Previously published in PA Bankers Association’s paBanker.
Socrates explained the role of the CEO best when he said, “To know thyself is the beginning of wisdom.” This same philosophy holds true for understanding the underpinnings of corporate identity, or the DNA of Performance. In order to comprehend this identity, an organization must first gain a clearer understanding of its essential business activities, which create organizational focus and discipline and strongly influence the corporate culture.
The rationale for this evaluation is to resolve an apparent paradox: how could one highly successful organization rely heavily on a consensus-driven strategic path as the highest operational priority, while another organization follows a structured pursuit of business opportunities as its driving force and reach a similar financial outcome? Effectively managed organizations simply understand their DNA and play to their business model orientation.
The benefits of one approach over the other can be debated, however, not the consistency of financial performance or the long-term sustainability of the company. Since the choice between these operating approaches is not binary, but rather a spectrum of varying approaches, these nuances form the sharpened focus of the strategy itself. Rather than chasing down endless financial metrics and juggling peer groups, simply consider the collective make-up of the leadership group. By understanding the differences between ten pairs of factors (see Figure 1), your leadership group can gain a clearer understanding of the impact of certain organic and operational choices and how they create the company’s unique (there are 1,024 possible combinations) DNA profile. These choices undeniably have both performance and risk connotations.
The question is, “Which best describes your organization?” The results are not intended to provide a score or index, but rather an assessment of the organization’s current situation and operational tendencies. There is no single-best combination of these factors. The organization’s leadership may choose to accept the situation or adapt in order to change the performance results. For just as performance factors can be adapted to achieve personal success, organizations can shift focus from the collective personalities and style of the leadership group to fundamental business activities as described by the pairs of descriptors in the following chart. The objective is to select which option more accurately describes your organization’s current situation. From there, decide how to best achieve the organization’s performance expectations using or overriding its DNA of Performance.
As your leadership group completes the assessment, the organization’s strengths and weaknesses come into clearer focus. Now the group is better able to make choices as to whether to play to the organization’s strengths or adapt these business activities. Ultimately, the objective is to position the organization to achieve sustainable, next-level performance.