12. Fanny Wallér, senior board professional about strategy, OKRs and transformation

Hi I'm Sophie and I work at Noxit. We help companies cascade their goals in a clear and effective way. In this podcast series I talk to inspiring guests about how they work with goals and what actually makes it work in real life. Today I'm joined by Fanny Valien. She is a season board professional with tons of experience and we will talk about the board and the board's role in goal setting. We will also talk about objectives and clear results, OKRs and how to successfully work with this method and also how boards can support real progress. Back it up it's time for Ready, Set, Goal. Fanny Valien, very welcome to Ready, Set, Goal. Thank you very much. Can you introduce yourself and tell us what you do? Yes of course my name is Fanny Valien and I'm a senior advisor and a board member in different companies. I work on advising on strategy, communication, marketing and sustainability. I've been working on boards for four years and I have an operational background as leader in the finance industry basically. Can you let us know what the kind of companies you are involved with today? Today a lot of different companies actually. I started off when I left my operational career in the finance sector I wanted to move into tech from legacy basically. From the beginning it was a lot of tech but now I'm in a very different type of companies. Everything from distribution to foundation to listed companies and listed companies privately owned and so on. A bit of a difference depending on company. This podcast name is Ready, Set, Goal. It's basically around goals. What does goals mean to you both personally and professionally? I think that goals is something extremely important but I think it differs a lot between what is professional goals and personal goals. Professional goals require a lot of attention and professional work to succeed while personal goals is something very different. Personally for me I strive to focus on what's important but not urgent instead of always being in the important and urgent because that's a way for me to achieve my long-term goals. That's a really good reflection. I think most companies today are in the urgency box and then it becomes also business as usual and this whirlwind of things that just happens all of the time. You need to answer emails, attend meetings and then your day is totally gone and then you haven't done anything that you maybe wanted to do. The whirlwind is steering you instead of you are steering the company. Exactly. If you really try to be in the important not urgent square then I think you have a much better chance to achieve your long-term goals. Of course understanding that many things are urgent but it's exactly as you say. The daily business sort of tends to drown you. I think McKinsey have three strategic horizons. They have Horizon 1, Horizon 2, Horizon 3 and Horizon 3 is kind of the long-term goals. It would be what kind of company would we be in five to seven years from now. Why the Horizon 1 is very daily, weekly, here and now. It's paying everyone's salary here and now because it's kind of bread and butter for the company. While the management team and the board works in Horizon 3 and the middle managers would be somewhere in between in Horizon 2. I see that a lot of people struggling to understand each other when it comes to goal setting because Horizon 1 wants to set goal setting within this urgency box. The board and the management team can proceed very fluffy setting goals in Horizon 3. How do you think boards and management teams should work with goals? First of all, I think it's very important to differ between what's the management's work and what's the board's work. So basically the management's work is to set the strategy and propose the goals to the board who's supposed to approve them, understand them, and then approve them. Then of course follow up. So it's a big difference between the task of the two. When the management team and the CEO set the goals, that is based on the strategy, or is it the owner or directive, or how should the management team set these proposed goals, do you think? Yeah, it's a very good question because it all emanates from the wish of the owners. That is also a simple way of expressing it because the ownership might vary. You might not have a very clear owner, but of course it's easier for the board if you have a very clear ownership directive. It is from that that you will form the strategy basically. But the job will form in it and proposing the method and the goals, that's the management's job. So the difference is with the operational work basically. And I know you have experience with a method of objectives and clear results of the OCRs. There are several different methods. Some are really similar to OCRs that must win battles, and then we have balance core cards. Here are some methods out there. How come you work with objectives and clear results? Since I've been a leader for more than 20 years, I've always been interested in how to lead for success. Then of course you look at different methods, and then I came across OCRs and thought it was a very good method. And of course like every other method, it depends on how you handle it. But I think it's a good method and tool to have in an organization to basically implement a successful business. And how was that decision made? Because there are some stakeholders that need to think this is a good idea. How do you take the decision to implement this method? Well I think normally in a board, if the board works well and the board works well with the CEO, normally the decision in itself is not the difficult thing in my point of view. The difficult thing is to face the challenges and do a proper job with the goals. And the main challenge is lie of course in setting a defining a few goals. There is the cover method talking about wildly important goals, so I think that's quite good. So that's a challenge. And then the next one is to anchor and create the engagement in the organization. And the last one of course to follow up by the structure, the routines, the frequency. So one shouldn't really underestimate that challenge I would say. No, I agree. There were them that you talk of here as the third point in the OCR framework. It would be the planning, it would be checking in, it would be reviewing and then start over with planning, checking in review, planning, checking in review. How do you, I think companies get better over time, but here is where I see companies fail because they don't stick to the ceremonies. Do you have any advice here? Why is that so difficult? Yes, but I think you are pointing out something very, very important here because the easy thing is really to set up those routines and set up the frequency. But if people are not engaged, if they can't relate to the goals, they won't care. I mean they want to or not or they will just change the frequency so that the really difficult thing is like always, you know, it's the change management, the behavioral change. And I think that's the difference also between companies that really, really are successful and grow a lot. They have this engagement. People know, they understand what is my task in this organization and then how can I contribute to this? But I mean if you don't understand that, it doesn't matter how many meetings and, you know, the clipboards you have to discuss the results. And of course, it's also very much about the leader in the organization, being able to stand on the barricades and always, always lead the way. So that's also an important thing. So one thing is really the hard facts. And the other thing is the, as always, the culture. You know the expression, culture, eat, breakfast, is strategy for breakfast. Yeah. And how do you get that engagement? Oh, my God, that's the most difficult question. Is there a single answer? Yeah, I think the definition of the goals is very important. I mean, if you set goals on a paper and people are not engaged in them. So when you set the goals, you really need to get all the organization to be on board. So you can't, I mean, many organizations, they set the, it's quite common, actually, and not strange. I mean, as you set the goals in the leading team, and then you present it to the organization. So I think the clue here is to get people on board and engaged and wanting to really, really wanting to contribute to the goals. And I think then I come back to what we talked about a few minutes ago when it came to where the different horizons. So I experience a lot, when I talk to the management team, they want to set very transformational goals or objectives. Let's say a transformational goal would be launch in Germany. If our business is not in Germany, that could be something transformational, transformational goal. While the ones working in the horizon one would be much more KPI driven and what they are doing every day. But maybe they can be transformational in their role as well, but they are not the one that will open up the office in Germany. If you understand what I say, so I can see that is still difficult for me today because you want people to be included, but the OCR framework is quite strictly transformational, wildly important goals. But I can see a point where companies set broader OCRs on company level when it's a big company. Then the next level of leaders in their teams, they can be more transformational in level two if you understand what I mean. So I think if you're a really large organization, then we often end up with OCRs that are more kind of broad at level one. If it's a small company, you can much be much more transformational in level one, straight away. I don't know if that makes sense. But yes, I think I understand what you mean. Although in my point of view, I don't like really to say transformational for one activity. In my point of view, either you are in a company that is in a transformation phase. I actually work with such a company presently and we are really, really transforming from what we were to what we want to become or what we are and want to become. So that's a transformation. So for me, having an activity, we want to expand in Germany or we want to change something. That's more of an activity. So I think that the first thing to do is to decide is this company in a transformation phase or not. Because that's really the overall, that gives you the overall picture. The other thing might be to engage in an activity and part of the organization needs to do that. That's my view on it. But aren't all companies today needs to be changing, right? Could it be a company that is kind of. Yeah, just I agree. I agree. You have to be in a constant sort of change to be able to survive in the long term and always have an outside in view on the organization. That's also why I think my role is quite important as an external board member because I come from the outside. So I bring totally different perspectives, being both nice to here and perhaps a bit annoying to hear. So of course, yes, you need to be in a change mode, but a transformation perhaps we're stuck on words here. But transformation, for me, is to shift from one thing to another. So then perhaps it would be so that you talk about continuous improvements. That's why like the Toyota method, they talk about continuous improvements, small, small steps. I mean, not all companies want to make a complete transformation. They want to succeed, they want to grow and then you should, of course, set your goals according to that. I mean, setting goals is quite difficult because it varies so much depending on what kind of organization you are in really does. And that's why also I often say that working with goals is an underestimated job. I think that generally organizations tend to spend too little time on this. Not enough time, not enough effort to look into it, to ensure that it's well done, to ensure the leadership and the follow-up. That's a good advice for leaders out there spend more time on goals. I mean, effort, I would say, time and effort. What other advice would you have for a CEO leading this goal setting process? Yes. Very good question which ties in basically on what we've talked about, but it's, of course, limit the amount of goals, you know, back to the wild, the important goals again, ensure that everyone in the organization can relate to the goal. I think it's very common that people can't relate to the goal. It's something very far away. It doesn't concern me. So, and if it doesn't concern me, how can I contribute? So, that's one thing. And then for the CEO, which is difficult to tell the CEO, but normally you really need to stand on the barricades and lead the way. And leaders who can do that, you know, who can stand there and even an employee out in a subsidiary, some far away in another country sees it and understands how he or she can contribute. Then you really have done a good job at the leader. So, work on your leadership, set the routines as we talked about, set the routines for the follow-up. And then I think also one thing is quite good to have. And that's the sort of visualisation. So, like a roadmap is quite good, because that makes people see how can we, how can we move? Not only work on the KPIs, which you, of course, shall do, but you can also work on the activities and see what does a roadmap look like the coming three years, for example. So then you are sort of part of the movement in the organisation, the change, if you like. And there, in that roadmap, you can, of course, pinpoint the activities that point out the change for this company, if you can. Because I mean, the world is changing so fast now, so you need to, I mean, you need to change all the time. You need to be very perceptive of what happens out there, with that reservation. Good. And what's the board's part of this? So the CEO, that's a good advice for the CEO, how can the board support the management and the CEO in the goal setting? I think, firstly, the board needs to understand what it's all about, not just, you know, turning up and saying, yes, this is fine. We really truly understand it. So one can support the CEO and support the organisation and be part of the success. So really understand. And then, of course, it will be the board's responsibility to follow up. So already from the beginning, you need to, as a board, understand, how do we follow this up? Because you might end up in situation where you're not succeeding. And then the board needs to understand why, why don't we succeed? What's happening here? What kind of follow-up do we have? So the board really needs to be part of the follow-up and actually do it also. Because there are, of course, situations where you're not succeeding. where you don't succeed. And then you really need to look at why. Why is it that we don't succeed? Vista and Minutes flies away. Thank you so much for being a part of the Ready Set Goal. Thank you so much. Nice talking to you. Same here. (gentle music)