How Credit Unions Can Create Strategic Alignment

Nothing frustrates a CEO more than having an executive team that is strategically, operationally and culturally divided. A Harvard Business Review study, “The New Game Plan for Strategic Planning,” found that 84% of respondents ranked “management alignment” as the most important task. However, just 41% indicated their organization performed well in that area. What is missing from that survey is the alignment between management and their boards, amongst board members, and between management and staff, which are all primary concerns for attentive CEOs. With so many areas in need of alignment, which relationship do you attend to first? In practice, there is not one standard starting position. The answer is informed by context. However, one thing proves true at every organization, strategic alignment is a temporary phenomenon.

Opportunities to Align Are Continuous

Achieving strategic alignment, regardless of the population(s), is no easy task. It requires an investment of time, energy, and, oftentimes, is as emotionally taxing as it is rewarding. However, that alignment will eventually be tested with unknown variables, different players and new options; alignment is temporary. The opportunity for credit union leaders is to regularly assess and reveal the degrees of strategic alignment throughout the organization (board, CEO, C-suite, mid-level leaders and staff). There are always going to be opportunities to enhance that alignment. The more aligned an organization is, the less friction and wasted effort. In other words, aligned organizations tend to be higher performing, more efficient and capable of delivering better internal and external experiences for their members.

Assessment Instruments Can Help

Applying the adage, “What gets measured, gets done” to organizational strategic alignment creates an objective requirement to a nuanced and subjective reality. One high-performing, billion-dollar credit union found that, although plenty of things were going right, they knew they had not reached their full potential as an organization. Efficiency of execution required new levels of cross-functional coordination. The credit union could have employed a number of discovery options including conducting 1:1 interviews, facilitating small-group conversations, or deploying an ad-hoc team to uncover the low-hanging fruit and big rocks to move that would take the organization to the next level. However, time was of the essence. They chose to deploy an organization alignment assessment, an instrument that quickly, easily and objectively measured the degrees of alignment on strategy, infrastructure, operations, culture and pace of execution within various populations.

One of the key awakenings for the team was that 26% of the organization’s top two layers straight-up disagreed that they were aligned about strategic priorities. In fact, only 9% strongly agreed that they were aligned. Most respondents were middle of the road. To say the least, the CEO was surprised. After visually seeing the lack of alignment and discussing opportunities, the team, together, recognized that finger pointing was no longer a solution; they, not just the CEO, were accountable for the lack of alignment. They had skin in the organization alignment game.

Working Toward Alignment, Together

The CEO was more excited to witness that volition generated than reading an executive summary report with prescribed next action steps. The group reviewed the rest of the OAA’s results regarding organizational core competencies, competitive advantages and strategic direction. It was not that they did not have a direction or that some did not know the core competencies … they all were not aligned on precisely what they were, could be, or, more importantly, needed to be – which fragmented resource allocation, delayed execution and created more jockeying for prioritization. The organization was not fulfilling its potential … not to mention the headache factor. One of the outcomes of the OAA review conversation was a comprehensive development, with a high degree of clarity and buy-in, of the strategic framework that will guide and inform alignment conversations for years to come. The team has since established high-quality internal partnerships so that, when new variables are introduced, they can seek alignment. Measuring their organizational alignment annually is as validating as it is informative. Identifying where they are not aligned is no longer a touchy subject, it is a pragmatic opportunity.

The Journey Continues

Aligning an organization is a task of a different kind. It is less of a destination and more a regular practice for your journey; like preparing for a road trip. Strategically, you’ve identified where you’re going, who’s going with you and when you need to arrive. Operationally, you’ve filled the gas tank, mapped the route and inflated the tires. Culturally, you’ve identified the playlist (a little something for everyone) and packed appropriate snacks. Pace-wise, you’re going to be in a rush, or you’ll take it easy. Most organizations focus on a combination of those factors, and attending to all of them increases the likelihood of success (e.g., arriving safely, on time and not hangry).

Arguably, nothing is more satisfying than having a strategically aligned organization.

Peter Myers is SVP for DDJ Myers, an ALM First Company, in Phoenix, Ariz.