From the CEO and company perspective, establishing a quarterly rhythm for operating reviews will help you realize your most important longer-term goals faster and better. The power of the operating reviews comes from their ability to:
- Align each operating unit’s quarterly goals with the current state of your markets, other operating units, and the company’s longer-term priority goals.
- Focus each operating unit on the most important goals to accomplish the following quarter and minimize other activities that distract from the focal points.
- Ensure that each unit 1) is clear on its goals, 2) has the appropriate resources, confidence, and conviction to realize those goals, and 3) has taken responsibility to achieve the goals.
- Maximize the opportunity for each unit to accomplish its highest priority goals.
From the department manager’s perspective, operational reviews give you the opportunity to:
- Gain a clear perspective on where you are and where you want to go by stepping back from your day-to-day management activities to assess your unit and its goals.
- Gather ideas and perspectives from other senior managers and outside advisors to help improve on the list of the best goals for the following quarter.
- Identify your best prioritized goals and initiatives to move them forward over the next 90 days.
- Ensure that your unit’s quarterly goals are aligned with the company’s most important long-term goals.
- Agree on the resource requirements and activities from outside the department (e.g., other departments, outside advisors) that will be available to help realize the goals.
Much of the business benefit of operating reviews comes from the meeting preparation phase. It is difficult for operating units to step away from the day-to-day running of the business and to consider the unit from a broader perspective. Operating reviews help create this discipline.
Significant business benefits also come from the perspective of other operating heads and the outside parties (board and outside advisors) that have unique experiences with other companies and can offer their views on the unit and the best goals for the unit going forward.
Operating Reviews as a Company-Level Strategy
Quarterly operating reviews help the management team stay aligned with and focused on the company’s annual goals, which in turn are aligned with the company’s longer-term strategies and corporate vision. Quarterly operating reviews provide a major opportunity for the team to step away from tactical execution every 90 days and set the absolute best goals for the company given its current state and longer-term goals.
The proper execution of quarterly operating reviews is part of an overall management rhythm that maximizes the company’s velocity toward its longer-term goals, which can create a significant competitive advantage.
Continue to Part 3: Customizing Your Approach to Quarterly Reviews
Stay tuned for more information on conducting quarterly reviews to help grow your company and improve your overall business processes. Next week, we’ll offer some ideas for customizing your approach to holding operating reviews at your company.