The Primary Functions of Management

It occurred to me recently that there are really three essential functions of management.

Strategy: setting a direction for your organization.

Alignment: getting organizational resources lined up to execute the strategy.

Execution: delivering expected results as part of the fulfillment of your strategy.

One might argue that there are many more functions of management, but I think it is helpful to understand that these three are the primary and in fact essential functions, and that all the other things managers do must be understood to support one or more of these three functions.

Let’s take a look, then, at the essential nature of these three functions.

Strategy

A strategy defines an approach for delivering superior value to your customers. A strategy must answer the following questions:

  • Who are our future customers?
  • How can we provide them with greater value than they have today?
  • How can we provide them with greater value than that available from our competitors?
  • What is our approach? What makes us think it will work?
  • What do we expect to achieve?
  • What resources will we need in order to execute the strategy?

If you don’t have well researched and reasoned answers to all of the questions above, then at best you have an incomplete strategy, and at worst you have no strategy at all.

Note that an aspirational use of superlatives should not be confused with a strategy: saying that you are going to be the greatest little xyz in the land is a nice sentiment, but meaningless in the strategy department.

Strategies can and should exist at many levels of the organization, so long as the strategies are consistent with one another. Note, though, that each strategy must exist at the top of an organization; so while it is fashionable in business today to say that leadership is everywhere, and we are all leaders, we should not all be setting strategy, for if everyone is left to devise their own strategy, then the the organization has no strategy at all.

Strategy requires a leader to look forward into the future, since any successful strategy must anticipate emerging opportunities, changes in customer demographics and desires, and evolving capabilities of the competition.

We must also understand that strategies grow stale over time, as business conditions change, as new competitors emerge, and as customer interests evolve.

If we understand strategy as described above, then it should be clear that strategy is essential: otherwise your organization is like a ship without a captain to set its course, and such a ship is much more likely to founder upon the rocks than to reach any desirable destination.

Alignment

Organizational alignment to the strategy is the necessary next step in achieving desirable results; organizational resources, in terms of dollars, hours and energy, must be focused on the various elements of your strategy. In practice, this usually means that expenditure of these scarce resources in other areas must stop, in order to bring your strategy to fruition.

Alignment is the function that falls primarily on the shoulders of middle management; in fact, this is what we generally mean by middle management, for these are the people who have strategy set above them, and execution resources operating below them, so it is their job to communicate the strategy, and make sure that operational resources are working in alignment to those strategies.

It would be a mistake, though, to think that a particular level on an org chart is limited to performing a particular function. For one, it is often the role of top executives to help align those in the organization to a dramatic new strategy. And it is often the case as well that it may fall to the shoulders of many levels of management to devise a strategy for success within their own corners of the organization (one that is, of course, in alignment with higher-level strategies).

In order to achieve alignment, a manager must do all of the following.

  • Understand the strategy;
  • Communicate the strategy, not just as handed down in stone from on high, but by putting it into words and concepts meaningful to those receiving the communication;
  • Understand where resources are currently misaligned;
  • Take whatever means are necessary to bring resources into alignment with the strategy.

Note that alignment is often difficult and risky work. As one example, see this captivating YouTube video of Steve Jobs at the 1997 Apple World Wide Developers Convention, working to bring Apple developers into alignment with the company’s new strategy. Or, for that matter, see this video showing how Bo Schembechler brought his defensive captain onboard with his strategy for the 1980 Michigan football team.

Execution

Once resources are aligned with the strategy, then those resources must perform their particular organizational functions efficiently and effectively.

Unlike strategy, which is forward-looking, execution requires a tactical focus on the people, materials, methods and tools at work in the current timeframe.

Some Useful Observations

  1. If you are not seeing the results you would like in some part of your organization, then it is worth asking whether the problems primarily stem from a flawed strategy, lack of alignment to that strategy, or to poor execution. If your strategy is poor, or if your resources are not aligned to your strategy, then improved execution probably won’t help.

  2. If you are unsure whether a certain decision has to do with elements of strategy, then ask yourself whether that decision affects your resource allocation. If a decision requires you to acquire or get rid of resources, or to change the types of resources you are using, or to reassign resources to a different statement of work, then it is probably a decision that involves some elements of strategy.

  3. As a manager, at any level of an organization, you always need to maintain an awareness of which function you are being called upon to perform in any situation. If a strategy has been set at a higher level, then it is part of your job to align resources to that strategy (or to convince your leadership that they should adopt a better strategy).

September 8, 2014

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