The Cost of Misalignment
25% of Revenue…
How much lost revenue do you think comes from strategic misalignment, within your company?
Estimates go as high as 25% of revenue according to Predictive Index. And as HBR points out below, the reasons are probably familiar to you.
This can’t be true?!
( we see it all the time and we know what to do about it)
We’ve seen that most strategies are really just goals and they’re severely lacking the decision framework that defines what the org will and will not do to achieve them. In recurring revenue businesses where the customer journey is long, the teams with ownership for stages of that journey often run in conflict with each other and aren’t clear on what each needs to do to hit a net growth North Star.
PWC findings confirm it’s a broad problem:
74% of executives admit their strategies are not well-translated into concrete actions
67% of integral functions in most organizations aren’t aligned with corporate strategy (wasted labor)
79% of executives are concerned their organization doesn’t allocate sufficient resources to implement their strategy
Here’s the kicker:
These strategic goals are almost exclusively developed without aligning to the customers’ jobs to be done!
Do yours?
Considering all of that, 25% of revenue actually looks pretty realistic as the opportunity cost for strategic misalignment. It could be worse is some cases. But it just doesn’t have to be this way.
The first stop in unlocking new sustainable net growth is the alignment of goals from the customer to the business and through the teams responsible for each stage of their journey together. Easier said than done, it may seem. And yet I’m sure we agree that it’s critical. I was delighted when the folks in our most recent workshop kicked off a great conversation about the opportunity for subscriber centricity and the potential for that to help with organizational alignment and adoption — providing more appreciation for the “why” of their efforts.
The lowest hanging fruit for more sustainable growth may be right within the way your teams are aligned, or not, with the customer goals. Reach out if you want to discuss more, we have ways to work it out.
Thanks
- Matt
P.S. Don’t miss the next AMA with Nicole Orders, Product Lead at The Washington Post.
P.P.S. We’ll touch on Goal Alignment and much more during our workshop on our sustainable Subscriber Growth Framework May 17-18, learn more and grab your seat here.
