About 120 of your top managers have gathered in the ballroom of a hotel in an exotic location. It's your annual conference and you have a strategic roadmap to share. Your organization's head of strategy has worked long hours with you to ensure that the messaging is just right. Finally your chief marketing officer and your advertising agency has put together a presentation that is visually rich. Now it's your turn, as a chief executive, to deliver the speech and get 120 people aligned behind your strategy and inspired to make it work.
You had practiced your speech and that along with the powerful presentation was a big hit. Many in the audience said so post the speech and during the evening celebrations. This was perhaps the most number of acknowledgments you have received for any of the annual strategy roadmap presentations you have made over the years.
Two weeks later the euphoria of a fabulous conference is over, you're at a regional meeting where 15 of the managers who attended the conference are present. You do a random check to see how many of them have remembered the strategic road map and understood how it applies to them. What percentage got them right? Well, if two or more got it, you have beaten the odds. The average percentage of people across companies, across geographies who get the question "what is your company strategy?" right is about 5%. In the book The Strategy-Focused Organization, Robert Kaplan and David Norton note that, according to an abundance of research data, on an average only 5% of the workforce understand their company's strategy.
On an average only 5% of the workforce understand their company's strategy.
So how can you make strategies stick? For sure, visually rich PowerPoint presentation slides with bullet points and charts is not the answer. To explore what the answer may be we first need to try and understand why current methods of presentations, road shows, cascades don’t seem to work. The answer lies in a phenomenon called the curse of knowledge, as illustrated brilliantly in an experiment by a Stanford University graduate student named Elizabeth Newton in 1990. Elizabeth took 240 students and divided them into two groups. One group played the role of 'tappers' and the other group 'listeners'. Each tapper was given a well-known English song such 'Jingle Bells', and their job was to tap out the rhythm on a table. The listener's job was to guess the song. They were set into pairs and the experiment began.
At the end of the experiment the tappers were asked to predict the probability that their listening partner guessed correctly. The average prediction was 50%. The reality was that the listeners guessed correctly only 2.5% of the time. Why did this happen? The curse of knowledge. When the tune is playing in the tapper's head the tapping seems to be a perfect match, but for the listener who does not have the tune in her head it sounds like noise. But the tappers are usually shocked about how difficult it was for the listeners to get it right.
The challenge is that once we know something - like the tune of a song - we find it hard to imagine not knowing it. Our knowledge has "cursed" us.
Just like tappers and listeners, in the business world the provider of the strategy message (you) and the receivers (your employees) are perhaps in a situation of information asymmetry. The tune (understanding of the strategy) in your head is difficult to understand through the tapping (bullet points) on a PowerPoint slide.
This is where narratives can come to the rescue. In our practice we call it clarity stories. In our Making Strategy Stick programme we work with chief executives such as yourself, and those who report to you and take key messages like strategy, vision, mission and change management through a journey which results is a strategy story or a vision or mission or change management narrative, as the case may be.
The narrative usually begins with stating the purpose why the company was formed. It then talks about what the company did because of this purpose and the results it got. But then something changed, there were some turning points that necessitated our doing something different now (our strategy). Finally the narrative ends by painting a picture of the future, of what success will look like to people within the company and without. We then train the team to be able to tell this story orally - after all, that is how stories are best told.
There are several advantages of this process. Everyone uses the same narrative structure or skeleton when talking about the strategy. Sharing strategy is no longer subjected to the interpretation of various senior members of the team. Whether you, the chief executive, is addressing the annual conference today or your chief financial officer is having a regional finance heads meet or your chief marketing officer is addressing all marketing and agency personnel, they are using the same narrative structure and hence there is consistency.
Consistency, a critical element in messages sticking, is the first advantage. Though everyone is using the same narrative structure, we teach them to all find personal experiences and anecdotes to illustrate parts of the narrative. This brings richness to the tapestry of the story.
The second advantage is what we have been after - the ability of listeners to relate to a story. Because stories allow us to visualize, imagine and relate, because stories make the abstract concrete, stories connect and stories stick.
Because stories allow us to visualize, imagine and relate, stories connect and stories stick.
The third advantage for me is the most powerful - stories can be retold. No matter how clear your message is, and how simple it is to understand, there are only a limited number of occasions, be it one-to-one or one-to-many for you (or your team) to personally narrate the strategic story to your employees. However, a story well told is easy to retell and this strategic story can be retold by people who you tell the story to. They in turn can tell it to others. Finally, we have a cascade that works. And your strategy sticks.
[This article appeared concurrently in Mint]