The Steady State

Operational planning for each strategic initiative has to begin with a clear articulation of the steady state, without which initiatives are unlikely to achieve desired outcomes and the company is likely to see regression from desired state over time.

Among all topics related to Operational Plans & Execution, if one deserves a podium of its own, it is the Steady State. Small- and mid-sized companies should identify several initiatives to improve operational productivity as part of strategic planning. However, Gravity is a practical reality. What goes up, will come down, unless necessary amount of energy is expended to fight gravity and keep the object at the higher state. Execution of initiatives to improve organizational maturity and productivity has similar constraints.

What is Steady State?

Strategic initiatives are enablement projects, identified as part of strategic planning, that improve organizational maturity and productivity of Frontline ‘Variable’ Resources, and move the company closer to achieving its corporate strategy. These initiatives are never complete. They go through a heavy lifting execution phase to complete a certain set of tasks and deliverables to improve current state and achieve a desired state of higher productivity or organizational capabilities. At that point in time, the desired state has to be maintained through a different set of tasks, including memorializing the improvements into day-to-day operational processes executed by Frontline ‘Variable’ Resources. This phase beyond initial achievement of the desired state, where the company has to continue to work to maintain the desired outcomes is the Steady State.

Operational planning has to always start with a clear internalization of the desired state and how it will be maintained. Most projects are poorly run and in vast majority of situations, the root cause is a lack of clarity or vision about the desired goals. How can a runner prepare for a race without knowing the race distance, route, and target time? Further, many projects that achieve the desired outcomes by completion of execution phase fail to maintain it because resources that work on the initiatives shift their focus. Objectively, this is akin to unintentionally dropping the ball. Expecting changes to stick without ongoing effort to maintain the changes is a common operational fallacy.

Criticality Of Starting With The Steady State

There are no good reasons to not start with the steady state. However, it is worth highlighting the most important reasons to do so without fail.

  • What goes up must come down: As mentioned above, gravity is real. Initiatives do not end when the execution plan is complete. It moves into a steady state when: 1) desired, measurable maturity and productivity improvements are achieved; and 2) responsibilities are transitioned from execution owners to long-term owners who are accountable for results in a steady state. Unless the tasks to maintain the desired level of performance are executed flawlessly, the performance will quickly degrade back to the original level.
  • End justifies the means: A clearly articulated desired state allows for strategic planning to predict realistic resource needs and associated revenue targets. The Initiative-Resource Map, developed during strategic planning, is only as accurate as the company’s vision of each strategic initiative. Additionally, all Frontline ‘Variable’ Resources permanently operate in the steady state. An accurate depiction of the steady state is necessary to identify targets in the Leading Indicator Map, which then feeds the expense and revenue forecasts.
  • Avoid rationalization: Rationalization is the simple idea that humans tend to put a positive spin on situations when conditions turn sour. Execution can take longer than expected or high quality may be harder to achieve than anticipated. Unless a steady-state is well articulated, there is a strong likelihood that the company will settle for “good enough” results as deadlines slide and resource requirements rise. Starting with a strong visualization of the steady state helps the company and individuals involved hold themselves and each other accountable to achieve the original goals.

Frame the Steady State

Visualizing the end-state is not formulaic or complex. It just requires the strategic planning team to have operational discipline, maturity, and experience. Although a formulaic approach is not necessary, we can set some guardrails for minimum requirements with questions that every initiative should answer before attempting to assess Overhead ‘Fixed’ Resource needs for execution. The visual below provides a structure with themes that articulate what a steady state looks like. We can broadly classify key considerations into three areas:

  • Results: A certain set of parameters need to be achieved for each strategic initiative to be considered ready for steady state. To reiterate, a strategic initiative is never “done”. It transitions from an execution phase to steady state. First, those conditions on either side of the transition should be articulated.
  • Time: The speed with which the steady state needs to be achieved and the length of time that the company needs the steady state to be maintained, together form the second vector.
  • Resources: Different skills are likely required to execute different initiatives to achieve the steady state. Similarly, maintaining the steady state likely requires another set of skills. These differences need to be articulated clearly before diving into developing the Initiative-Resource Map.

Once the steady state for an initiative is clearly articulated, the specific owners, tasks, and deliverables for the execution phase should be reverse-engineered.

Enablement initiatives rarely achieve the true essence of the desired outcomes and even more scarcely maintain those improvements due to a lack of discipline in starting with an articulation of the desired state, and preparing for transition to and work in the steady state. Companies that internalize the importance of the steady state will have significantly more operational success.

Published By

John Oommen

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