The following article originally appeared in the October newsletter to clients of Kiley Advisors, LLC. Reprinted with permission.
Every CEO and senior executive has, as a major part of their responsibilities, the obligation to set the strategic direction for their organization so that it has a deliberately designed future – one that is believable and desirable. They also have the obligation to lead their organization toward that future, acquiring the necessary resources and making the critical changes.
Strategy, simply defined by the reigning guru Michael Porter of the Center for Strategy and Competitiveness at Harvard, is what an organization faced with competition does to gain a sustainable completive advantage in the markets. It is how it puts resources at risk to provide more value, or a different value than competitors, to a targeted group of customers within target market segments. It becomes in essence “What” the company does.
In the older models, that always was the first consideration: figure out what you are going to do and then go get all the resources to do it, including (hopefully) the right people. We still see this periodically in the construction industry – a desperate company will race out and get a project, often by being very low, then race to raid a superintendent and project manager with the right experience. There are many examples of this, even in major public venues.
But the findings of researcher Jim Collins, in his seminal work Good to Great, clearly proved that companies that moved from good to great all had in common that people came before strategy. In other words, “Who” before “What.” He talks of having the right people on the bus, and in the right seats, and, equally important, the wrong people off the bus, as the critical key decisions in determining in which direction the bus should travel.
Most successful construction companies follow this approach as they realize the only thing that can truly differentiate them and give them a real competitive advantage is their people. Consequently, the CEOs and senior executives in these companies spend a significant amount of time on building a culture that systematically attracts, retains, develops, recognizes and rewards talent. Then they involve them in setting the strategic direction for the company. It is amazing “What” can be achieved, with the right “Who.” Talent trumps all!
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