Reflections on Successful Organizations

We've been speaking at conferences a fair bit lately, on key topics for senior leaders. Strategy, Leadership, Risk, Governance. And we've been working with a lot of Boards and senior management teams lately to tamp down risks on a number of levels. 

We've been thinking a fair bit about the interplay between Strategy, Risk, Governance and Execution. These are the four critical levers that virtually all succesful firms have got a firm grip on. Each of them alone can put you asunder, but you're not firing on all cylinders until you've got them well aligned.  Some examples based on some really newsworthy topics:

  • Blackberry - lots can be said here, but their complex governance (two co-CEOs and the propensity fo the Board to let the co-CEOs run with things), clealryt didn't help. The strategy was wrong too - they spent a lot of time and money on acquisitions and projects to make their devices better - but clearly not better enough, or fast enough. While lots can be said, we're crossing our fingers that they are able under their new CEO John Chen to dig out of a very deep hole and become relevant again.  
  • JP Morgan - undoubtedly on so many levels an excellent company, and yet they still booked a loss with fines and penalties of approximately $20B (yes billion) for misdeeds arising from a number of causes. At some point these losses simply have to be part of what gets your attention. They remain an advocate of a shared CEO/Board Chair role (Jamie Dimon), which Canadian Regulators (OSFI) have indicated to be an undesireable practice. Good governance can be hard.

So this article is titled Reflections on Successful Organizations.  And there are lots. But they are companies you rarely hear about as having these kinds of complex problems.

IBM works in some of the most challenging domains - at the centre of a continuously evolving vortex of technology - and yet it's got these four tenets nailed. When things go wrong (they do), they have processes to identify and deal with them early.  It's not always pleasant, but it is important. 

In Ontario, the Ontario Lottery and Gaming Corporation (OLG) has recently got great press from a signature event - hunting down a lottery ticket winner who lost her ticket and didn't know she had won. This from an organization that not so long ago had its board fired for complex reasons.  It was also in the wake of a scandal in which lottery ticket vendors seemed to be beating the odds of lotteries.  Those problems seem fixed, and there has been a lot of hard work to make sure that real ticket owners are the ones who collect the prizes.  

Ford Motor Company and General Motors are both coming back from diificult phases a few years ago, and most optiimstically, they're doing it with winning products, not fancy strategies, like financing. 

So some succesful companies you hear about, and some you don't. But they all have a firm grip on the four key levers. And some of them had their own issues some years back, but they've recovered.  We're crossing our fingers for Blackberry, are pretty sure about JP Morgan, but are looking to learn what we can from their (and others mis-steps) and recoveries along the way.

Have you nailed the four levers? They are equally important in smaller and medium sized companies as they are in big companies, and in some ways maybe more so.