By Riaz & Linda Khadem
In an earlier article, “The state of Alignment in the Organization,” we have described the processes organizations can implement that establish the state of alignment. They include creating a shared and meaningful mission, vision, and values; building the infrastructure for Alignment through the Alignment Map; defining individual scorecards for all jobholders; and providing timely and relevant information through the software, TOPS. Brief mention was made of the twin processes of Team Review and Vertical Review for sustaining the state of alignment. In a separate article we gave further details about the Team Review process. Here, we provide more information about the Vertical Review process. This key process is a systematic one-on-one conversation of every manager with his or her direct reports. In this article we illustrate the connection of Vertical Review with Team Review as well as the cultural impact of Vertical Review on sustaining the state of alignment.
The twin processes will have the greatest impact on the success of the organization when the alignment infrastructure is in place. This means that every jobholder from the CEO down to the frontline manager has a scorecard that defines the added value of the job in measurable terms. The scorecard includes KPIs he influences directly in his position at the lowest appropriate level of the organization or strategic projects he influences directly at the highest appropriate level. It also includes KPIs and strategic projects he influences cross-functionally as a peer or vertically as a manager or dotted-line manager. It means that three goal levels, minimum, satisfactory, and outstanding, have been set for each entry in the scorecards. It means timely and accurate push-information on the performance of the scorecards is provided periodically to jobholders and their managers transparently and automatically through the software TOPS. These have been described in our book, Total Alignment.
Vital Units of Execution
In our article on the Team Review process, we referred to the vital units of execution in any organization which will number anywhere from a few to thousands of natural teams. Each unit is comprised of a manager and the people reporting to him or her. These units have tremendous power in helping the organization advance towards its vision. We reinvented the workings of these teams by turning their focus upward toward improving the scorecard of their leader instead of the scorecards of the individual members. Vertical Review complements the working of these teams by focusing downwards on the scorecards of each team members in a separate space. This process is essential for vertical alignment to be maintained in the organization.
Suppose you are the manager in one of these vital units. In Team Review, you and your direct reports work together to develop action plans to help you improve the performance of a KPI in your scorecard. During Vertical Review, you meet with your boss (one on one), present the action plans, and welcome his input to improve the plan and support it.
The conversations in Vertical Reviews are specifically designed to address the needs of the jobholder through systematic accompaniment. Everyone needs accompaniment from someone with more knowledge and experience. The accompaniment in Vertical Review varies from continuous supervision for beginners to encouragement and support for competent jobholders.
Your boss also has his own Team Review in which you, your peers as well as cross-functional influencers of a KPI, help to develop action plans for improving his scorecard. Then, in a Vertical Review of your boss with his boss, this plan is reviewed to receive input and support. This upward cascading process continues up the line to the CEO level.
The Structure of Vertical Review
While every Vertical Review is different, they all follow a uniform structure. They are comprised of four conversations, Culture, Performance, Development, and Other important topics. The time allotted to each can vary depending on the needs of the direct report, but all four conversations are indispensable for sustaining vertical alignment.
The culture conversation is a reflection on the core values of the organization. Its aim is to assure alignment with values. This is important because paying lip service to values and violating them when it is expedient is an affront to the integrity of the core values and robs the organization of the energy needed to fulfill its mission.
One of the elements of the infrastructure of alignment mentioned in our book is a value tree that is constructed such that the main branches are the core values, and the sub-branches constitute the pinpointed behaviors that demonstrate them. During the culture conversation, both the boss and direct report reflect on the values as described in the value tree and discuss what pinpointed behaviors related to a core value look like in the work setting. This conversation serves as incentive for each person to advance his understanding of the values, and to strive to be a better example of putting them into practice.
The second conversation is about the performance of the scorecard of the direct report. It is not a forum for viewing the scorecard for the first time. Prior to the Vertical Review, the boss will have received notification of the positive and negative recurring exceptions in the scorecard of the direct report through TOPS. The direct report also will have fully studied his performance status. As stated above, he will have picked a KPI with his role of direct influence and will have conducted a Team Review with his own natural team as well as those who have indispensable influence on the KPI cross-functionally to develop an action plan for improving the factor. The performance conversation of the Vertical Review serves to study this action plan already developed. The conversation provides the opportunity of not only informing the boss of how a problem is being solved, but also obtaining his input for improving the action plan.
The third conversation is about the developmental needs of the collaborator. It is a forum for the boss and the direct report to identify the key skills needed by the direct report to improve the factors of his scorecard. Once the skills have been identified, they are evaluated together on a scale of beginner to fully competent. The evaluation serves as the starting point of advancement to higher levels of competence. The direct report is asked to prepare a plan, taking full advantage of the training and development services provided by the HR department or other sources, and to review the progress of the plan in further cycles of Vertical Review.
The fourth conversation is about other important topics. This is an important space to allow the direct report or the boss to talk about topics important to them.
The Culture of Vertical Review
The cultural characteristics of Vertical Review are substantially different from most one-on-one encounters that take place in organizations between a boss and his direct reports. While in the traditional one-on-one meetings between the boss and the direct report, the boss often sets objectives, and dictates courses of action, none of that is necessary in a Vertical Review. The direct report already has a scorecard that lists his objectives aligned with the vision and strategy of the organization, and he is empowered to determine the course of action with the help of his team in his Team Review.
While in a traditional one-on-one meeting, the boss evaluates the performance of the direct report, this is not necessary in Vertical Review as evaluation is already done by the performance of the scorecard and is available to both through the TOPS software.
In Vertical Review each participant adds value to support the processes of alignment. Among the contributions of the boss to the conversation in Vertical Review are perspectives he shares based on his scope, that is, based on where he is standing. It is a perspective the direct report doesn’t have. It is like a person standing in a second level of a building looking through the window down at the parking lot. He has a wider scope seeing what the person on the ground cannot see and can even predict accidents waiting to happen. The boss can add such value based on his perspective. Additionally, he can give advice based on the knowledge and experience he has acquired.
Among the contributions of the direct report are input based on the reality he sees at his level. Following the example stated above, the person at the parking lot can see conditions on the ground more clearly than the person on the second floor. The information the direct report can offer helps to inform the boss what is needed at the level of the direct report. This provides upward flow of information in the organization from the frontlines through the levels above.
The boss and the direct report are equals. They are collaborators in serving the organization. Both have much to learn. Among the learning objectives of the boss is how to facilitate the Vertical Review to provide systematic accompaniment for the direct report. Among the learning objectives of the direct report is how to receive the accompaniment for improving his competence in handling his scorecard and for developing general skills he will need when promoted.
We refer to the conversations aimed at arriving at specific actions, consultation. The guidelines for consultation described in our previous article are equally valid in Vertical Review except that some additional items might be needed, and some others require higher priority. Here is a sample that might be appropriate for a Vertical Review:
- Be on time for the meeting.
- Do not cancel the meeting except for emergencies.
- No cell phone use during the meeting except for emergencies
- Do not interrupt the meeting.
- The purpose is to find the best solution.
- No hierarchy
- Listen to understand not to respond.
- No put downs in words or body language
- Be detached from your idea once presented.
The first four are particularly important as managers with their busy schedules and often influenced by the false traditional mindset of boss vs subordinate might have the tendency to arrive late or be tempted to cancel a meeting with their direct report, something they would not do with their bosses. Also, they might feel that it is okay to have the meeting interrupted by answering their cellphones or excusing themselves to attend to other matters.
Most people would agree with the guidelines for consultation. Therefore, it is not difficult to establish them upfront. However, it is often challenging to change the behaviors of managers.
To assure the adoption of these guidelines in all Vertical Reviews, the three roles we discussed in our article on Team Review apply equally here. The boss is the facilitator who creates an agenda based on the performance of the direct report’s scorecard and sends it ahead of time. He or she facilitates the meeting respecting the agenda and the guidelines for consultation. The monitor who observes the meeting is the direct report who is empowered to request a pause and point out any deviations from the consultation guidelines. The recorder is also the direct report who manages the software during the meeting, displays screens from the TOPS software along with the action plan created in his Team Review, and enters the commitments generated from the meeting into the software.
The Learning Model
Vertical Review also follows the three elements of the learning model: Consultation, Action, and Reflection. * The Consultation element focuses on the action plan already developed by the direct report in his Team Review. It also includes conversations aimed at improving the action plan with the boss’s input. The Action element is looking at the action items implemented. The Reflection element is reviewing the outcomes of the implemented action items and articulating the learning that has taken place. The cycle repeats itself in future Vertical Review sessions as the learning feeds the consultation.
The outcomes of the Consultation, Action and Reflection model from each Vertical Review are concrete action items or commitments for the boss or the direct report aimed at implementing the decisions made through consultation. The commitments are entered into TOPS by the direct report along with deadlines. After the Vertical Review, each party implements the commitment and posts its completion into TOPS along with the documents that show how the action steps have been done with quality. TOPS provides notifications and reminders to each person’s smartphone via the TOPS mobile App.
The Power of Disruptions
When Team Reviews and Vertical Reviews are cascaded throughout the organization from the CEO to the lowest level, there is a natural disruption of the way things are done from period to period in a company. The disruption has immense power as experienced in organizations that have adopted the change. **
During the implementation of Total Alignment, managers might experience discomfort in adopting the change and adapting to it. Often, they will need to embrace the new management model while continuing the old one. However, as they experience the benefits of Vertical Review and Team Review, the old ways gradually fade away and disappear naturally.
Summary of Benefits of Vertical Review
- It changes the posture of jobholders from being passive recipients of directions coming constantly from the top to active protagonists of their own scorecard.
- It reinforces the ownership of performance and empowerment at the level of the jobholder.
- It focuses on solving problems for the future and changes the culture of excuses to one of solutions.
- It enables jobholders to receive valuable input and advice from their boss to improve the quality of their action plans.
- It unites the boss and the jobholder in assuring excellent execution resulting in improved scorecard performance.
- It changes the role of the manager from evaluating, controlling, directing, and even micromanaging to supporting and encouraging.
- It relieves managers from many of the traditional responsibilities and allows them to take advantage of the time saved by increasing their span of control or spending time on other important issues.
- It facilitates the flow of information from the grass roots upwards in the organization.
- It contributes to a systematic process of talent development.
- It enables good management practices to be extended to all managers in the organization.
- It sustains vertical alignment in the organization.
Impact of the Twin Processes
As stated in our earlier article, “The state of Alignment in the Organization,” organizations of any size and in any industry can facilitate the state of alignment in their organizations by first constructing the infrastructure for alignment as explained in the article mentioned above as well as in our book, Total Alignment, Tools and Tactics for Streamlining the Organization.
The twin processes that sustain the state of alignment are Team Review and Vertical Review. Operating in a state of alignment has immense power and produces outstanding results. **
* Baha’í Writings
** See 2023 case study of ProlecGE, the largest transformer solutions company in the continent written by IPADE Business School in Mexico
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