‘We are all strategists walking around …’
In a series of interviews, I explore the approaches of different business leaders to strategy. This month I was in conversation with Freeman Nomvalo, CEO of SAICA
Having been in senior leadership roles in both the public and private sectors, Freeman shared his philosophy on various strategy-related aspects. I highlight some of his key insights:
Strategic plans should not be gospel
‘Planning enables you to get a sense of where you’re going and what you need to get there so that you can be better prepared for whatever you might come across. However, what is important is not to make that plan your gospel, because when you start executing, you might find that the environment is different to what you envisaged. Circumstances change and you need to be adaptable.’
Freeman continued: ‘One of the former American presidents, Eisenhower, talked about planning but never to completely trust the plans.’ He added: ‘But if you have a strategy, a plan, you are almost always better prepared because you would have thought about the things you’re going to need and some of the risks that you might come across and put them down in a plan.’
Be inclusive in strategy development
‘One thing that you must recognise, especially when you are at CEO level, is that you don’t see everything in the organisation, especially things that can trip you in implementing the strategy. It is therefore important that you involve a wide stakeholder grouping during the strategy formulation process, especially your employees. They know what is happening in the organisation better than you do. They know the issues that they encounter in their interface with stakeholders, with customers, and in SAICA’s case, with members, and therefore you need to involve them.’
He emphasised: ‘As you are taking stock of the environment you are in, the challenges that the organisation has been facing up to that point and figuring out what you can do to mitigate some of the challenges, it is critical to involve a wider stakeholder group during the analysis.’
As a practical example, he referenced one of SAICA’s member structures: ‘For instance, as far as SAICA is concerned, you have regional councils. The conversations on strategy with these councils are absolutely important as the councils fulfil two roles: they are stakeholders insofar as they are members of SAICA (when you talk to them you know what makes them tick, what needs they have) but they also represent a broader membership that interfaces with a membership that you might not have.’
Alignment is key
On the theme of strategy implementation, Freeman highlighted the importance of alignment: ‘Aligning the business units to the strategy is very important, because your delivery is going to be through these different business units.’
He then focused on the alignment of employees, saying that ‘a broader roll-out to the employee group and motivating the employees is critically important. Not only do you get the buy-in but also the alignment that enables you to deliver much more effectively.’
He then touched on process improvements. ‘Implementing a strategy does sometimes require a process improvement. You identify things that need to be done to take the organisation to another level, which may be different to the way things have been done before. This might require that you still use the same DNA but bring in new DNA to make it work better.’
He added a word of caution on measuring implementation: ‘Don’t make measurements the be-all and end-all. Measurements only give an indication − you might miss the opportunity to execute, especially if you measure outputs instead of outcomes. The interface between outputs and outcomes is important because that enables you to manage your strategy better.’
Importance of social impact
‘Any organisation which operates in any environment will affect more than just the stakeholders that they target. As SAICA, we are guided by the principle of protecting the public interest − that is how the profession came into existence in the first place. SAICA therefore needs to think about it in our strategy and that is why we have “relevance and reputation” as a strategic pillar. Let’s for a moment put reputation aside − relevance is about not only thinking about what assets do we have that can be useful in society but also what actions we undertake that could impact society, either negatively or positively. You can then build on that by reinforcing the positive and reducing the negative ones.’
He elaborated: ‘Examples for SAICA range from our involvement in the SDGs to our involvement in Unite for Mzanzi, bringing in a wider stakeholder group into these critical conversations. It is about thinking what SAICA can do broadly in society to impact it positively.’
On dealing with crises
On this topic Freeman offered several insights:
- Have an open mind ‘The most important thing is, like I said earlier, that strategy should not be your absolute gospel; it serves as a path you’re going to use to navigate potential challenges. But when the challenges begin to come, it is important to have a very open mind about them. Not all challenges are complex. If they are easy to resolve, get on with it, resolve them as quickly as possible. That will also strengthen the resolve of employees in the execution.’
- Take an experiential approach ‘You need to accept the reality that for some challenges you may not have the answers but rather a range of options to resolve them. You should not be afraid of experimenting if the challenges are novel challenges that you have never come across before.’ He used the example of a medical doctor to illustrate the point: ‘When you go to a medical doctor with a problem, the doctor does not always know what is going on with you. An experienced doctor will ask you a few questions, which is the diagnostic process, after which he will have a good guess of what is likely to be the problem, but he still doesn’t know for sure. Over time the doctor will guess with a higher degree of accuracy. This is the same for managing strategy − when you meet problems that are difficult to resolve, you need to take the experiential road. Over time you will become adept at it and it will seem like you have a solution, but you are actually still experimenting.’
- Use the energy of a crisis ‘There may come challenges that are really tough to deal with. You then need a different type of intervention to deal with that. Always remember, a crisis, even a manufactured crisis, creates energy we can take advantage of. An example can be to squeeze the budget a little or push deadlines tighter to increase the heat, the energy, to force people to think creatively and focus on solving problems.’
Strategy in different environments
Our conversation turned to the difference in strategy in the public and private sectors, to which Freeman replied: ‘The core principles of strategy apply across the board, but there are nuances that you need to think about. For example, the way you think about deploying assets in the public sector is very different to the way you think about deploying assets in the private sector. In the private sector, the assets deliver something tangible, profit. In the public sector, it is the service potential of the asset, what it can do to deliver services to the people. So the way you think about it does slightly differ. The core principles and dynamics tend to be pretty much similar, but the incentives are different.’
The conversation moved to entrepreneurs: ‘Entrepreneurial enterprises, especially in the early stages of the business, depend on the person who came with the idea. The entrepreneur drives the strategy, other people are enablers. It then depends on the maturity of the entrepreneurial endeavour − the more you bring in people, the more it starts looking the same as an ordinary organisation. In the early stages, it relies heavily on the individual and that individual does not necessarily have support. It is thus critically important that the entrepreneur look after himself, create time to recalibrate, and ensure he/she has the necessary soundboards in place.’
Advice for young professionals
We ended the conversation with advice for young professionals on their ‘strategic journey’. ‘The advice I would give is not to be threatened or intimidated by the big words like strategy and strategic thinking. It’s nothing more than an action plan and we all do that all the time. We are all basically strategists walking around, whether it’s short-term plans or medium-term plans that you have been making about various aspects of your life. For organisational strategy, you are doing the same thing on a much bigger scale and with a higher degree of complexity, but the basic principles will likely be the same,’ said Freeman.
‘Secondly, emerge yourself in some readying − you have the basic knowledge, but you need to build that knowledge. Lastly, have somebody as a sounding board – that sounding board is going to help you with things that you don’t find in a textbook.’
Author
Christiaan Vorster CA(SA), SAICA Regional Executive
