“Org DNA”: Building the Four Bases of an Execution Culture

The Big Idea
A great strategy alone cannot guarantee a company increased revenue, profits, or share. It’s effective execution that distinguishes the best-performing companies. Superior and consistent execution occurs only when each individual acts in alignment with the overall strategic interests and values of the company. The first step toward alignment is to understand how the traits of an organization influence each individual’s behavior and affect his or her performance. Booz Allen Hamilton’s Org DNA framework describes four elements that, combined in myriad ways, define an organization’s unique traits. These elements are:

Decision Rights: The underlying mechanics seldom captured by the organization chart of who really makes decisions and how.
Motivators: What objectives, incentives, and career alternatives do people have? How are people influenced by the company s history?
Information: What metrics measure performance? How are activities coordinated, and how is knowledge transferred?
Structure: The overall organization model, including the lines and boxes of the organization chart.
A proprietary survey methodology can rapidly identify the specific ways these four bases of Org DNA recombine to create a company s personality. Thereafter, a full menu of processes, systems, and tools can be applied to identified problem areas to help a firm improve its execution culture.

The Case

A leading U.S. health-care company had difficulty executing such enterprise-wide initiatives as standardization of operations, implementation of best practices, and centralization of support services. Asked to assist in developing a new internal governance model to improve execution capability, a joint Booz Allen and client team, through senior management interviews and workshops, identified several problems:

A very entrepreneurial culture that devolved power to the local level had been important to the company s success, but was now creating tension between corporate and field units.
Confusion about who had what decision-making authority and limited accountability for cross-functional decisions resulted in decisions getting bogged down in committees or challenged and overturned by informal channels.
Decision-makers optimized from the perspective of their discrete silos, but cross-functional decision quality was poor.
The joint team assessed and developed recommendations defining decision rights and accountability. Without changing many organizational lines and boxes, the team recommended new process owner roles to ensure accountability for enterprise-wide improvement efforts and important cross-functional decisions. The team also developed detailed new performance metrics and new decision-making flows to show who proposes, who validates, and who decides. New committees were established to share information needed for effective decision-making. The next annual planning cycle will see realignment of motivation mechanisms to ensure accountability for implementation of decisions.

The Application

A recent Booz Allen online survey revealed that over 60% of companies across industries exhibit unhealthy organization profiles. While the Org DNA approach is applicable across all functions, it is proving particularly valuable in:

IT because of the unique governance challenges and high spends associated with information technology
Finance because of the changing role of CFOs in light of Sarbanes-Oxley
Human resources because of enhanced HR responsibility for overall organizational effectiveness
Market-facing functions because of the perennial struggle between field and corporate units