Category: Organization, Change, & HR

Corporate Compliance: Ending Unethical Behavior
Corporate non-compliance is a major issue across the world. Highly public cases involving major corporations point to the fact that the usual descriptions of why business employees perform illegal acts are misdirected.

No Compliance Program can completely eradicate unwanted conduct by a few employees. Behaviorally aware programs, however, show potential of realizing the main goals of Compliance i.e., reduction in unethical and illegal behavior within the company.

To this end, cognizance of employee behavior is vital, of which Decision-making is the most important part. Humans make decisions using 2 ways:
1. Intuitive—referred to by psychologists as System 1—This Decision-making happens by associative memory and habit, which hampers control or alteration. Rapid associations are offered by the mind, idea after idea, all associated effortlessly.
1. Reasoning—referred to by psychologists as System 2—This Decision-making is employed using thought in an ordered way e.g., to answer complicated math problems, to compose a paragraph, or consider multidimensional decisions.
Since System 2 takes more mental effort, humans tend to rely mostly on System 1 for most of the Decision-making. The problem with that is people tend to use System 2 to justify decisions made using System 1 instead of judging their decisions by it.

Although Behavioral Ethics Research is the foundation for studying System 2’s failure to prevent Unethical Behavior, it does not completely explain it. Criminology helps us go further in this regard.

Criminologist point at fulfilment of 3 conditions for an unethical act to occur:
- A non-shareable problem.
- Problem has to be solved by violating trust.
- Verbalization has to occur.
Effective methods for compliance pay attention not on the way government regulators respond to compliance initiatives rather on how employees—the actual users—will be affected.

Behavioral Strategy in conjunction with criminological insights suggests the following 3 cost-effective steps that companies can take to steer away from the innate behavior of serving self-interest that results in compliance violations:
1. Appoint Behavioral Expert.
2. Eliminate the root-cause via best practices.
3. Employ inducements to direct behavior.
These 3 simple steps aid in improving the behavioral implications of the Compliance Program, overpowering employee rationalizations that end up in violations.

Let us delve a little deeper into some details of the 3 steps.

Appoint Behavioral Expert

Objective of this step is to apply various theories like dual system of thinking, rationalization, and behavioral ethics—which have been in existence for quite some time—to the business particularly to compliance related issues in a holistic fashion. Companies are just starting to realize the significance and effectiveness of this practice.

Hiring an expert externally or developing someone internally, to stay informed of the different fields and their growing insights into ethical business decision making, is the 1st step in ensuring compliance with ethical behavior.

Eliminate the root-cause via best practices

The next step involves employing best practices—motivated by Behavioral Science which is at the core of criminology and behavioral ethics, such as nipping violation risk in the bud through preliminary declarations, having moderated conversations among employees, sharing success stories—to stamp out the root cause of unethical behavior. Compliance Programs should have the objective of eradicating rationalizations, if they are deemed to be the cause and root of employee misconduct.

Employ inducements to direct behavior

The last step entails deploying appropriate reward and incentive structures—monetary, otherwise, or in combination—to positively influence the way compliance is viewed by employees within an organization.

Research suggests that in case of significant corporate trust violations, the main reason, frequently, pertains less with a rogue employee and more with sections of the organization that are dysfunctional, conflicting, or incongruent.

Interested in learning more about Ending Non-compliance and Unethical Behavior in companies? You can download an editable PowerPoint on Corporate Compliance: Ending Unethical Behavior here on the Flevy documents marketplace.

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– Roderick Cameron, Founding Partner at SGFE Ltd
July 18, 2022
Business Model Diversification
Strategic objectives of all businesses are to propel growth and performance, while simultaneously creating value for customers.

While it is customary for managers to emphasize financial performance, effective managers pursue new opportunities in order to create added value.

Business Model Diversification allows creation of value, if managed astutely, and can aid managers enhance performance and expand the goal of the enterprise.

At the foundation of any sustainable organization is its Business Model—the system of symbiotic organizational pursuits to generate and capture value.

For organizations desirous of sustaining a Competitive Advantage in today’s highly competitive business environment, Business Model Diversification—employment of multiple Business Models for value creation and revenue generation—has become a necessary pursuit.

Organizations achieving breakout growth in their industries diversify their Business Models using approaches like Business Model Innovation (BMI)—a tool that concurrently brings about reciprocally supportive changes in value proposition to customers as well as to the core Business Model.

BMI is a powerful, yet underleveraged, tool that can drive breakout growth within an organization’s core business.

According to Michael Porter, strategic diversification is about combining activities that efficiently relate to and mutually reinforce one another, forming a system of activities, as opposed to a collection of isolated activities.

Judging which activities can fit together within a Business Model and at the same time be synergistic across Business Models, is a complicated and delicate endeavor requiring a structured approach.

Research by MIT Sloan Management Review brought forth a framework for analyzing efficacy of diversifying Business Models. The framework assisted in studying Formula 1 auto racing industry, the multiple businesses run by Amazon Inc., and almost 50 other companies.

This research study was based on the following 3 questions:
1. What considerations should be taken into account when contemplating Business Model Diversification?
2. How can value assessment and optimization of a new Business Model be conducted that is intended for inclusion in the portfolio?
3. How can the Business Model portfolio be improved with the passage of time?
In order to answer these questions an 8-step framework was developed that envisages the complementarities in a Business Model portfolio. The 8 steps allow separation and analysis of the numerous activities that comprise the Business Model Portfolio. Following steps go into creation of the visual map for a Business Model Portfolio Analysis:
1. Identify Business Models
2. Identify Key Resources
3. Identify Key Capabilities
4. Identify Key Performance Indicators (KPIs)
5. Connect Model to Resources & Capabilities
6. Identify Interconnected Resources & Capabilities
7. Analyze
8. Monitor & Maintain
These steps enable visualization of relationships among the various means and competences, and their influence on Performance, thus amplifying the correspondence across a Business Model portfolio.

Discussed below are some details of a few steps integral to developing a robust Business Model Portfolio:
- Identify Business Models
  - Foremost step in the 8-step process is to itemize the company’s Business Models.
- Identify Key Resources
  - Ascertain the significant resources each Business Model produces e.g., financial resources, user data.
- Identify Key Capabilities
  - Determine the essential capabilities resulting from each Business Model e.g., technological capabilities, sales capabilities.
Interested in learning more about framework for Business Model Diversification? You can download an editable PowerPoint on Business Model Diversification here on the Flevy documents marketplace.

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– Roderick Cameron, Founding Partner at SGFE Ltd
July 18, 2022
Digital Maturity Strategy
Go digital or go home. To survive in the Digital Age, organizations must pursue Digital Transformation to not only support strategies and reach customers, but also to modernize and achieve excellence in their internal operations and processes. The pursuit of Digital Maturity is quickly becoming a necessity.

Yet, most organizations are unable to properly strategize their transition to Digital Maturity. Nevertheless, there are organizations that are digitally mature or are leaping towards that state with ease. Research into the Strategy of such organizations reveals that digitally mature organizations apply following 5 practices that make them leaders in this race:
1. Digital Organization
2. Digital Strategy
3. Digital Experimentation
4. Digital Talent
5. Digital Leadership
These 5 best practices provide the foundation to Digital Maturity Strategy. Let us delve into a little more detail of some of these best practices.

Digital Organization

Conventional Organizational Structures arranged in functional silos do not cut it in the dynamic and rapidly changing markets. Fresh approach to Organizational Structures has brought forward cross-functional team structures. Customary command and control systems hinging on functional silos are hindering the agility necessary in the current market scenarios.

A research survey categorized Digital Maturity of organizations into early-stage, developing, and maturing organizations. Nearly 60% of the respondents from the early-stage deemed the management structure and practices in their organizations as an impediment to engaging in Digital business successfully. Digitally Maturing companies, on the other hand, had 80% of the respondents saying that their leaders had adequate understanding and capability to lead the organization’s Digital Strategy.

Digital Strategy

Effective Digital Strategies are not merely implementation of technologies for the purpose of becoming more Digital, rather they are purposed to identify opportunities for greatest business impact.

Research consistently indicates that Strategy is the most formidable differentiator of Digitally Maturing companies. Digital Strategies lay out how the organization conducts business distinctively, given the changes brought about in the market by new Digital technologies.

When asked about actions needed by the company to increase Digital Maturity, 40% of respondents in a survey, felt the need for improvement in Digital Strategy and Innovation. Percentage-wise, research found that 80% of the Digitally Mature companies had, or were likely to have, a well-defined and coherent Strategy as compared to 19% of Early-stage companies. Research concluded that Digitally Mature organizations are 2 times more likely to Strategize for 5 years or more.

Successfully executing Digital Strategy demands concentrating on Organizational Change and building flexibility so as to attune to swiftly changing Digital environments.

Digital Experimentation

Almost every organization indulges in experimentation with technology. But the scope and scale of experiments sometimes do not provide outcomes that may have an enterprise-wide effect. Digitally Maturing companies have the capability to escalate Digital Experiments.

Key to effective experimentation is to think of experiments for urgent business problems—that will push enterprise-wide Innovation—then conduct smaller experiments that can be ramped up once successful.

Digitally Maturing organizations are 2.5 times more apt at conducting small experiments and scaling enterprise-wide Innovation, compared to Early-stage companies. Open-mindedness towards failures and the capacity to learn from them strengthens the ability to scale up small experiments.

Interested in learning more about Digital Maturity Strategy? You can download an editable PowerPoint on Digital Maturity Strategy here on the Flevy documents marketplace.

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– Roderick Cameron, Founding Partner at SGFE Ltd
July 7, 2022
3 Approaches to Global Innovation
The current ever-changing and increasingly connected world demands taking an amplified approach to Innovation and Innovation Management.

The conventional method of innovating locally and distributing the product or service globally is now being questioned more and more. Effortless availability of unparalleled knowledge, essential for Innovation, is one key factor in bringing the traditional approach into question.

New approaches are now necessitated in order to take full advantage of the vast array of knowledge easily available across the globe. There are 3 approaches that are preferred more than others:
1. Staying Approach
2. Visiting Approach
3. Inviting Approach
The approaches are different because of the diverse scenarios faced by different companies. Even though these approaches attempt to address the subject in non-identical ways, the final purpose continues to be no different—i.e., infusing a Global Innovation Culture.

Let us examine the approaches in a little more detail.

Staying Approach

This approach finds it crucial to immerse the operation in the local area while attempting to innovate.

Aspiration behind Innovation development, in quite a few instances, is to gain knowledge, information, knowhow, and technology that is, typically, deficient in the organization. Aim behind immersing in the local environment is to cultivate high quality networks, internal and external relationships, thus promoting Innovation.

In reality however, some companies even after spending a long time in a location do not get noticed and engaged. A major cause for such failures is dearth of partnerships.

Visiting Approach

Also dubbed the Travel approach, this method advocates keeping a distance as opposed to the Staying approach because complete immersion in a location has an adverse influence on Innovation.

Understanding the Visiting approach from a business management or sociological viewpoint is easier through the Network theory. Theories underlying this approach contend that full immersion in a location deteriorates thinking and Innovation.

The theories further assert that a certain amount of distance allows combining their own outlook with that of the local area thus permitting knowledge, information, and knowhow from several regions.

The role of the knowledge-information broker becomes a key in such scenarios.

Inviting Approach

In place of visiting the Local area, this approach promotes Inviting Innovators from other organizations to foster a culture of Open Innovation. This approach requires that visits should be terminated when attempts are made to take Innovation to the Global level. The basis of this approach is efficiency and the fact that any company going Global will have sufficient wherewithal to invite others to come to it.

This approach is not restricted to big corporations of the developed world only; rather it accommodates businesses of developing countries too.

This approach is often used by Second Mover companies who want to draw alongside the leaders.

Drawback in this approach is that it brings into the open the Innovative needs of the company and thus its vulnerabilities.

Global Innovation has both Local and Global Innovation aspects that pertain to Autonomy and Control.

Characteristic of Local Innovation is increased autonomy and scarce information-sharing with headquarters. Global Innovation proposes an amplified degree of information-sharing with HQ but it comes with the cost of losing autonomy as HQ starts to control more and more.

In the debate of Autonomy vs. Control, a mechanism to preserve information-sharing without reduced autonomy is essential for organizations aspiring to take their innovation to the global level.

There are 2 common methods used to strike a fine balance between Control and Autonomy:
1. In the 1^st method, local operation takes the decision but headquarters maintains the classified information.
2. In the 2^nd method, information moves to the local operations but headquarters makes the decision.
Interested in learning more about these approaches to Global Innovation? You can download an editable PowerPoint on 3 Approaches to Global Innovation here on the Flevy documents marketplace.

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You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd
March 14, 2022
Is It Mandatory for a Company to Provide HIPAA Training for Employees?

Many companies are mandated by law to provide HIPAA training for their employees. However, some companies choose to provide additional HIPAA training beyond what is required by law. This extra training can help employees understand their role in protecting patient privacy and comply with HIPAA regulations. If you want to know more, keep on reading.

What Is HIPAA?

HIPAA is the acronym for the Health Insurance Portability and Accountability Act. It was signed into law in 1996 by President Clinton. HIPAA set national standards for protecting the privacy and security of patients’ health information. The law also established new requirements for how health insurers must handle customers’ health information. HIPAA applies to “covered entities” and their business associates. A covered entity is a healthcare provider, health plan, or healthcare clearinghouse. These entities must comply with HIPAA’s privacy and security rules. Business associates are organizations that help covered entities meet their HIPAA obligations, such as third-party billing companies and cloud storage providers. With this, there is also HIPAA training material that is required to be given to all employees of both covered entities and business associates. This is where most of the confusion comes in, as some employers are not clear on if they are a HIPAA covered entity or not.

What Is the Purpose of HIPAA Training?

The purpose of HIPAA training is to educate employees about their role in protecting patient privacy and complying with HIPAA regulations. Employees must understand the importance of protecting private health information and know how to comply with HIPAA’s privacy and security rules. HIPAA training is important for a number of reasons. First, it helps employees understand their role in protecting patient privacy. Employees must comply with HIPAA regulations if they want to avoid penalties. Second, HIPAA training helps employees understand the importance of protecting private health information. Patients are increasingly concerned about their privacy, and companies that protect patient privacy are more likely to earn their trust. Finally, HIPAA training can help employees avoid data breaches. A data breach can occur when an unauthorized person accesses confidential patient information. Data breaches can cause a great deal of harm to patients and can be costly for companies.

How Is HIPAA Training Provided?

HIPAA training is typically provided in two ways: online training or instructor-led training. Online training is a convenient way to learn about HIPAA. Employees can take the course at their own pace and on their own time. Instructor-led training is a more traditional way to learn about HIPAA. Employees attend a training class and receive instruction from a trained instructor. Both online training and instructor-led training are acceptable ways to meet HIPAA’s training requirements. Also, depending on the size of your company, you may be able to send employees for onsite HIPAA training.

What Are Key Steps to an Effective HIPAA Training Program?

The first step in creating an effective HIPAA training program is to identify the workforce’s roles and responsibilities with respect to HIPAA. All employees who have access to protected health information (PHI) must receive training on how to protect PHI, as well as what is expected of them in regard to safeguarding PHI. Once the workforce’s roles and responsibilities have been identified, the next step is to develop training materials that are tailored to the workforce’s needs. Training materials should include an overview of HIPAA, including what constitutes protected health information and why it is important to protect it, how to safeguard PHI against unauthorized access, use, or disclosure; and what to do if a breach occurs. Also, employees should be trained on how to respond to requests for PHI from patients and authorized requestors.

Is HIPAA Training Required Yearly?

There is no one-size-fits-all answer to this question, as the requirements for HIPAA training will vary from company to company. However, most experts agree that HIPAA training should be an ongoing process, and not a one-time event. Employees should be provided with new or updated information whenever there are changes to the HIPAA regulations. That said, there is no specific requirement in HIPAA law that states employers must provide yearly training to their employees. However, if an employer fails to provide adequate training and employees end up violating HIPAA regulations, the employer could be held liable. So, while there is no legal obligation for companies to provide annual HIPAA training, it is definitely advisable to do so.

By ensuring that employees are up-to-date on the latest HIPAA regulations, you can help minimize the risk of data breaches and other compliance violations. If you’re unsure of where to start, there are a number of online resources that can help. The Department of Health and Human Services (HHS) offers a free online training course called “HIPAA Security Basics for Employees.” This course is designed for individuals who are responsible for implementing or managing HIPAA security requirements within their organization. It covers topics such as password protection, data encryption, and secure emailing practices.

Is This Training Hard to Complete?

The HIPAA Security Basics for Employees course is designed to be user-friendly and easy to navigate. The course is divided into five modules, which can be completed at your own pace. There are quizzes at the end of each module to test your understanding of the material, and a final exam at the end of the course. Upon completion, you will receive a certificate of completion. It is important to note that this course is just one of many resources available on the HHS website. The agency also offers a variety of other online courses and tools, such as fact sheets, toolkits, and templates. The training itself is not hard, but you do need to be familiar with the HIPAA regulations in order to pass the quiz. Once you have a basic understanding of the law, the course is relatively easy to complete.

Overall, it is advisable for companies to provide annual HIPAA training to their employees. This training can help minimize the risk of data breaches and other compliance violations. So, while there is no legal obligation for companies to provide annual HIPAA training, it is definitely advisable to do so. If your company needs help getting started, follow our tips on how to complete a HIPAA training program.

March 14, 2022
Leadership Operating Model Design
Most people believe that the value and impact of the C-level leadership originates from the number of meetings conducted, having the ability to plan for long term, and make key strategic decisions collectively. However, in reality, the C-level seldom works in unanimity to make collective decisions. They often have animosities with each other and lack collaboration and mutual trust.

The real impact and success of the top team emanates from the informal and social networks of its members, their resolve to capitalize on those connections for strategic decision making, and their competency to perform well in subgroups created to solve pressing concerns.

Effective C-level leadership is conscious of the value of their informal / social networks and their ability to deal with serious issues. They organize themselves in a way to work as the nucleus of the organization, which gives them the leverage to promptly act on adversities or opportunities.

Leadership’s Social Network Analysis

C-level’s informal social network enables an organization to draw combined capabilities—in-house as well as the extended network. Top leadership needs to evaluate the strengths of their social network by mapping their informal associations. This can be done by conducting surveys, analyzing meetings, phone calls, and emails.

The social network analysis reveals that 90% actionable information comes from this informal leadership network rather than through internal reports and datasets. These linkages aren’t distributed evenly; some members may be highly networked commanding a major chunk of two-way interactions across the organization whereas others may have a smaller network and lesser influence accordingly. The analysis also suggests that poor leadership connections lead to failed decisions—whereas enriched networks cause advancement in Innovation and Organizational Efficiency.

To design—or redesign—an effective Leadership Operating Model, organizations need to incorporate 3 key principles in their operations:
1. Leverage Focused Subgroups
2. Improve Networking Effectiveness
3. Manage Conflicts at the Constituent Level
These 3 principles aren’t simple to implement. It warrants evolving the very nature of how the senior leadership team functions and design a more poised and assimilated Operating Model.

Let’s discuss these principles in detail.

Leverage Focused Subgroups

Senior leadership’s performance cannot be judged solely by its ability to revamp the enterprise’s organogram. Effective top leadership demands from the team a capability to form peer-to-peer, top-down, and bottom-up relationships; and work in discrete yet linked groups, each of which is focused on solving a unique problem or tapping an opportunity.

Depending upon the circumstances, leaders should adopt any of these modes when dealing with networks. Focused subgroups work best in 3 discrete modes:
- Discussion Groups – These groups focus on information flow, comparing notes, and updating each other on progress. The mode does not cater strategic decisions or active leadership.
- Single Leader Units – In this mode, every executive of the group has clear responsibilities and is accountable to one boss who has the authority over the others to enable speed and efficiency.
- Real Teams – This subgroup includes executives possessing similar capabilities, who are committed under an accommodating leader to achieve shared objectives.
Networking Effectiveness

It is culturally acceptable at many organizations to utilize time on trivial matters—e.g. unnecessary e-mailing, lengthy approval cycles, long-drawn-out meetings, or to schedule events. These matters cannot be eliminated altogether however, meticulously planned informal networking between the top team enhances efficiency of leaders to a great extent.

Each member of the C-level should connect the right people together, lead and support subgroups, and maintain associations. Gaps in informal communication between leaders damage the implementation of organizational strategic plans. Interaction between top executives is often limited to participation in senior level meetings for information sharing purposes only, lacking collaboration to pursue shared objectives. To make matters worse, they spend too little a time with their direct reports, employees, or customers. This detachment creates widespread unease and skepticism.

Interested in learning more about the 3 key principles necessary to design a Leadership Operating Model? You can download an editable PowerPoint on 3 principles key to design a Leadership Operating Model here on the Flevy documents marketplace.

Do You Find Value in This Framework?

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“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd
February 1, 2022
3 Pillars of Product Launch Strategy
Mature markets, where the customer base begins to stagnate, call for structured Organic Growth founded on a superior Customer Value Proposition (CVP). CVP encompasses all that is gained by customers for the money they pay—material as well as intangible. Customer Value can be articulated by the equation:
```
Customer Value = (Product Performance + Service Delivered + Image) / Price Paid
```
CVP endeavors can be lacking due to many reasons such as use of incorrect Research Method, misapplication of a correct statistical method, incorrect interpretation of research outcomes in the background of current brand position, market situations, or capabilities system of the company.

Crafting an effective CVP requires insight and experience, but the probabilities of realization escalate by applying a structured process. Organizations that defy odds and repeatedly thrive with many new-product unveilings lean towards applying a disciplined approach to developing their CVP. The approach that these organizations follow comprises of 3 distinct practices, blending creative inventiveness and analysis. The 3 Pillars of Product Launch Strategy are:
1. Market-backed Analysis
2. Darwinian Competitive Review
3. Capabilities-Forward Assessment
Each of the 3 practices has the two-fold effect of being an idea generator as well as an idea sifter.

The practices produce fresh thoughts regarding trends for growth and also assist in determining the products and services to launch and the way to position them.

Let us go a little further into details of each pillar.

Market-Backed Analysis

Market Research merely queries consumers regarding their attitudes, inclinations, and aversions. Real focus of such research should be on comprehending behavior; such as the trade-offs consumers make when deliberating a purchase. Market-Backed Analysis is a method of collecting consumer insights that isolates the value imputed by consumers to various components of a product or service, and generates practical information as a consequence.

Darwinian Competitive Review (DCR)

Executives are always on the lookout for new product and service innovations that can distinguish their companies. New ideas are always more exciting than an innovation that the industry has already introduced. Darwinian Competitive Review suggests that even a new idea must follow some demonstrated Value Proposition—i.e., proven success somewhere else. DCR calls for scrutiny of those Customer Value Propositions that have exhibited success across several markets, and of competitors who have already instituted themselves in those markets.

Capabilities-Forward Assessment

Capabilities-Forward Assessment is a thorough evaluation of what the company already does skillfully, and which novel Value Propositions its Capabilities System will be able to sustain. Possessing the correct Distinctive Capabilities that are aligned can be the difference between being common place and being great. An example of the above would be the difference between offering a product at low cost and at the lowest cost.

Interested in learning more about the 3 Pillars of Product Launch Strategy? You can download an editable PowerPoint on 3 Pillars of Product Launch Strategy here on the Flevy documents marketplace.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd
January 31, 2022
Fit for Growth
A question faced by many business leaders in today’s dynamic, uncertain, and changing business environment is: Is our organization “Fit for Growth?” In most cases, unfortunately, the answer to this question is “no.” Reasons include the manner in which costs are managed and resources deployed.

The fundamental question needed to be asked is: how to assess whether the organization is Fit for Growth? Such an assessment is effortlessly possible through answering the following 3 questions:
1. Does the company have well-defined Strategic Priorities that concentrate on strategic growth and which direct its investments?
2. Do the company costs align with the Strategic Priorities? i.e., efficient and effective employment of resources toward the Priorities.
3. Does the Organizational Structure enable achievement of those Strategic Priorities?
Imagining the converse side of these queries makes the picture clearer. That is, what are the consequences of: Not having clear Priorities, Inappropriate deployment of Costs, Not having a well-designed organization.

Positioning the company to be Fit for Growth requires basing it on the following 3 pillars of Growth:
Setting the company on the 3 pillars enables it to direct investments towards the Capabilities that are most crucial and reduce—or eradicate—other costs.

Let us delve a little deeper into the details of these 3 pillars.

Strategic Priorities

Numerous warning indicators are apparent if the Strategic Growth Priorities of a company are not crystalized.

Warning signs such as being unable to keep track of the numerous initiatives that the company has going at the same time.

Senior executives of the company attending lots of unrelated meetings in a day. Executives being divergent on the most important capabilities of the company and how they relate to the strategic objectives.

Areas that can distinguish the company from its competitors not being properly invested in.

Research has established an important correlation between Capabilities and Strategy. Capabilities require lots of attention and investment because of their cross-functional effect and limited number.

It is therefore, needed to have clear Priority regarding which Capabilities to invest in.

Cost Structure

Inappropriate Costs Structure is also an indicator of incorrect priorities, particularly the amount spent on non-essentials.

Organizations aiming to be Fit for Growth make themselves lean and expend money purposefully. They can maintain their commanding position in such Cost Transformations by pursuing the 12 principles.

Costs are managed for efficiency as well as effectiveness using tools and practices that are usually grouped into 3 categories.

Growth

Organizations, over time, become slow in reacting to opportunities and do not move quickly enough, or are not in-line enough to work in unison. These are common manifestations, even in organizations that are run and managed well.

Interested in learning more about Fit for Growth? You can download an editable PowerPoint on Fit for Growth here on the Flevy documents marketplace.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd
January 24, 2022
Capabilities-driven M&A
Mergers and Acquisitions (M&A) generally do not produce the outstanding results that they are envisioned and purported to provide. Some companies in certain industries, however, demonstrate consistent success when it comes to M&A.

A constant question across all industries, as far as M&As are concerned, pertains to the factors that differentiate organizations with successful histories. The magic ingredient in the success of these companies is their Corporate Strategy that utilizes Capabilities as the source for inorganic Growth. Capabilities-driven M&A have managed to raise shareholder value for the acquirer despite the tough years since the economic crisis of the 2000s. The majority of other inorganic Growth attempts produced a loss of value.

Companies employing the Capabilities-driven Strategy were recompensed with deals that had a Compound Annual Growth Rate (CAGR) average of 12 percentage points greater in shareholder return compared to M&A deals by other acquirers in that very industry and region.

Particular industries, for instance Information Technology and Retail, demonstrated a bigger effect. However, all industries displayed a steady, noticeable, Capabilities Premium in M&A. Capabilities-driven Strategy is exceptionally beneficial in M&A transactions where, frequently, time window is narrow and the risks elevated.

Capabilities Systems are defined as 3 to 6 reciprocally strengthening, distinguished Capabilities that are structured to hold up and drive Organizational Strategy, integrating people, processes, and technologies to create something of value for customers.

Setting apart likely M&A success factors is accomplished more easily by separating successful deals by their declared Intent consequently, capturing the dominant view regarding purpose of each deal.

Intent can be classified into 5 categories: Capability Access Deals, Product and Category Adjacency Deals, Geographic Adjacency Deals, Consolidation Deals, and Diversification Deals.

There is a lot of talk about Fit during M&A discussions. Fit does not mean introducing an ostensibly linked product or service, plugging a gap in a category, or moving in a new geography—such sorts of acquisitions are frequently unsuccessful.

Fit relates to unity, the benefit that ensues when Capabilities of a company fit mutually into a system, lining up to its market position, and employed to its complete array of products and services.

Deals when cross-categorized by their Capabilities System Fit, fall into following 3 categories:
1. Enhancement Deals
2. Leverage Deals
3. Limited-Fit Deals
Let us delve a little deeper into the 3 categories.

Enhancement Deals

Enhancement deals enable the acquiring company to include new Capabilities so as to close gaps in its present Capabilities System or counter an alteration in its market.

Nearly 2/3^rd of the deals studied—in a 2011 study spanning 8 sectors—used Capabilities to good effect, either by way of Enhancement or Leverage.

Leverage Deals

Leverage deals are where the acquirer makes use of prevailing Capabilities System in their company to handle incoming products and services, customarily augmenting the acquired company’s performance.

Leverage deal are frequently low-risk deals that may not require the acquirer to alter anything concerning its inhouse Capabilities System to make it work.

Limited Fit Deals

Limited-fit deals are deals where the purchasing company generally ignores Capabilities. Normally such deals provide a purchaser with product or service that need new Capabilities.

Interested in learning more about Capabilities-driven M&A? You can download an editable PowerPoint on Capabilities-driven M&A here on the Flevy documents marketplace.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd
January 11, 2022
6 Rs of Behavioral Change
Business Transformation initiatives are typically undertaken to solve a pressing issue, bring about improved performance, or to serve customers better. A critical element of the success of such initiatives entails transforming the existing behaviors of the employees across the organization. However, this isn’t a straightforward task.

Attitudes and practices get reinforced in people by following established routines day in and day out. Such practices become a part of an Organizational Culture over time. Ingrained organizational behaviors and practices aren’t considered burdening until the organization’s performance starts declining considerably over time. That’s when the leaders start thinking about changing these beliefs and habitual actions.

Psychology and Neuroscience can help enterprises change the deeply embedded attitudes and practices of people and replace those with new beliefs and practices. Leading organizations are using psychology and brain research to induce successful change. Specifically, they focus on the right priorities to enable Organizational and Behavioral Change and take the following 6 steps—or 6 Rs of Behavioral Change:
1. Recognize
2. Relabel
3. Reflect
4. Refocus
5. Respond
6. Revalue
Let’s dive deeper into the first 3 steps critical to render behavioral change.

Step 1 – Recognize

The first step involves the leadership reflecting on the behaviors that are required to be transformed. Leaders are responsible for articulating the future vision of an organization, prioritizing and implementing initiatives to achieve the vision, and take measures to tackle disruption caused by technology and rivals. Self-Reflection on undesired behaviors by role models (including senior leaders) is essential to make other people ponder over their behaviors.

Leadership behaviors inform the workforce about the Transformation required, assist in championing the agenda, and make these behaviors resonate across the board. Individuals, in turn, should contemplate on the alignment of their behaviors with their personal / organizational goals, think of new improved ways of doing things, and dump convenient yet unproductive behaviors.

Step 2 – Relabel

The 2^nd step of the 6 Rs to Organizational Change necessitates categorizing and naming the flawed or unfit behaviors. Neuroscience research has revealed that by naming behaviors and understanding that thoughts are merely ideas, persons with Obsessive Compulsive Disorder can disregard useless thoughts and behaviors that trigger them to wash their hands again and again.

Relabeling thoughts allows individuals to stop reflecting on useless thoughts. Likewise, in an organizational setting leadership needs to evaluate which shared thoughts don’t work well, categorize them, and communicate the reasons for their unsuitability across the organization.

Step 3 – Reflect

In this step, senior management replaces outdated beliefs and behaviors and outlines the vision or desired objectives and behaviors. The outlined desired objectives and behaviors need to be explicit, translated into daily actions, and attractive to the people. This may warrant training of people to reflect on the desired expectations and behaviors collectively. Effective communication of benefits of altered objectives and behaviors assists in subsiding the unrest associated with change in people and relaxing their mind and thoughts. This must include informing people that uncertainties are part of business and that they should keep their focus on organizational values and what matters most during change. Reflection creates a sense of ownership among employees that is otherwise difficult to be achieved by any cascaded top-to-bottom directives.

Interested in learning more about the other steps or Rs critical to engender Change ? You can download an editable PowerPoint on 6 Rs to Behavioral Change here on the Flevy documents marketplace.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd
December 4, 2021
Neuroscience of Change
Business Transformation initiatives are typically undertaken to solve a pressing issue, bring about improved performance, or to serve customers better. A critical element of the success of such initiatives entails transforming the existing behaviors of the employees across the organization. However, this isn’t a straightforward task.

Attitudes and practices get reinforced in people by following established routines day in and day out. Such practices become a part of an Organizational Culture over time. These ingrained behaviors and practices aren’t considered burdening until the organization’s performance keeps declining considerably over time. That’s when the leaders think about changing these beliefs and habitual actions.

Psychology and Neuroscience can help enterprises change the deeply embedded attitudes and practices of people and replace those with new beliefs and practices. Leading organizations are using psychology and brain research to induce successful Organizational Transformation.

The practices that these organizations employ to engender Transformation are based on the following 6 core Principles of Neuroscience:
1. The brain is hardwired to hold on to habits, making it difficult to change them.
2. Connections in the brain—even deeply embedded thoughts—are quite flexible to transform.
3. Concentrating on new ways of thinking can overhaul individuals thinking habits.
4. Don’t tell people what is wrong, just focus on drawing their attention to the positives.
5. Encourage the ability to reject negative cerebral impulses.
6. The competence to focus attention has to be created bit by bit.
Let’s dive deeper into these first 3 principles of Neuroscience.

Principle 1 – The brain is hardwired to hold on to habits, making it difficult to change them.

Our thinking patterns are stored in circuits by brain parts—including the habit center (basal ganglia), amygdala (emotion center), and hypothalamus (which manages hunger, thirst etc.). These brain parts, especially the basal ganglia, process info unconsciously and the activity feels rewarding to the individual. This activity makes stronger neuronal connections with other areas and gets the activity reinforced.

For the desired behaviors and practices to get embedded, the organization need to make stronger connections with the entire workforce’s’ basal ganglia to enable deep rooted neuronal circuits. The practices ingrained this way are difficult to remove.

Principle 2 – Connections in the brain—even deeply embedded thoughts—are quite flexible to transform.

People with obsessive compulsive disorder keep deliberating on their impulse to wash hands to ensure cleanliness. This fortifies brain circuits in the basal ganglia, which takes over their behaviors. However, Neuroscience reveals that even the most well-established notions can be altered. This can be done by making the individuals aware of what they are thinking and where their focus is in a given moment.

Training and directing people to think about their thoughts can make them conscious of their undesired behaviors, disengages brain areas notable for causing distraction, and adopt new behaviors.

Principle 3 – Concentrating on new ways of thinking can overhaul individuals thinking habits.

The 3^rd principle highlights that persistent focus on unfamiliar, desired thoughts and objectives activates the habit center of the brain, which turns these desired thoughts into habits. The mechanism according to Neuroscience is such that basal ganglia’s caudate nucleus region processes…

Interested in learning more about the other principles of Behavioral Transformation? You can download an editable PowerPoint on 6 Core Principles of Neuroscience here on the Flevy documents marketplace.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library. FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd
December 1, 2021
7 Principles of Culture Change
Employee behaviors are critical for the success of Business Transformation endeavors. However, transforming the ingrained behaviors and mindsets of the workforce isn’t straightforward, and when tackled cause the enterprise’s emotional state to go down.

Leaders need to identify the components of Culture that are in line with their Corporate Strategy. They have to ascertain and harness the positive elements of culture that can drive the desired Transformation and suppress those that obstruct it.

For the desired Organizational Culture to sustain, leaders should work on gaining acceptance of the transformed behaviors. Leaders who do not give culture its due importance risk ruining their strategic endeavors, as they lack the commitment required from the employees to achieve success.

The real question is why senior leaders fail to use the positive elements of Organizational Culture constructively in the first place. The answer is simple; there are 4 common yet wrong assumptions—or myths—regarding culture change that are deeply established in most businesses that are anything but facts. Paying heed to—and acting on—these 4 myths results in grave consequences:
1. Culture is the root cause of all our failures
2. Changing our Organizational Culture is beyond us, forget about it
3. Let Human Resources deal with Organizational Culture
4. Culture is the responsibility of top management
When senior executives devise a strategy to transform the deeply entrenched organizational culture—by putting in place new policies, practices, reward structures, and performance management systems—there is strong resistance that outplays the strategy.

This is primarily due to employees’ reservations and uncertainties regarding the impact of these changes on their work, colleagues, atmosphere, routines, family, and their enterprise’s reputation. Transforming the Organizational Culture using the individual’s actions and conduct necessitates seeking assistance from 7 guiding principles:
1. Be Practical
2. Reinforce New Behaviors
3. Seek Out Role Models
4. Identify Cultural Carriers
5. Leverage Existing Culture
6. Be a Role Model
7. Explain Impact of New Behavior
Application of these guiding principles facilitates in transpiring successful culture change. Let’s dive deeper into a few of these guiding principles.

Be Practical

The first guiding principle to changing the culture involves starting rationally and pragmatically. It is not feasible to strive to change every behavior at once. Leaders need to concentrate on the behaviors most critical for the organization.   The ones that reverberate with the existing company culture and have a key role in improving the organizational performance. This entails ascertaining groups of employees whose behaviors should be transformed immediately. A clear demonstration of the requisite changes goes a long way in reinforcing the desired behaviors and culture in the organization.

Reinforce New Behaviors

The 2^nd principle to changing culture involves emphasizing new behaviors. The desired behaviors should be reinforced using formal and informal mechanisms. Formal reinforcement mechanisms include metrics, processes, appraisals, salary reviews, training, and incentives to reward new behaviors. These formal mechanisms allow people to practice new behaviors repetitively, until they begin to realize their value. Informal reinforcement mechanisms include support networks and associations to nurture sensitivity and devotion needed to cope with uncertainties.

Seek out Role Models

Organizational Culture Transformation necessitates distinguishing role models to demonstrate the desired behaviors. Culture change begins when change practitioners act by modeling the new behaviors. These change practitioners are pride builders for an organization. The examples set by these practitioners assist in inculcating pride in others about embracing the desired behaviors. This action is referred to as “positive deviance” or constructive non-conformity. These pride builders in turn identify and develop more exemplars.

Interested in learning more about the other guiding principles of culture change?  You can download an editable PowerPoint on 7 Guiding Principles of Culture Change here on the Flevy documents marketplace.

Do You Find Value in This Framework?

You can download in-depth presentations on this and hundreds of similar business frameworks from the FlevyPro Library.  FlevyPro is trusted and utilized by 1000s of management consultants and corporate executives. Here’s what some have to say:

“My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me in a fraction of the time and money of other solutions. I strongly recommend FlevyPro to any consultant serious about success.”

– Bill Branson, Founder at Strategic Business Architects

“As a niche strategic consulting firm, Flevy and FlevyPro frameworks and documents are an on-going reference to help us structure our findings and recommendations to our clients as well as improve their clarity, strength, and visual power. For us, it is an invaluable resource to increase our impact and value.”

– David Coloma, Consulting Area Manager at Cynertia Consulting

“FlevyPro has been a brilliant resource for me, as an independent growth consultant, to access a vast knowledge bank of presentations to support my work with clients. In terms of RoI, the value I received from the very first presentation I downloaded paid for my subscription many times over! The quality of the decks available allows me to punch way above my weight – it’s like having the resources of a Big 4 consultancy at your fingertips at a microscopic fraction of the overhead.”

– Roderick Cameron, Founding Partner at SGFE Ltd
November 24, 2021