Title: Improving ANCINE’s Performance Management
System as a strategic management tool towards a more
flexible organizational culture
Supervisor: Prof. Dr. Corine Boon Student: Adriano Moraes Ferreira
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INDEX
1. Introduction ... 3
2. Literature Review ... 6
a. HR best practices and the Added-value of HR as a system ... 6
b. Performance management Systems ... 9
c. The additional challenges of managing performance in the public sector ... 14
d. Organizational Culture ... 16
e. Leadership and the Management of Change ... 21
3. Analysis: Organization, Performance Management System and Organizational Culture ... 29
a. Strategic Planning and the BSC ... 34
b. The Performance Management System As It Is ... 38
c. The Key Factors impacting the effectiveness of the Performance Management System .. 42
d. Organizational Culture – Current X Desired ... 30
4. Recommendations ... 48
a. Performance Management and the quality of implementation through managers ... 49
b. Horizontal Alignment ... 54
c. Vertical Alignment ... 58
d. Contextual fit ... 61
e. PM as an opportunity for cultural transformation ... 64
5. Conclusion ... 69
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1. Introduction
Governmental organizations face a complex dual pressure: On one hand, such organizations are expected to deliver effective public policies in a cost-efficient manner. On the other hand, they do not hold the same “strategic freedom” as private organizations (Moxham & Boaden, 2007).
Considering the nature of public policies, decisions as to change or end poorly performing operations are often not easy or possible to implement. In addition, strategic planning and execution are heavily affected by external stakeholders, as politicians, audit agencies, media, public opinion, users, etc. As a result of these additional layers of complexity, strategizing for the public sector is, contrary to the common sense, a very dynamic and ever-changing activity.
In such complex and turbulent environments, the pure ‘Weberian’ forms of organization, in which high specialization, rules, clear lines of decision-making (hierarchy), impersonality and accountability reflect the main cultural values and assumptions do not provide the flexibility, innovation and creativity needed to cope with this new context of fluid and fast-paced changes, increasing complexity and persistent pressure to perform better. A new set of values and assumptions or, in other words, a new organizational culture, is needed for that.
Culture refers to how groups learn over time and solve their problems of survival in the external environment, as well as internal integration (Schein, 1990). As such, culture plays a vital role inside organizations, helping to shape behavioral patterns and the way members of the organization are expected to respond in a given situation.
Leadership plays an important role on (re)shaping the organizational culture. By using power and influence as reinforcing mechanisms towards specific values and assumptions expected to increase performance, leaders impact the dynamic forces of socialization and group interaction taking place and, as a consequence, the behavioral patterns through which members of the organization solve their problems in a given environments.
One powerful mechanism leaders can use as a source of power and influence to (re)shape organizational culture is performance management. Organizations develop performance management activities for different purposes, as to control, to produce useful
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information for decision-making processes, to develop KSAs, etc. The ultimate goal of such activities, however, is to maximize employee and organizational performance.
By nature, an effective performance management demands constant interaction, communication and support, providing leadership a fertile ‘habitat’ for transformation efforts, in which leaders have the opportunity to use power and influence to induce new behavioral patterns that will, in turn, contribute to reshape the organizational culture. The effectiveness of a performance management system as a strategic tool, however, depends on the quality of the implementation through managers, and on the alignment with other important HR activities, organizational strategy and context/contingencies.
In this direction, and considering how HR practices can add value to organizational strategy and provide leadership opportunities to use power and influence to guide cultural transformation efforts, this project explores how can a Brazilian Federal Regulatory Agency (ANCINE) make the best use of its performance management system to transition from a control-oriented organizational culture towards a more flexible one?
Considering the expectation of practical applicability, which demands a discussion of a range of elements and aspects to be considered, this project will explore relevant academic literature and a combination of frameworks and tools from areas as performance management, HR best practices, HR as a system, additional complexity to strategize in the public sector, leadership and management of change.
By identifying key aspects of the current organizational culture and comparing them with the desired organizational culture, it will be possible to visualize the actual distance between the present reality and future expectations and, as such, to propose actions on how to make the best use of the performance management system (and of the links between this system and other HR practices) to transition towards the preferred organizational culture. The competing values framework (Cameron & Quinn, 2005) contrasts key elements of culture inside organizations and provides relevant insights on the gaps between current and desired cultures.
A description and analysis of ANCINE’s current situation regarding organizational structure, strategic planning and performance management right now is provided and the project also builds on previous research conducted in the same agency, in which the key characteristics of its performance management system, as well as the most powerful factors impacting its effectiveness were identified and discussed.
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This previous research found that characteristics such as a “pro forma” approach to performance appraisal, the link between appraisal and salary/promotions, conflict avoidance and job stability among the most impactful factors on performance. Such factors impacting the effectiveness of ANCINE’s performance management system also help to shape ANCINE’s current organizational culture. Actually, performance management systems are powerful tools to shape and/or change culture, as it contributes a lot to shape behavioral patterns and, thus, new values and assumptions.
Resistance to change is a natural phenomenon inside organizations. The transition towards a more flexible organizational culture is no exception. Consequently, this project identifies the inevitable barriers to change and proposes practical steps to mitigate the risks of failure and to successfully implement the new/desired organizational culture.
By focusing on the manageable aspects of change, the project highlights the role of strategic HR and leadership during the process, as actively responsible players for the development of powerful combinations between performance management and other best practices (horizontal alignment), keeping in mind strategy (vertical alignment) and the context in which ANCINE operates. By doing so, the project emphasizes practical recommendations on how leadership can use the performance management system as a source of power and influence and a strategic tool towards the desired organizational culture.
Keeping in mind that organizations often do not implement the best HR practices for many reasons, and including disconnected literature, managers’ perception of practical irrelevance, lack of time and prioritization to keep up with the new findings, etc. this project also attempts to summarize the key aspects discussed in graphic summaries, in which managers can have a snapshot of the key elements and, if needed, dive deeply whenever it is needed.
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2. Literature Review
a. HR best practices and the Added-value of HR as a system
Boxall & Purcell (2003) emphasize that strategic HRM refers to the ways in which talent management is critical to organizational effectiveness and achieving business objectives. What are the key HR policies, practices and investments? How are the actors in organizations making these decisions? How could the HRM system become more effective? These are some questions that strategic HRM tries to answer. The authors point out some of these best practices including employment security, selective hiring, self-managed teams (team working), high pay contingent on company performance, extensive training, reduction of status differences and information sharing (Pfeffer, 1998) act as general principles and processes as a basis for strategic HR.
At the same time, Pfeffer & Veiga (1999) build on previous studies and the set of best practices identified in the last paragraph to demonstrate that by implementing “High Performance management practices” companies are in fact increasing stock market value and shareholder wealth up to $ 41.000 per employee. Also, by putting employees first as a source of competitive advantage and implementing thorough reward policies, IPOs have higher chances of survival over the period of five years.
Boselie, Dietz & Boon (2005) identified diverse HR practices that, if well implemented as part of a coherent system, may also help organizations to achieve superior performance. Training & development, performance related pay, teamwork, collaboration, participation, communication & information sharing, recruitment, etc. are some of them.
These HR best practices can also increase employee well-being. Happiness-related and relationship-related well-being (e.g. trust, cooperation, supervisor/employee relations), including higher levels of discretion/autonomy, supportive work environment and better quality of work life increase motivation if levels of strain are kept to a moderate level (Peccei, 2004). In other words, HR practices provide resources to employees in order to cope with strain.
As one can see, numerous studies identify HR best practices that are clearly linked to superior organizational performance. As such, it is expected from organizations that they try to implement such practices, if they aspire to perform better.
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However, research shows that most companies do not employ state-of-the-art HR practices. There is a gap between literature and practice, which may be explained by too technical literature or the perception of irrelevance by practitioners (Rynes et al, 2002). Other reasons may include short-term pressures (e.g. annual results, stock prices, and immediate needs), tendency to destroy competences (tacit knowledge, experience, etc. are not easy to explain via formal planning and evaluation), lack of delegation, among others (Pfeffer & Veiga, 1999).
The first step, thus, is to create awareness on the best practices available. But more than creating awareness and keeping up with the literature on HR best practices, the key challenge is to develop an integrated system of practices with synergistic effect (Barney & Wright, 1997).
HR practices such as recruitment, training, performance management and reward should be integrated a part of a system and connected to the overall organizational strategy, helping to induce and reward individual employee behaviors toward organizational goals.
Powerful combinations take advantage of synergies between different activities (e.g above
market pay police + comprehensive performance management systems), while deadly
combinations refer to practices that make sense in isolation but reduce the overall
performance of the system (e.g. encouraging teamwork and rewarding individual performance) and should, of course, be avoided (Becker et al, 1997).
On the other hand, the way organizations implement a coherent HR system may vary significantly. Cultural norms and the unique history of different societies make it almost impossible to develop a universal set of best practices. In addition, sector and organizational variables (different industries, organizational culture, economical conditions, etc) also play a role. “In summary, there are certain broadly applicable principles and processes of good
labour management (best practices) but the methods firms adopt to reach their performance goals are inevitably affected by societal, sectoral and organizational factors (best fit).”
(Boxall & Purcell, 2003). The message is that HR practices must be tuned to fit the specific context, the specific contingencies, the specific organizational challenge and business environment.
Liu et al (2007) propose a very interesting model, from which it is possible to summarize key aspects of the design and implementation of a powerful HR system. The “AMO model” proposed by the authors argues that the HRM practices contribute most to
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organizational performance if they (A) increase employees’ knowledge, skills and abilities (KSAs), (M) motivate employees to leverage their KSAs for the firm’s benefit and (O) empower employees to do so (provide the right opportunities).
KSA-enhancing practices include strict recruitment policies (job fit and cultural fit), adequate compensation and training. Motivation-enhancing practices include incentive compensation (pay per performance) and internal promotion. Non-financial rewards also play an important role to enhance motivation (Luthans, 2000). Last but not least, empowerment-enhancing practices include participation (the degree to which employees are able to influence decision-making processes, flextime (e.g. compressed work weeks, telecommuting, etc.), grievance procedures and employment security (stable employment).
Once again, the alignment between HR practices is emphasized. To maximize the effectiveness of such practices, there should be (1) a vertical alignment between HR practices and organizational strategy, (2) a horizontal alignment among the HR practices (powerful combinations) and (3) contextual alignment (Liu et al, 2007).
It is interesting to note that, regarding to performance appraisal practices, the Liu et al (2007) study was inconclusive. The authors hypothesize that the reason may relate to how
appraisals are actually implemented in organizations. A failure to match the performance
appraisal/management system to the job itself (behavior-based approach vs result-based approach) and employees’ perception of political use of appraisals are some of the key aspects to take into account for this matter.
Regarding the implementation of HR practices overall, it is important to refer to Den Hartog et al (2013) a cross-level study on HRM, communication, satisfaction, and perceived performance. There is commonly a misalignment between the manager ratings of implemented HRM and employee ratings of perceived HRM. As many HR activities are actually implemented by the line managers, and not by the HR department itself, the ability of such managers to provide clear, useful and informative communication on organizational issues to the employees is crucial. On the other hand, line managers face many obstacles in accomplishing that, such as lack of training, conflicting priorities, work overload, self-serving behavior, etc.
Employee-rated HRM acts as mediator between manager-rated HRM, job satisfaction and perceived unit performance. As a result, the quality of implementation of HRM practices
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through line managers, and the role of communication during this process, is of considerable relevance.
The graph below – based on all the literature mentioned above – tries to compile and summarize some of the most cited best practices, and the different levels of alignment in one single model, providing a more visual perspective, through which organizations may have an initial snapshot on how powerful (or not) their HR systems are as a value-adding activity:
Fig. 1 – HR as a System
By developing a thorough understanding of the key HR practices that will help to achieve superior performance, of the importance of structuring such practices as a synergistic system, and of the challenges of implementation through managers, organizations can maximize the added-value of such practices as powerful tools to support strategy.
At the same direction, the impact of performance management as a tool to reshape organizational culture depends on the ability to design and implement such comprehensive and strategic-oriented HR systems, reason why it is relevant to address opportunities for a better implementation, to explore powerful combinations with other HR practices and to increase vertical/contextual alignment.
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b. Performance management Systems
Performance management activities are put in place for different purposes (e.g. control, information, development, etc.). But there is a relative consensus that the ultimate goal of such activities is to maximize employee performance and, as a consequence, to maximize organizational performance. Clardy (2013) summarizes some key aspects of performance managements as follows:
“Every organization has a performance management system of some kind, the default
condition being one that is informal, unplanned, and unmanaged. While a performance management system is sometimes equated to an organization’s performance appraisal process, a performance management system, as defined here, involves much more. Indeed, a performance management system is the total complex of factors that trigger, channel, and maintain productive task performance. The issue becomes whether a performance management system is well designed and operating to achieve the desired result of maximizing productive” (Clardy, 2013, p. 5).
From the conceptualization above, it is possible to see that performance management is more than an isolated activity. As part of the organization’s attempts to improve long-term results, performance management systems involve a set of interlinked activities that must contribute to form powerful combinations (horizontal alignment) through which HR adds strategic value (vertical alignment) for organizations operating in a specific business environment (contextual fit).
Performance management happens as a specific and ongoing cycle, in which setting objectives, observing performance, and providing/receiving feedback exist as a never-ending process. Aguinis (2013) argues that this never-ending cycle includes the following components (although they are intrinsically interrelated): prerequisites, planning, execution, assessment, review, and renewal/recontracting.
The prerequisites are a thorough knowledge of the organizational strategy (mission, vision, long-term goals, etc.) and a thorough knowledge of the job to be done by individuals to implement the strategy (activities, tasks, processes, products, services, KSAs, etc.). Planning refers to activities such as managers and employees meeting to discuss and agree
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upon the goals for a specific period of time and what kinds of behaviors and development plans are needed to achieve the expected results.
Execution includes collecting and sharing performance data, feedback, coaching, ongoing communication, among other things. The assessment and review components refer to the moments in which employees and managers evaluate if behaviors, development plans and results were achieved and how to keep improving for the future. Lastly, the renewal component is almost identical to the planning stage, with the main difference being the use of information and expertise gained during the other stages as an asset.
Embedded in all components listed above, there are some managerial activities that are crucial for an effective implementation. Ongoing feedback is traditionally viewed as an important monitoring and control activity, through which individual behavior and attitude are shaped. But more than that, there are several studies supporting the hypothesis that adequate feedback is a powerful tool to motivate and satisfy (e.g. Jaworski & Kohli, 1991; Rahman, 2006; Guo et al, 2014).
In addition to ongoing feedback, the effective communication to different audiences (including the development of communication plans) and intense participation and support from the top management are some of the most important activities to be carried out for an effective implementation of performance management systems (Aguinis, 2013). In this project, such activities are explored in more depth in relation to the literature of leadership and management of change.
As one can see, effective performance management demands constant and dynamic interaction between leaders and followers. Ongoing feedback, top management support and effective communication are, by nature, ‘social’ activities that provide leadership opportunities of using power and influence as tools to shape and direct individual behavior and attitude.
By directing such ‘social’ activities taking place during a performance management cycle towards a shift in organizational culture, leaders can at the same time motivate individuals and reinforce behaviors that will help to nurture a new and desired organizational culture. As such, a well designed and implemented performance management system can play a significant role on cultural transformation efforts.
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But to maximize the contribution of a PM system as a management of change tool, it is once again relevant to emphasize the need for a contextual fit. Illustrative of that, Hoogenboezen & Hoogenboezen (2005) assessed critical implementation aspects of a new performance management system and the rationale behind the decision-making processes in a peculiar organizational context: a Dutch police institution. By emphasizing the contextual aspects, the authors demonstrate how a rising prioritization of public performance management in the end of 1990s (similar to the NPM movement) led to dramatic changes on how performance management was conducted in that organization.
Although the Dutch political system often relies on general consensus rather on responsibility and enforcement, the new performance management system was not aligned with this important contextual element. On one hand, the Dutch police approach to fighting criminality used to be based on community policing, “in which the police do not limit
themselves to law enforcement but also address social conditions and situations, and in which policemen are professionals who make their own decisions on how to handle certain cases, within considerable margins of freedom" (Hoogenboezen & Hoogenboezen, 2005, p. 569).
On the other hand, the new system established and cascade down targets and KPIs as “to get
700 drug addicts off the street” in Rotterdam, at the same time increasing accountability and
responsibility of each policemen.
In general, police chiefs were supportive to the new performance management system, especially considering the political debate about the issue at that time, but negative consequences started to occur at the individual level. As a result of the large increase in targets from management to the individual level, some policemen started to act in unwanted ways, such as writing fines in situations in they traditionally would not have as a way to achieve individual targets. In addition, there was a lower perceived level of motivation, engagement and overall job satisfaction with the police profession, considering that one of the key reasons pointed to by police as an attractive aspect of their careers was the autonomy and the ability to make choices in response to an individual situation.
In sum, the authors demonstrated that the performance contracts implemented by the Netherlands’ police underestimated contextual characteristics, instead being introduced,
"because politicians want them to do so" (Hoogenboezen & Hoogenboezen, 2005, p. 576),
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dangers of underestimating contextual fit while implementing a structured performance management system.
As will be discussed in more details during the next section, managing performance in the public sector involves additional layers of complexity that, in turn, demands higher levels of customization/fit on how HR best practices are to be used.
The figure below synthesizes the performance management cycle, as discussed in this section:
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c. The additional challenges of managing performance in the public sector
Measuring organizational and individual performance is a well established and traditional management practice in the private sector (Moxham & Boaden, 2007). However, there are relevant differences between performance management for the private sector and for public organizations, with an ongoing debate focused on the differences or similarities between public and private organizations. According to Moxham & Boaden (2007), limited strategic options and the role of different stakeholders are two of the main differences impacting the “import” of private sector best practices to public organizations.
The authors argue that the complex interaction of multiple and distinct stakeholders in the public sector (e.g. elected representatives, users, consumers, NGOs, media, audit agencies, managers, employees, clients, users, etc), "often result in performance measurement being
used merely as a diagnostic tool and not an interactive one within public sector organisations" (Moxham & Boaden, 2007, p. 831). As a direct result of this, parallel systems
are quite often utilized as a way to track organizational objectives, with performance management sometimes being “closer to fiction” in many public organizations (Radnor & McGuire, 2004).
In addition, Moxham & Boaden (2007) also suport that, contrary to the private sector, public organizations do not hold the same "strategic freedom". Illustrative of these limitations, ceasing poorly performing public business/operations is not as easy, or even possible, as in the private sector. Moreover, strategy is not exclusively designed and implemented by the public organizations themselves, but often with heavy influence of politicians, audit agencies, and other players.
Similar challenges were found by the Chartered Institute of Management Accountants (2010) for the British public sector. The report cites the multiplicity of stakeholders, the complexity of social demands/needs for public services, the constant leadership changes and the degree of (inter)dependence across different units and organizations as some of the main obstacles for the implementation of performance management practices in that specific context.
One of the common “recipes” to improve operational efficiency in the private sector includes austerity measures, reduction of costs, high attention to financial KPIs, among
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others. However, the Arnaboldi, Lapsley & Stecollini (2015) study assessing the efficiency of New Public Management’s (NPM) diagnostic on how to improve performance management systems in public organizations (i.e., more austerity and search for efficiency), found that the over-simplified approach to a highly complicated issue may result in the prevalence of negative side effects, rather than overall better results.
Other critics of the NPM suggest that the negative side effects heavily outweigh the benefits. Low morale, fear, resentment, lack of motivation (Diefenbach, 2009) or even the prevalence of an “audit society”, in which compliance to rules, procedures and audit controls directs organizational energy away from its primary purpose and increases the overall workload (Power, 1997) are some of the examples.
In sum, it is important to note that the implementation of a result-oriented organizational culture in the public sector, in which performance management systems are used with strategic intent and actually add strategic value, face additional obstacles. In a context in which diffuse strategy definition and multiple stakeholders actuation, importing best practices and principles typical of the private sector turns out to be a very delicate question:
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The use of PM systems as facilitators of change in the public sector, thus, will demand accurate consideration of such contextual differences and special attention to the quality of implementation of this HR best practice as part of a synergistic system.
d. Organizational Culture
Culture refers to how groups learn over time and solve problems of survival in the external environment and of internal integration (Schein, 1990). It happens in different levels, from the most “physical” and observable , such as the dress code, how people address each other and layout (artifacts), to the values and assumptions underlying (sometimes even at the unconscious level) and justifying these observable patterns (Schein, 1990). To increase the effectiveness of HR to organizational performance, it is crucial to understand the current and desired organizational culture, the steps needed to evolve and how to overcome the inevitable barriers to change.
Culture is learned. The way people respond to critical incidents, in which there is a lot of tension and anxiety, sometimes is a strong force shaping norms, beliefs and behaviors. Schein (1990) exemplify that with the hypothesis of a member attacking a leader: the consequences (behavior) after an episode like this may be powerful enough to shape social norms. If the leader counterattacks and the member “concurs” (being silent, for example) or apologizes, such episode may create the norm of “authority is sacred”, “we must not attack the leader” (Schein, 1990).
Leaders play a key role in shaping organizational culture. “Founder’s” values, and
assumptions, when organizations first form, provide a guideline for how a group should function and should be structured. Over time, however, the dynamic forces of socialization and group interaction result in a more complex and emerging set of cultural assumptions. In cultural dynamics, organizations (and leaders) try to actively reinforce those aspects of culture expected to maintain identity and contribute for long-term goals and, at the same time, “erase” cultural elements viewed as increasingly dysfunctional. Such attempts are called the “management of change”, which we will discuss later in this project.
If powerful enough, leaders will remain highly influential in shaping organizational culture, making use of primary embedding mechanisms and secondary articulation and
reinforcement mechanisms, which will also be further explored during the development of
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In fact, there are many ways culture emerges in organizations. For the purpose of this project, the focus must reside on the “controllable” aspects, on the conscious development of a corporate culture able to “reduce collective uncertainties, (that is, facilitate a common
interpretation system for members), create social order (make clear to members what is expected), create continuity (perpetuate key values and norms across generations of members), create a collective identity and commitment (bind members together), and elucidate a vision of the future (energize forward movement)” (Cameron & Quinn, 2005, p.
5).
Cameron & Quinn (2005) developed one of the most comprehensive frameworks on how to diagnose and change organizational culture, in order to enhance organizational effectiveness and performance. The authors contend that, in order to achieve superior performance in the long-term, managing organizational culture can be more effective than most other traditional organizational changes attempts, such as TQM initiatives, downsizing or reengineering.
By demonstrating how several studies found inefficiencies in such approaches, the authors argue that the main reason lies in the fact that “although the tools and techniques may
be present and the change strategy implemented with vigor, many efforts to improve organizational performance fail because the fundamental culture of the organization – values, ways of thinking, managerial styles, paradigms, approaches to problem solving – remains the same.” (Cameron & Quinn, 2005, p. 11).
In other words, without a substantial change in organizational culture, the way groups learn over time and solve its problems of survival in the external environment and of internal integration (the assumptions, values and artifacts on how to behave) remain unchanged. Consequently, although quite often underestimated, the active management or organizational culture may be a catalyst for sustainable superior performance.
The first step to manage organizational culture is to understand what the actual culture looks like. Every organization has a specific organizational culture, although there are many variations on types and rigidity, caused by higher/lesser leadership power, higher/lesser environmental pressures, higher/lesser organizational existence, etc.
The competing values framework (Cameron & Quinn, 2005) categorizes different cultures under four different types, derived from a range of organizational effectiveness indicators. One dimension differentiates the criteria of stability, control, order versus the
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criteria of discretion, dynamism, flexibility. Some organizations are viewed as effective if they have the ability to adapt, to ever change, while for other organizations, the success may lie on stability, predictability. There is of course a range of possibilities in the continuum from the most stable to the most “fluid” organizations.
The second dimension differentiates between an internal approach to business (integration, unity) and an external orientation (rivalry, differentiation). For some organizations, effectiveness relates to a certain way of doing business (“IBM way”), which emphasizes a internal orientation while, for others, the differentiation, rivalry, ability to adapt to local characteristics outside their own boundaries may be a source of competitive advantage.
As a result of these two dimensions, four quadrants are formed, each of them denoting specific organizational characteristics, with opposite (or competing) assumptions. The X and Y axis contain core values that are competing from one side of the continuum to the other.
Fig. 4“The Competing Values Framework. Extracted from Cameron & Quinn, 2005, p. 35.
At the lower left level, the hierarchy culture reflects the key characteristics of a Weberian bureaucracy: high specialization, meritocracy, rules, clear lines of decision-making (hierarchy), impersonality, accountability. Such an approach was very common in organizations searching for stability, standardization, predictability, reliability, etc. Actually,
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the Weberian bureaucracy was considered the ideal type of administrative organization (until the 1960s), as it leads to consistency and efficiency, if one assumes a stable business
environment. In such organizations, leaders are considered effective if they are able to
coordinate and organize operations, as smoothly as possible.
At the lower right side of the framework, the market culture emphasizes a “transactional”, market-oriented organization. This type of culture is focused on the external environment, rather than on internal issues. As such, the mechanisms of control are not ruled by hierarchy, specialization and centralized decision-making. In fact, transactions (monetary transactions, sales, contracts, exchanges, etc.) are the main drivers of competitive advantage. As a result, productivity, financial results, competitiveness are some of the key values in such types of culture. The measure of leadership effectiveness inside market cultures is correlated to the level of competitiveness, winning the game, outpacing competitors and improving market share.
The third cultural type is the clan culture, at the upper left part of the graph. Such organizations are considered “family-type”, in which cohesion, participation, shared values, a sense of “we-ness” shape decision-making processes. Employee involvement, commitment, teamwork, team rewards, empowerment are some of the key elements through which such organizations expect to perform better at the long-term. Leadership effectiveness, for clan cultures, is direct correlated with the ability to mentor, to coach, to empower and to facilitate employee participation, loyalty and commitment.
The last organizational type is the adhocracy culture. In the era of information, turbulence and fast-paced environmental changes, the adhocracy culture is considered the ideal type for the companies operating in the business environment of the 21st century. Innovation, developing new solutions, being creative and adaptive, and being prepared for the challenges of the future are some of the assumptions in such organizations. Project teams, reconfiguration of resource-allocation, flexibility, uncertainty, information overload, etc. are some of the characteristics one will mostly find in adhocracy cultures. Contrary to market or hierarchy cultures, power “flows” from team to team, from individual to individual, as needed. There is higher risk-taking, individuality, fluid organizational designs, and leadership effectiveness includes vision, risk-orientation, and innovation with success measured by the development of new products, services and solutions.
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The Organizational Culture Assessment Instrument (OCAI), developed by the same authors, is a very informative tool in which organizations may compare and contrast the actual and preferred culture in place. It is worth to mention that, for each of these cultural types, different approaches to HR, strategy, quality management, etc. make more or less sense. Considering the scope of this project, the specificities related to HR, leadership and strategy will be discussed as part of the recommendations.
In sum, organizations should create awareness on what set of artifacts, values and assumptions or, in other words, what type of organizational culture they currently possess and what type of organizational culture would be most adequate to achieve their long-term organizational goals. Considering the probability of some level of mismatch between the current and intended organizational culture, it is crucial for organizations to develop “management of change” capabilities, as a way to influence and “shape” culture in the desired direction:
21 Fig. 5 – Organizational Culture
e. Leadership and the Management of Change
Leadership has always been considered a very interesting and relevant topic in academic fields such as organizational psychology, business administration, sociology, political relations, etc., which is why abundant literature is available. Considering the scope and limitations of this project, however, the focus will reside on what are the “best practices” of leadership (those universally accepted characteristics of a good leader) and on how leadership plays a role in shaping culture and transforming organizations, in the search for achieving strategic goals.
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In this sense, the Den Hartog & Koopman (2001) study provides relevant advice on the different approaches and types of leadership, emphasizing the transformational/charismatic leadership. The authors first introduce the main aspects of leadership as described by the literature prior to the 1980s: trait, style and contingency approaches.
The trait approach theorists emphasize that “leaders are born” and, as such, organizations should try to the search for “the great man”, to identify those traits (physical features, ability and personality) that differentiate effective and ineffective leaders. The style
approach to leadership, on the other hand, emphasizes how leaders behave, arguing that as a
behavioral pattern, leadership can be learned. The key issue, thus, is to find the “right” leadership style and then act to develop it. Criticisms of this approach include the ignorance of situation, context, and informal leadership, among others.
The contingency approaches, including situational leadership theory and the normative decision-making model, among others, came out as an alternative to deal with the deficiency of the past models. It argues that the effectiveness of leadership styles is “contingent on the situation”, that the context is the key driver for leadership effectiveness. Criticisms, in this case, involve the need for more robust empirical evidence, conceptual weaknesses, and the use of group averages on leadership description, among others.
In contrast to all these approaches, the “new” leadership approaches include terms such as transformational, charismatic, value-based, visionary leadership that seem to contain more similarities than differences. Charismatic leadership “is seen as giving meaningfulness
to work by infusing work and organizations with moral purpose and commitment” (Den
Hartog & Koopman, 2001). Visionary/charismatic leaders are able to enhance the value of goal achievement and efforts by connecting them to aspects (principles, values) that are valued by the followers. Such leaders can be viewed as transformational¸ as their ability to provide a vision, a sense of mission, to inspire others, to demonstrate individualized consideration with followers needs (coaching, mentoring) and to intellectually stimulate with new ideas and perspectives help to mobilize efforts towards changing, transforming the organization.
There are several attributes of transformational leadership that are considered desirable across different cultures, worldwide. For the purpose of this project, we will denote them as ‘best-practices’ of transformational leadership. These attributes include integrity (being
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perceived as just, honest, trustworthy), charisma/vision (encouraging, positive, builder, dynamic), team-orientation (superior ability to communicate, coordinate and form teams), intelligence, problem solving, etc.
Transformational leadership generates higher attachment of followers to leaders’ ideas, less group conflicts and enhanced sense of empowerment. Meta-analysis also indicates transformational leadership as a predictor of work unit effectiveness, including organizational indicators of performance and subordinate perceptions.
For the purposes of this project, is definitely worth mentioning that the same meta-study found that transformational leadership effect on performance is, contrary to the expectations, “larger in public rather than private organizations and for lower- rather than higher-level leaders” (Den Hartog & Koopman, 2001, 177). As a possible downside of charismatic leadership, however, organizations should be aware and try to mitigate eventual negative side effects such as dependence on charismatic individuals, unquestioning obedience impacting group decision-making, failure to create succession plans, among others.
As mentioned many times during this project, communication is a key factor during the implementation of performance management systems. The same holds true for the ability to inspire others. In this sense, Conger (1991) argues that the ability to inspire the audience has been mostly lost in the business environment, due to an over focus on logical and rational language (e.g.. budgeting, operating goals and policies, etc). In response to this “threat”, the author provides a powerful framework to help business leaders not only to transmit their company strategy, but also to inspire the audience, the followers, with their message. The skills needed for that include creating an organizational mission (Framing) and communicating that mission (Rhetorical Crafting).
Framing refers to defining the purpose or mission of the company in a meaningful
way, wording it in a way that provides direction and acts as a compass. Different working may impact the audience in different ways. Rhetorical crafting, according to the authors, is the other necessary skill to master the “language of leadership”. It includes the use of metaphors, analogies and organizational stories and gearing language to different audiences, along with other speech techniques. In sum, the framework emphasizes many aspects of communication that can be improved – by training and practical experience – in order to become more inspirational and engage today’s audience.
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The leadership literature findings suggest that public organizations should create higher level of awareness on the importance of transformational/inspirational/charismatic leadership as a key aspect of managing changes and achieving sustainable superior performance.
As highlighted before, leaders play a key role in shaping organizational culture. They influence how a group should function and be structured, by embedding the organization with their values and assumptions. Over time, however, the dynamic forces of socialization and group interaction result in a more complex and emerging set of cultural assumptions. In cultural dynamics, organizations (and leaders) try to actively reinforce those aspects of culture expected to maintain identity and contribute for long-term goals and, at the same time, “erase” cultural elements viewed as increasingly dysfunctional. Such attempts are called the “management of change”.
If powerful enough, leaders will remain highly influential in shaping organizational culture, making use of primary embedding mechanisms and secondary articulation and
reinforcement mechanisms (Schein, 1990). Primary embedding mechanisms include what
leaders are paying attention to; how they react to critical incidents and crises; how they allocate rewards and status; role modeling and coaching; and criteria to recruit, select, promote, retire, etc. In other words, primary embedding mechanisms includes some of the most visible ways through which leaders influence organizational culture.
Secondary articulation and reinforcement mechanisms, on the other hand, refers to
‘less visible’ mechanisms, the way things are set up, that are also important aspects of culture formation. Such mechanisms include “(a) the organization's design and structure; (b)
organizational systems and procedures; (c) the design of physical space, facades, and buildings; (d) stories, legends, myths, and symbols; and (e) formal statements of organizational philosophy, creeds, and charters.” (Schein, 1990, p. 115). Although not so
visible, such aspects are extremely important to shape organizational culture, to induce managed changes.
In a different perspective, there are different ways leaders exert (and/or deserve) power and influence enough to transform organizations. Traditionally many view the sources of power and influence as mainly based on privileged access to and control over information combined with the hierarchical use of authority (“chain of command”). But other sources of influence, such as being recognized as an expert and a legitimate reference, also play a key
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role if the goal is to be able to influence others beyond a formal role (Den Hartog & Kopman, 2001).
The key message is that leaders must be aware that, by nature, they (potentially) possess diverse visible and ‘invisible’ sources of power and influence that should be considered during the attempts of shaping organizational culture. Such tools are crucial as mechanisms to overcome the unavoidable barriers to change.
As Kotter (1995) explains, most of the transformation efforts in companies actually fail. Change processes face resistance, consist of a series of phases and, consequently, demand a considerable length of time and efforts. Based on his experience, Kotter highlights the eight big errors causing transformation efforts to fail. These are (1) not establishing a sense of urgency; (2) not creating a powerful enough guiding coalition; (3) lacking a vision; (4) undercommunicating the vision by a factor of ten; (5) not removing obstacles to the new vision; (6) not systematically planning for and creating short-term wins; (7) declaring victory too soon; and (8) not anchoring changes in the corporation’s culture. While sharing his insights on each of these eight errors, the author provides relevant recommendations on the best ways to avoid each of them and Child (2005) consolidates these recommendations in a very illustrative way.
As one can see, leadership can (and should) use tools and mechanisms available to guide transformation towards the desired direction, and should never underestimate the role of time, perseverance and efforts to succeed. Considering a performance management system as the locus in which such transformation efforts will take place, leadership maximize their role of agents of change, as leaders also play an important role in PM systems:
26 Fig. 6 – Transformation. Framework. Extracted from Child (2005). Adapted from Kotter (1995)
Kotter’s transformation framework relies on the same principles described for the first time by Lewin (1947). His three-phase model (unfreeze, change, refreeze) states that
unfrezzing is the process by which people in organizations visualize and accept the fact that
change is needed, and that the status-quo is no longer sufficient, what Kotter tries to achieve by establishing a sense of urgency. The change phase refers to all movements from an old situation to a new one (steps 2 to 6), while the refreezing phase relates to the institutionalization of changes, the movements that will ensure that culture support the new/changed situation (steps 6 to 8). Despite a somewhat static view of how organizations evolve, which is understandable considering the context of the author at the time, this
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framework brings attention to important elements of change, as the fact that unfreezing (i.e. breaking the status quo, creating uncertainty, ‘energizing’) is a prerequisite to facilitate and reduce resistance during the long process to come.
Although there are endless possibilities on how to link the literature discussed and highlight how leadership may play a huge role during the management of changes, the figure below highlights some of the most visible connections:
Fig. 7 – Leadership & Management of Change
The steps 1 (establishing a sense of urgency), 3 (developing a vision and strategy) and 4 (communicating the change vision) will demand the framing and rhetorical skills highlighted by Conger (1991) as vital for inspirational communication. The development of such skills may be achieved by training and practical experience. The steps 2 and 5 through 8 demands using the primary embedding mechanisms and secondary articulation and reinforcement mechanisms cited by Schein (1990), in combination with the sources of power and influence discussed by Den Hartog & Kopman (2001), as authority to get rid of obstacles or restructure operations, and being recognized as an expert and a legitimate reference.
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In this sense, performance management systems may provide leadership a fertile ‘habitat’ for transformation efforts, in which leaders have the opportunity to use power and influence to insert new patterns of interaction, inspirational communication and support, and to induce new behavioral patterns.
First, performance management demands constant interaction between leaders and followers, including ‘social activities’ as ongoing feedback, top management support and effective communication. As such, PM systems provide important interaction opportunities through which leaders can establish a sense of urgency, ‘unfreezing’ the organization and creating a more adequate environment in which transformation efforts may thrive.
Secondly, the interaction activities typical of a well executed PM system also provide opportunities to frame and communicate the change vision and strategy throughout the whole organization, a powerful communication tool that mitigates the risk of under communicating the change vision by a factor of ten and enhances the chances of successful transformation.
In addition to that, performance management provides relevant information on the main obstacles to achieve organizational objectives and, as such, on possible barriers for the implementation of a new organizational culture. By empowering broad-based action and removing the barriers for change that are identified during a performance management cycle, leadership once again maximize their role of agents of change in a very concrete way.
Also, performance management provide leadership opportunities to generate short-term wins, to recognize and reward those behaviors that are most expected to contribute for the desired change, consolidating the gains, creating a positive scenario to produce more change and, finally, ‘freezing’ and sustaining the new culture for the long-term.
In conclusion, the efforts to shift ‘one’ organizational culture towards ‘other’ considered more effective (although culture may be seen as a dynamic process) requires time, management, effective leadership and discipline. A performance management system provides leaders the communication and interaction opportunities they need to use power and influence as a change management tool during this hard-to-implement task. In other words, PM systems are a fertile ‘habitat’ for the use of power and influence.
The ‘trophy’ for a well succeeded transformation effort is the one that all are searching for: long-term superior organizational performance.
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3. Analysis: Methodology, Organization, Performance Management System and Organizational Culture
In this chapter, an overview of the organization, its performance management system and organizational culture is provided. First, the project makes use of Cameron & Quinn’s (2005) competing value framework as a tool to describe and interpret the current and desired aspects of ANCINE’s organizational culture. The framework helps to build a better picture of how ANCINE’s managers (in this case, represented by the HR manager and by the Secretary of Internal Management) perceive the current organizational culture and what would be the ‘ideal’ type to improve organizational performance and achieve strategic goals.
After that, the organizational structure, sources, methodologies and tools used for strategic planning are described, with emphasis to the use of the Balanced Scorecard (BSC) and its strategic map as a consolidator of all different elements. The most relevant components of the current performance management system are highlighted, including the normative constraints, the different stages of the yearly performance management cycle, the existence (or not) of ongoing feedback, support from top management and effective communication and the existence (or not) of the prerequisites for a thorough performance management system (knowledge of strategy and knowledge of the jobs to be done).
This part of the analysis, qualitative in nature, was mostly based on archival research (Easterby-Smith et al, 2012) over information already produced by the organization. The first sources of data used were the three last annual reports available at ANCINE’s website (2011 to 2013), in which the organization consolidates the main activities developed during the year, including its strategic priorities, and the perspectives for the next years.
The analysis of such documents resulted in the inclusion of additional sources of strategic prioritization, being the most important the Brazilian Multi-Year Plan, the BSC strategic map 2013, the Directive and Targets Plan 2012 and the PNC 2020. These documents are available in the public domain and the web links can be found on the reference list of this project.
In addition to that, the analysis also included the laws, decrees and guidelines related to ANCINE’s performance management system. As we explain further during the project, ANCINE must comply with the frameworks established by the Federal Government and, as
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such, has limited flexibility to adapt such frameworks in order to tackle specific needs. Being a previous member of the organization, the project also includes my personal experience to describe the peculiarities and details of the performance management system as it is right now.
Also, the Human Resources department allowed us to access the Climate Survey final report 2013/2014 (the only one available), in which employees’ perception over different subjects as leadership, engagement with strategy, rewards, quality of life at work, communication, etc. were collected. This document brought relevant information on opportunities for development and on strengths to explore to maximize the positive effects of transformation efforts.
Then, the results of previous research – in which the main cultural and contextual factors impacting the effectiveness of ANCINE’s performance management system – are highlighted, and diverse quotes from unit managers, representative of how they perceive the performance management system and possibly of obstacles/limitations for a managed change of culture are provided. In other words, the data originally collected for a previous research was re-analyzed from a different perspective, i.e. from the perspective of how leadership can use the PM system to induce a more flexible organizational culture.
By doing so, the project provides a “big picture” of the main elements, challenges, peculiarities and opportunities for development of ANCINE’s performance management system as a tool to shape organizational culture.
a. Organizational Culture – Current X Desired
ANCINE is a Brazilian Federal Regulatory Agency, whose main responsibilities are fomenting, regulating and monitoring the Brazilian Audiovisual market. ANCINE’s mission is to develop a competitive, strong, and sustainable Brazilian cinema and audiovisual market (http://www.ancine.gov.br/ancine/apresentacao, 2014). Currently, this public organization has more than 400 employees (approximately 420 public servants), half of them being recruited from 2011 to 2015. The annual budget for administrative operations in 2015 was
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approximately US$ 13 million (excluding salaries and benefits, paid with resources from a different budget).
As mentioned before, the management of organizational culture can be even more effective than other traditional organizational change efforts such as TQM initiatives, downsizing or reengineering. Actually, the success of change efforts in different areas is directly correlated to how much the change becomes embedded into the organizational culture. As such, a better understanding of how the organizational culture looks right now, in contrast to the ‘ideal’ type of culture expected to produce the best results for the organization, can be of tremendous help.
To develop such understanding, the competing values framework (Cameron & Quinn, 2005) is one of the most famous and comprehensive tools available, providing a snapshot of the organization in regards to opposite values such as internal x external focus and flexibility x stability. We asked 2 members of ANCINE’s management team, directly involved in this project (HR Manager and Secretary of Internal management), to answer the OCAI questionnaire and the results are compiled below. One of the members was responsible for answering the questionnaire and the second member validated the answers:
32 Fig. 8: Current X Preferred Organizational Culture
An analysis of the results show that the current organizational focus prioritize an internal focus / integration (left side of the quadrant) rather than an external focus / differentiation (right side of the quadrant). As such, the management perception is that, currently, the organizational culture privileges a “certain way of doing business” as the way to go.
The prominent types found were the Clan culture and the Hierarchy culture. The Clan culture is considered a “family-type” culture, in which cohesion, participation, shared values and a sense of “we-ness” shape decision-making processes. Employee involvement, commitment, teamwork, team rewards, empowerment are some of the key elements through which such organizations expect to perform better in the long-term. Inside Clans, HR usually plays the role of “employee champion”, ensuring employee well-being, responding to their needs, in a search for commitment, cohesion and capability. Leadership effectiveness is
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directly correlated with the ability to mentor, coach, empower and facilitate employees’ participation, loyalty and commitment.
For the Hierarchy culture, however, elements such as high specialization, meritocracy, rules, clear lines of decision-making (hierarchy), impersonality, and accountability prevails. These are the key characteristics of a Weberian bureaucracy, considered the ideal type of administrative organization (until the 1960s), in which stable business environments allowed organizations to focus on consistency and efficiency. HR focuses on processes and efficiency, assuming the role of administrative specialist. Under Hierarchy cultures, leaders are considered effective if they are able to coordinate and organize operations, as smoothly as possible. Error detections, measurements, process control, etc. are some of the tools used for that.
On the other hand, the results show that the preferred organizational culture differs significantly from the current one. Rather than emphasizing stability and control (bottom of the graph), the respondents believe that discretion, dynamism, flexibility, adaptability (upper of the graph) would be more effective in the search for effectiveness.
The Clan type of culture is actually considered ‘ideal’, with little discrepancy between the current and desired organizational culture (in fact, the results suggest the reinforcement of this type of culture). There is also little discrepancy between the current and desired levels or “market” orientation. The major divergence, however, lies on the prominence of Adhocracy as a desired type, in opposition to the Hierarchy culture. As stated before, the adhocracy culture incorporates characteristics of fast-paced business environments, in which information is a key source of competitive advantage and turbulence prevails.
Innovation, development of new solutions, creativity, adaptability, and preparation for the challenges of the future are some of the assumptions in such type or organization. Project teams, reconfiguration of resource-allocation, flexibility, uncertainty, information overload, etc. are some of the characteristics one will mostly find in adhocracy cultures. Contrary to market or hierarchy cultures, power “flows” from team to team, from individual to individual, as needed. HR is expected to act as a change agent, facilitating transformation and organizational renewal. To do so, system analysis, organizational change skills, consultation and facilitation are some of the competencies required. At the same time, leadership effectiveness involves characteristics of inspirational/visionary/charismatic leaders, such as
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vision, risk-orientation, and innovation, being success measured by the development of new products, services and solutions.
In summary, ANCINE management expectations regarding to organizational culture involves a shift towards flexibility and discretion, with higher levels of innovation, risk-taking, creative solutions, visionary leadership, etc. in detriment of traditional Weberian characteristics as control, specialization, clear decision-making and search for ever-increasing efficiency. Such findings are consistent with the fact that, contrary to common sense, the additional layers of complexity, multiple stakeholders and limited strategic options for managers in the public sector, turn strategizing in such environments a very dynamic and turbulent task.
In this sense, this project targets practical possibilities on how ANCINE’s performance management system can be used as a strategic tool to transition towards a more flexible and innovative organizational culture (Adhocracy), without losing the positive aspects of Clan cultures.
To do so, it is first crucial to develop a better understand of ANCINE’s current characteristics, including its structure, strategic planning, performance management system and key factors impacting this system. After that, it will be possible to provide more specific recommendations on how leadership can use the PM system as a starting point of a cultural transformation effort.
b. Strategic Planning and the BSC
ANCINE’s mission, in a free translation from Portuguese to English, is “to develop
and to regulate the audiovisual market in benefit of the Brazilian society”. ANCINE’s
extrinsic values (highlighted in its strategic map) emphasize freedom of speech, valorization of the national culture, plurality, diversity, sustainability, among others. The strategic objectives and long-term goals are summarized under 2 main directives:
Market Development/Fomentation: relates to financing activities for Brazilian
audiovisual content, improvement of business ecosystems (networks formed by producers, distributors, etc.), training of market players, and stimulus for the growth of paid TV, among others. The budget for such “finalistic” activities in 2015 was approximately US$ 200 million.
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Regulation: Relates to the design, implementation and control of market rules aiming
to support the production, availability and broadcasting of relevant of Brazilian content (e.g. X hours of Brazilian Audiovisual content on open and paid channels), taxation, etc.
Like most of the public organizations in Brazil, ANCINE’s organizational structure is mostly traditional and hierarchical. Traditional structures emphasize alignment rather than
adaptability, sometimes limiting ambidexterity capabilities (Birkinshaw & Gibson, 2004).
Characteristics of such structures typically include high reliance on written rules, centralized decision-making processes and many different layers of authority (Child, 2005). As such, ANCINE did not develop profound adaptability capabilities over time (although there are many recent initiatives in which such capabilities are emphasized, including incentives for social participation on strategic management).
Fig. 9 - Organizational chart
Available from: http://www.ancine.gov.br/sites/all/organograma/index.html (Accessed 07 July 2016)
Regarding specifically the organizational strategy, our previous research in the same institution found that multiple stakeholders and multiple sources of strategic prioritization are among the most influential factors impacting the effectiveness of ANCINE’s performance
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management system, which is coherent with Moxham & Boaden’s (2007) propositions. Different players as the Brazilian Central Government, the Ministry of Culture, the Audiovisual Sector Fund Committee and Audit Agencies directly influence ANCINE’s strategic planning and, as such, include additional layers of complexity not only to define priorities but also on how to communicate and execute them.
But it is also true that ANCINE has tried to overcome such obstacles by implementing more effective and structured methodologies and tools. In 2013, ANCINE introduced its first strategic map, as part of the Balanced Scorecard (BSC) methodology, implemented during that year. The strategic map was elaborated as a way to “organize and communicate the main institutional objectives”. The BSC provides, at one time, a proper framework to manage and measure performance, helping to create the links between institutional goals/objectives and key performance indicators and targets (Atrill & McLaney, 2012).
One advantage of the BSC framework is that it includes at the same time financial and non-financial measures acting as value drivers inside organizations. As such, public organizations may find this framework very helpful as, by nature, most long-term objectives are not financial in nature. While the ultimate long-term objective for private sector organizations used to be to increase shareholders and/or stakeholders value (a financial measure, in the end), for public organizations such ultimate objectives usually target the general well-being of the society, a non-financial measure.
Actually, public organizations have traditionally used strategic management tools from the private sector (Moxham & Boaden, 2007) and ANCINE followed this trend by implementing the BSC as its strategic framework. Below one can find ANCINE’s strategic map (in free translation), adapted from the BSC methodology:
37 Fig. 10 - ANCINE's Strategic Map.
Available from http://www.ancine.gov.br/ancine/gestao/mapa-estrategico (Accessed: 21 July 2016), in free Translation
As it is common for the BSC methodology, the strategic map tries to summarize in one page the broad elements of strategy, including mission, vision, values and objectives. In a brief overview, one will find core macro processes (i.e fomentation, regulation, access to audiovisual content and external communication) and key support activities that are expected to help ANCINE to achieve its strategic mission: “To develop and regulate the audiovisual market in benefit of the Brazilian society” (ANCINE, 2014).
Considering the scope of this project, it is not essential to dig further into each of the strategic map elements. On the other hand, it is relevant to know that among the many
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different sources of strategic prioritization (a typical additional layer of complexity for strategizing in the public sector), ANCINE defined the BSC as its main methodology and implemented the strategic map as the visual tool to reflect it. Guided transformation efforts demand the development and communication of vision and strategy and, as such, leadership must
The figure below summarizes part of previous research’s findings, including the key stakeholders directly responsible for strategic prioritization, the key sources of strategy and the movement towards BSC as the main strategic tool:
Fig. 11 – Strategic Prioritization
