Based on our client work and an ongoing study of hundreds of major change efforts around the world, we have identified five actions that SIOs must take to be effective.
Choose and support the right leader. The SIO leader must be an effective navigator of the organization, have explicit authority and credibility, and report to the CEO or a member of the executive committee. Project management skills are less important than a deep understanding of the strategic value and goals of the change effort and the related business issues, strong communication and persuasion skills, a respect for people, and a tenacious ability to solve problems. An effective SIO leader sees the big picture without losing sight of the details. In addition to ensuring that the right leader is chosen, top management must actively back and lend credibility to both the role and the person, and explicitly plan for the leader’s next career step. The position of SIO leader should be a pivotal, career-building role. Finally, the creation of a role mandate for the leader can help clarify expectations and increase credibility. The role mandate should capture critical individual and shared accountabilities, key parameters and performance indicators for success, and essential decision rights of the role.
Keep top management actively involved. The SIO must actively involve senior managers and keep them from having their attention diverted—a major challenge given their competing demands and extremely limited time. It’s important to create a structure that keeps top executives hooked in and to update them regularly with a schedule of critical milestones, planned financial impacts, and clear accountabilities. Information—the right information, delivered in a timely, useful format—is critical to success. The SIO should not waste time with low-value status reports of on-track initiatives. Detailed activity plans are important for day-to-day execution, but they’re not what leaders need in order to lead. Instead, the SIO should give leaders exception-based reports that highlight what’s needed to get initiatives back on track. It should provide the smallest amount of critical data needed—the minimum sufficient—to drive impact and accountability. The goal is to have senior management expend the minimum effort for maximum results.
Focus on what matters. Too often, change efforts get bogged down with hundreds of issues, all marked “top priority.” An effective SIO ensures that strategic, economic, and operational priorities drive the approval of only the most important, highest-impact initiatives. It then applies a rigor test to guarantee that initiatives are focused on the critical dimensions that drive success: time to results, progress toward critical milestones and bottom-line impact, and lead indicators that can flag structural or behavioral issues. By focusing on the information that really matters, the SIO delivers the insights needed to identify risks early on so that course corrections can occur in a timely manner. (See Exhibit 2.) The bank mentioned in the opening paragraph found that more than one-third of its 635 projects failed the rigor test. By redesigning, delaying, or killing these projects, the bank was able to direct more resources and executive attention to the most important projects with the highest impact.
Mind the gaps. A challenging—and often hidden—problem in any complex change effort is the interdependencies among initiatives. Most teams are caught up in their own piece of the effort and lack the big picture needed to pull it all together. The SIO adds value by actively seeking out team leaders and identifying potential gaps so they can be resolved before they cause problems. The SIO’s high-level, cross-initiative perspective helps it ensure that these critical gaps are identified and addressed so that nothing falls through the cracks. But it should avoid the tendency to overengineer this process and make explicit only the most critical cross-initiative or cross-business interdependencies. Simple initiatives with a small scope (within a business or function) and few interdependencies rarely need coordination by an SIO.
Play an “informed activist” role to maintain positive momentum. In our experience, change efforts that don’t start showing results within six months lose momentum. Although the line is accountable for program execution, the SIO keeps things moving forward by flagging potential problems early and involving the right people to fix them. The SIO is in a position to successfully escalate key issues and orchestrate discussions so that decisions get made. By providing a rapid pace, structured processes, clear accountability, and respect for the individual, the SIO helps minimize the common problem of good employees who end up doing the wrong things.