
  • Website bounce rate
  • Net income
Business leaders analyzing data as part of their corporate-level strategy. It shows a board table with the business leaders' hands, computers, water glasses, and notepads.

Analyzing Data – Evaluating Corporate Strategy

Setting metrics is just the first step of the corporate strategy evaluation process. You must also take the time to transform this data into meaningful insights that drive improved outcomes. While this is not an inclusive list by any means, below is a look at some of the most common analysis strategies.

SWOT Analysis

SWOT analysis carefully evaluates strategy outcomes’ strengths, weaknesses, opportunities, and threats. This method allows you to use the analytical data to identify which parts of the strategy are working well and which need adjustments or removal. It also helps to identify potential risks, as well as any opportunities available, to help expand business processes.

Value Chain Analysis

Value chain analysis takes a different approach by evaluating every step of the strategy process. For example, it may assess operations, talent management, marketing, logistics, and sales. This type of analysis can help identify weaknesses that are impacting other departments. Conversely, it can identify strengths in one department prompting improved outcomes in another. This step can help develop a cohesive strategy for the entire corporation.

SOAR Analysis

SOAR analysis is very similar to SWOT analysis, except it focuses on strengths, opportunities, aspirations, and results. This type of analysis is more forward-focused and ideal for emerging enterprises or corporations in a growth stage.

Take Action – Taking Corrective Action After Evaluating Corporate Strategy

Taking action is the last phase of the corporate strategic evaluation process. Unfortunately, many companies fail to handle this stage effectively. Only change and adjustment can tailor a corporate strategy to meet the needs of the company’s overall outcomes.

Start by identifying weaknesses within the strategy. This is possibly a step in the process, a specific department, or unachieved goals. Next, look for ways to adjust the strategy to improve outcomes. For instance, you may need to develop a new implementation plan, modify corporate policies, and make structural and organizational changes.

Setting metrics, analyzing data, and taking action are all important components of the evaluation process. Using these tools can help your corporation measure success, ensure that the business strategy aligns with corporate objectives, and develop a successful overall corporate strategy.

The Need for Agile Corporate Performance Management

Strategy

Jeff Bartel

Chairman and Managing Director

Agile corporate performance management is essential for the modern dynamic marketplace, requiring adaptability and alignment. It is relevant for adapting to extreme shifts in market conditions like the COVID-19 pandemic. Agility in business enables employees to maintain or increase performance even in the context of a business’s evolving needs. Thus, business performance management approaches are for companies that have aligned business priorities with employee goals to propel the company forward.

Strategic Corporate Performance Management

In an agile business model, corporate performance management (CPM) entails breaking down your company’s strategies into operational objectives and indicators. The strategic approach enables your organization to maintain efficiency through all transformational periods, remaining effective in every next normal.

CMP is also significant for budget remodeling, cost reduction, improved KPI alignment, an upgraded organizational strategy, and a refined financial planning process. In addition, a framework is crucial to ascertain your enterprise performance management. Therefore, strategy execution is of fundamental importance for senior executives today.

How do you implement your strategic plan? Strategy execution involves ensuring your organization’s goals, metrics, and projects align with your strategic priorities and concentrate on key business drivers. Many organizations join the corporate performance management market size by dedicating an entire performance management department to achieve agility in business.

The performance management cycle is a four-phase closed loop. It contains:

Strategies and Objectives

The first step of the corporate performance management framework is setting the organization’s strategies and objectives. Next, identify the goals and strategies that support your organization’s corporate purpose and financial performance that align with the framework to maintain business agility in every wind of change. You can quantify them as projected revenue or growth, ROI, market share, customer satisfaction and retention, carbon emissions, employee retention or diversity, workforce incidents, and many more.

Targets and Metrics

Establish key business drivers that help achieve your objective and strategies. Business metrics measure values, indicating the organization’s progress concerning its strategic goals. Therefore, understanding the relevant KPIs for your business is essential.

Performance metrics used in corporate performance management include;

  • Financial metrics – financial corporate performance management entails using data from the company’s books of accounts, income statements, balance sheets, and cash flow statements or budgeting and forecasting data like earnings, expenditures, and inventory reports.
  • Internal metrics – analyzes the quality of corporate management performance through employee performance.
  • Customer satisfaction and loyalty – are critical indicators of the business’s health and performance.
  • Compliance metrics – measures how well your organization follows employment regulations, financial reporting, and environmental rules.
  • Strategic metrics – indicates how well your organization executes strategies implemented by management to attain immediate targets and achieve long-term goals.

Execution of Strategic Plans

Develop an annual execution plan using business drivers, short and long-term goals, and targets.

 Measurement and analysis create a continuous performance management process.

Measurement and Analysis

Develop systems and methodologies for measuring KPIs for the business’s financial and operational plans. Use any relevant data that supports business performance management, converting it into actionable business information that is quantifiable to gauge the success of the objectives and operations.

Measurement and analysis create a continuous performance management process. Each evaluation comes with adjustments to maintain the success of the strategies. Traditional analysis processes take time to bring results. Agile business intelligence is a better alternative for real-time analytics.

Agile Business Philosophy Creates Corporate Adaptability

Agile for business means easy adaptability through change. It shifts attention to people and interaction instead of tools and processes.

Agile boosts a business’s velocity to adaptability and sustainability in a volatile business market. Therefore, your firm develops an enduring competitive advantage and a dominant position in the market.

Rapid feedback systems are indicators of an agile business. The resulting ecosystem from such mechanisms fosters interactions, enhancing trust among stakeholders. Feedback loops also encourage collaboration. They also lead to quick problem identification and the implementation of mitigation strategies.

Agile processes facilitate high communication rates through feedback loops. The constant communication enables stakeholders to stay updated on changes. It is easy to trace errors and implement changes.

Why Your Company Needs Agile Corporate Performance management

Employees respond positively to agile enterprise performance management because it encourages communication and collaboration. Employees can take part in the change process.

An agile enterprise and corporate performance management also enhance work efficiency by keeping employees focused on ongoing tasks instead of multitasking. Face-to-face interaction also increases productivity since it encourages collaboration.

The agile approach also provides the feedback employees want. The process encourages participation by integrating real-time feedback into the employee’s workflow instead of the traditional receiving orders from management. The two-way conversational approach also nudges employee’s in the right direction.

Furthermore, employee performance improves based on collaborative and communication efforts. They get timely feedback and are empowered to ask pertinent questions about performance.

Three Keys to Implement Agile Corporate Performance Management

  • Linking goals to business priorities – the best corporate performance management approaches align business goals and operations to their purpose and vision.
  • Another best corporate performance management practice is training managers on interactive and collaborative skills to improve employee interaction.
  • Differentiating consequences – differentiate rewards for extreme performances.

Government and Private Sector Collaboration for Innovation

Strategy

Jeff Bartel

Chairman and Managing Director

Innovation drives competition and progress in all sectors, making it a critical factor for the success of both private entities and government agencies. Moreover, both organizations bring something to the table for innovation purposes, making collaboration an ideal option in many cases.

When Should Government and Private Sector Organizations Collaborate?

Private sector and public organizations should collaborate when:

  • They can align on a desired common outcome
  • The type or level of a challenge requires something from every kind of organization, such as government authority and commercial agility
  • A need arises that may draw on the resources of both sectors

Some examples of times when public and private sector collaboration can be essential include:

  • Public health crises (the COVID-19 pandemic is a recent example)
  • Times of economic strife (such as a period of recession or depression)
  • Periods when nations or societies are facing challenges that are extremely large in scope (such as climate change)

Why Do Government and Private Sector Organizations Collaborate?

Government strategy consulting and other private-public collaborations have additional benefits for both sectors besides the outcome of the work at hand. Some of the biggest reasons for these types of partnerships are summarized below.

Collaborations Build Public Trust

Public trust is an issue for governments and enterprises. During the COVID-19 pandemic, public views on how trustworthy the government was decreased. The majority of Americans did feel the United States government was somewhat or very good at keeping the country safe from terrorism, responding to natural disasters, ensuring safe food and medicine, and maintaining infrastructure. However, the majority felt the government was bad at protecting the environment, providing access to healthcare, handling threats to public health, helping people get out of poverty, and managing immigration.

According to the 2022 Edelman Trust Barometer, trust in government continued to decline following 2020. On the other hand, business is seen as a unifying force in society. Most people believe that businesses provide leadership and successfully execute plans to yield positive results when faced with challenges.

Public-private collaborations allow efforts to be accepted in a more trusting light that might be seen as suspicious if only governments were involved.

Collaborations Have a Record of Success

Collaborations between the government and the private sector have a record of success across a wide range of challenges. When businesses are involved in regulatory strategy, for example, the results can be more realistic requirements that industries can uphold while supporting the health of the market and positive outcomes for labor, the environment, or other concerns.

Successful collaborations help drive down costs (for businesses and the public), achieve goals, and provide positive outcomes more likely to work for all.

Building Relationships to Solve Problems in the Future

Present collaboration creates foundations for relationships that help solve problems in the future. For example, when public-private collaboration works toward environmental integrity now, it helps mitigate climate change issues in the future.

Government and Private Sector Collaboration for Innovation

Collaboration is a must-have when faced with immediate concerns like a natural disaster or health crisis. However, the government and the private sector should work together for innovation in a proactive bid for a better future.

What Drives Government and Private Sector Innovation?

The biggest driver for this type of innovation is increased economic and social success. Other motivators include optimizing resources, minimizing risks by sharing burdens, overcoming resource and data barriers, and supporting higher contribution levels and buy-in for ongoing support from various sectors.

Barriers to Innovation

Common barriers to innovation include a lack of leadership or accountability, fear that keeps projects from moving forward, a lack of resources, short-term thinking that traps organizations in the status quo, and an inability to deliver solutions “to market.”

Luckily, a collaboration between federal, state, or local governments and private sector organizations breaks down many of these barriers. When private and public sectors are aligned on the desired outcome, fears associated with perception are drastically reduced, resources are typically increased, and the integration of various thought processes makes short-term thinking less likely.

How Is Successful Innovation Collaboration Measured?

Success is measured via ROI. Collaboration teams should look at resources invested in the effort and the types of returns experienced. These returns may not be in the form of money or goods but increased trust, positive R&D developments, or the desired outcome. Traditional metrics such as financial returns can also be accounted for in determining success.

Examples of Successful Government and Private Sector Collaboration

Social Challenges

Business and public resources can come together to solve government issues or more considerable social challenges. One example is in India, where the ability to travel to urban areas to vote, bank, or access healthcare was limited in many areas. So the government worked alongside technology firms in the nation to plan and build a “digital highway” that provides virtual access to services to all of India’s citizens.

Urban Challenges

Urbanization and gentrification of cities may be suitable for local economies in some ways, but it causes a variety of challenges that are being met by public-private collaboration. Increasing property prices and pollution and displaced populations living in urban environments before gentrification are just a few of the obstacles collaborative innovations are helping to solve.

Working within a strategic issues management group that brings together resources from the public and private sectors, individuals, businesses, and agencies can achieve more.