Operating States Required for an Organization to Achieve Peak Performance
Every CEO I coach desires to lead a peak-performing organization. Through the coaching process, we uncover the challenges that constrain their vision from becoming a reality. The constraints inhibiting catalyzation most often result from a lack of focus on formulation. As a fellow Maverick on the Predictive Index, I get it. Setting the foundation and building infrastructure for highly creative and driven people is tedious and nowhere near as rewarding as bringing in the deals and ideating new sources of revenue. Quite often, it takes a catalyzing event such as COVID-19 to shine the light on the organizational fractures in the way of achieving peak performance and organizational momentum.
Whether it is a wrong hire in a key role, a lack of accountability, or a bifurcated vision, these impediments become giant obstacles in times of crisis, change, and uncertainty. If you want to lead your team through this pandemic and to high performance, it is important to first understand the basics of Organizational Effectiveness and the building blocks required to go from one operating state to the next. When you have the outline for an organizational road-map, you are more equipped to get from where you are to where you want to go.
There are seven progressive operating states, and when operating in these states, the organization is moving forward. These states are Formulation, Concentration, Low Momentum, High Momentum, Breakthrough, Stability, and Mastery. The two operating states that emerge during times of crisis, maybe even right now, are Emergency and Danger.
Formulation is the Operating State where the business or project is established after the research is complete and needs are assessed and understood. In this stage of forming, you are laying the foundation for success. This Operating State requires you as the Leader to enroll the collective in the vision and how the customer will benefit when the vision becomes a reality. During this Operating State, the Leader announces what’s going to be accomplished in terms of how the world will be changed and with certainty declares specific measurable results. A key part of building the foundation is selecting the right team members, defining who owns what, how communication flows, and who reports to whom. A budget, performance milestones, and check-ins are built and shared to support the team in achieving the desired outcome. Results may occur in Formulation but are not predictable in this Operating State.
Concentration is the second progressive organizational Operating State. In Concentration it often feels like you are working against inertia; people are working hard, and it shows. Intentionality and intensity coupled with precision and focus keep the team moving forward and grinding out results. The ratio of effort to result is 20:1. It is important to know that nothing is wrong in Concentration, this is what it looks and feels like to accelerate. Trust is imperative to the norming state of Concentration. Establishing and maintaining a strong relationship to your WORD, by making and keeping promises is the only way to build and keep trust. The key to moving from Concentration to Momentum is tightening the personal and collective discipline and economizing where and whenever possible. Resilience, humility, and rigorous compassion are table stakes for leading people through and beyond the Operating State of Concentration.
LOW MOMENTUM and HIGH MOMENTUM
Your organization is in the Operating State of Momentum when you are producing consistent and predictable results. Even though your organization is moving forward to achieve an even higher level of momentum, you need to take a step back and see that the team is okay. If not, cleaning up any residual blood, sweat, and tears is required. Acknowledgment for overcoming obstacles and achieving success is the fuel that motivates and engages both the individual as well as the collective. In Momentum, the boxed-in energy of Concentration releases, and people have more emotional space to create, collaborate, and stretch. Intention, intensity, and focus are the standards through low and high Momentum. A grounded leader is key to how well the team navigates and accelerates from low to high Momentum. Integrity of word, process, and discipline is the foundation for the accelerated growth you experience. In low Momentum, the ratio of effort to result is 10:1. In high Momentum, performance optimizes and the ratio of effort to result is 3:1. Spontaneity, humor, and innovation excel. It's a good idea to bring more team members in and expand participation, measure everything that matters, and create dashboards that people use. To continue moving forward with velocity, management must be active and engaged. In high Momentum, more management of the project is required. The vision needs to be communicated often and people need clear direction and focus. Points of leverage need to be optimized, delegation must get stronger and integrity must remain high. In high Momentum, team members shift from having their objectives imposed on them to co-creating and aligning on objectives.
Breakthrough is the Operating State where a sudden, unexpected, and unpredictable high-reaching result is achieved. It is important during the Breakthrough state that people keep their word, integrity remains a cornerstone and that no one messes with what is working. In the state of Breakthrough, the team handles issues with power and velocity. The Leaders of the team must continue to express the vision and the team members need to stay organized and vigilant. Breakthroughs in results are often followed by a breakdown in process and delivery. If this occurs, swiftly establish the processes needed to sustain the Breakthrough.
The Operating State of Stability is what many organizations aspire towards. In this state, there are reliable, consistent, and steady results. While it may look effortless, it never is. In Stability, everything that is needed to succeed is present and available, the structure is fully understood by everyone, and accountability is clear cut and communicated with transparency. This is the operating state where concise targeted measurements and statistics are clear to every member of the collective. In the state of Stability, performance optimizes and the ratio of effort to result is 2:1 and that result creates several others. This is where and when great organizations continue to stretch by cross-training their people and advancing innovation.
Mastery is the Operating State where an organization possesses and displays a great deal of prowess, knowledge, and expertise in their field. In Mastery, the Division, Department, Product, Program, or Project gets handed over to a new leader. The team operates in the domain of outstanding and others want to replicate what you have created.
If the business or project moves from any Operating State to the prior Operating State (slides backward), you are operating in response to an Emergency or Danger. In an emergency, the first thing to do is declare a state of Emergency. The second thing to do is to find out what has changed. Did the team stop doing something that was working, start doing something they were not doing before or did the market change? If you can, get the problem corrected immediately and put a policy, process, or system in place to prevent the emergency from repeating itself. If it is an external market condition such as COVID-19, rally the troops and figure out what is the next best course of action.
Your business or project is operating in a state of Danger when it moves back two operating states. This is much more serious than an emergency. If it isn’t handled quickly, the business/project is at serious risk. In a condition of Danger, it is crucial to declare the danger, temporarily bypass the Leader/Manager, get the danger handled, and set it up so that it doesn’t happen again.
Knowing the current Operating State and being aware of what is required to achieve organizational effectiveness, gives leaders an understanding of specifically what is needed from them to move the organization forward.
About This Contributor
Silicon Valley's Top 100 Influential Women in Business!
Margaret empowers business leaders to reshape their company’s culture—sparking increased employee performance by up to 35% and revenue growth of up to 200%.