The Concept of “Organizational Clarity”

Over the past 18+ years, Ephor Group, in cooperation with the Wharton School of Business at the University of Pennsylvania, has developed, refined, and implemented the Concept of “Organizational Clarity,” intended to develop scalable and capable service business models that have sector and societal transformational impact.  Below, we have outlined the “Organizational Clarity Concept” in executive summary format. 

Components of Organizational Clarity

Organizational Clarity has 4 components that must work conterminously and are mutually dependent upon each other for transformational, sector leadership performance while creating exponential shareholder wealth.​​

  1. Strategic Clarity ​

  2. Operational Clarity ​

  3. Tactical Clarity​

  4. Financial Clarity​

 

The Outcomes of Organizational Clarity include:

Organizational Clarity,  due to its holistic approach to business model development, creates an impressive list of potential outcomes, in additional to institutional level wealth. ​

  • A Sector-Impact Organization Resulting from a Transformational Business Model ​

  • Exponential Institutional Shareholder and Individual Wealth Creation​

  • Significant Economic and Societal Success and Outcomes​

  • Legislative Influence at the Sector Level​

  • Consolidates Large, Fragmented, and Addressable Market Opportunities 

Strategic Clarity

Strategic Clarity includes:

  • A clear, concise Mission Statement that describes the company’s mission, and for whom it provides value​

  • A differentiated Value Proposition  ​

  • A stated and adhered to Core Set of Values and Principals ​

  • A well-defined Strategy inclusive of Corporate Development and Structured Governance Functions​

  • A defined set of Goals, generally <5 in number ​

  • A pragmatic set of Objectives, generally <6 in number ​

  • A well-defined, scalable, technology-enabled and differentiated Business Process and Model, that differentiates the company from mediocre sector participants  ​

  • Creates a Business Process and Model that is not "People Skill" dependent​

  • A highly skilled Leadership Team that utilizes “Outside Expertise” and that is empowered within the organization

 

Strategic Clarity Outcomes include:

  • A Branded and Differentiated Organization that is known and accepted as a significant sector-impact Influencer ​

  • An “easy buy” Decision for the Customers and Clients: attracts Customers, Channel Distribution Partners, Technology Partners, and engages Sector Leadership​

  • A noted Place to work, which attracts and retains the best Employees, the most talented Sector Executives and Advisors​

  • Significant Wealth Creation ​

  • A stated and adhered to “Yellow Brick Road” to achieve the stated Organizational Objectives​

  • Leadership that is focused on the Success of the Customers, the Employees, and all Stakeholders: Illustrates Stakeholder Balance​

  • Leaders who have “surrendered the sovereignty,” and have empowered proven professionals and outsiders to maximize the potential of the business model, and market opportunity.

Operational Clarity

Operational Clarity includes:

Brand Awareness: A precise understanding of the Target Market(s): sector dynamics, opportunities, competition, shareholder value “drivers,” leadership capabilities, thought and knowledge leaders, and that has expert knowledge in the governance process and expert knowledgeable advisors.   ​

  • Ability to choose, profile, and identify the “Targeted Customer” at the product or services level.​

  • The ability to manage and influence the “Customer Maturation Lifecycle”​

  • Marketing Assets and capabilities that include at a minimum:​

  • Brand Equity & Brand Awareness Programs ​

    • Effective Market Messaging​

    • Technology-Driven Marketing Assets​

    • A Lead Generation Process that provides 10x the Amount of Revenue needed to meet the Growth Objectives of the Company​

    • Professional Marketing Expertise (either outsourced or internal staff)​

  • Process & Technology centric Client Relationship Management and Client Account Management ​

  • “Best of Breed” Service Delivery or Product Quality/Performance function that is the organization’s most noted “Brand Equity”.​

    • Is Process-Centric; not people-centric​

    • Enhanced by the Application of Technology​

    • Enables “B” level skills to perform at “A” levels​

  • Has a well-defined and proven scalable business process and leadership execution of a “Portfolio-Driven” Go-To-Market Franchise Effect, which includes:​

    • Direct Sales: Talented, Proven, Results-Oriented​

    • Inside Sales and Business Development Activities​

    • Channel & Alternative Distribution that provides a portfolio of distribution partners​

    • Strategic Partnerships and/or Joint Ventures: minimum of two highly productive partnerships are required to be transformational​

​

Has Defined and Implemented a Structured Management & Communications Process & Rhythms. Leadership that is Management Science-centric, that enables Leaders to be “effective” through management science and process, not position power or narcissistic control behavior.​

  • 8-10 high defined and monitored Measurements and Metrics at an organizational level, which measure the business model, not the business​

  • 5-7 Key Operational Measurements and Metrics within each Function​

  • The Definition of Success, Mediocrity, and Failure: each of these is highly defined and understood, not subject to management opinion or “how management feels”​

Customer and Employee Satisfaction are priorities of Leadership, not the leader’s feelings or careers or narcissistic needs.​

  • Processes and Programs are in place to effectively measure and manage change and outcomes​

​Has formal “Cultural Development” programs and processes to develop informal leaders and the culture as part of Leadership Effectiveness.

 Operational Clarity Outcomes include:

  • Organic Revenue Growth of >20% Year-over-Year becomes a “built-in” capability of the business​

  • Significant New Clients result from referrals, not just direct sales, channel or partnerships ​

  • Significant Client Retention & Recurring Revenue capability is part of the core competency of the company​

  • Employee recruiting is dominated by employee referrals, not “outbound” overt recruiting activities​

  • Effective Internal ”Informal” Leadership Programs

Tactical Clarity

Tactical Clarity includes:

  •  Sales Plan by Geography, Product, Lead Source, Sales Source or Service​

  • Cost of New Customer Acquisition is Sector “Best of Breed” ​

  • Structured Potential Client Maturation Processes (Proposals, SOW, RFP's, Competitive Intelligence, etc.)​

  • Customer Retention and Customer Lifecycle Plan, including Product Maturation​

  • Client Internal Management Documentation & Measurement and Metrics ​

  • Client External Documentation Programs, very effective client review processes (QBR)​

  • Customer and Employees are “Tied” with technology/IT and analytics, to the company​

  • Measurement and Metrics are prevalent at the department, function, team and individual levels​

  • Individual Contributors’ compensation is dependent upon their success, the team and the company​

  • Compensation reward is realized close in time to the activity completed​

  • The “Employee Lifecycle” is managed and measured​

  • Low to Zero Turnover in the supervisory and executive levels​

  • Structured and Measured Workforce Management Programs are a priority of supervisory and executive leadership​

    • Training curriculums​

    • Certification programs​

  • Process and Improvement Committees are a formal function and part of the culture of the organization​

  • Technology Enablement Plans and Roadmaps to create customer dependency and scalability of business processes are always in the Top 5 Business priorities and investments

Tactical Clarity Outcomes include:

  • A “Franchise Effect” is developed. A definable and a predictable company is prevalent. The Business Process and Perform Culture is more important than any single contributor  ​

  • If an “event” or “activity” of transactional nature occurs, it is treated as a process failure, and/or a leadership failure ​

  • Process and technology become people enablers, and therefore an investment ​

  • A “perform & knowledge-based culture” is established and rewarded versus a “serve executive management mentality”. There are no “nannies” in the services business world! ​

  • High employee retention and lower recruiting costs are reflected in financial performance through operating leverage and increases in productivity, that are “best in sector class”​

  • The Business Process becomes more important than any one person, investment, or any one executive

Financial Clarity

Financial Clarity includes:

  •  A 3- to 4-year Financial Plan/Wealth Creation Plan that reflects the market/sector opportunity, the measurement and metric capability and performance of the company.  This is not just a mathematical exercise: i.e. 20% YOY growth​

  • The Measurement and Metric System should be the “forecasting tool” for financial performance​

  • Financial Reporting and Forecasting Systems that are highly automated, accurate, timely, and enable the business to accurately budget and forecast itself ​

  • Current and subsequent year detailed annual Budgets are based on the company's key measure and metric performance, not math! ​

  • Budget Performance to Actual Performance reviews: Quarterly at a minimum: Governance commands adherence and when performance gaps occur, assertive executive/governance action is taken​

  • Measurement and Metric detailed analysis and review at the function level is prevalent: Quarterly at a minimum. Deficiency action plans and corrective actions plans to be monitored and reported on by management.​

  • Formalized and Adhered to Accounting Policies and Procedures​

    • 13 & 26 Week Cash Forecasting that is accurate. ​

    • Accruals are part of an automated systems process​

    • Expense Reporting​

    • Billing ​

    • Accounts Receivables​

    • Accounts Payable​

    • Payment Authorizations ​

    • Spending Commitments​

    • Disbursement Controls​

    • Business Controls ​

    • CAPEX Approval Process​

  • Financial Executive has an “external” confidant who serves as a resource: i.e. a BOD member, Executive Chairman, Audit Firm, or trusted advisor/"Board of One".  ​

  • Internal and External Risk Management reviews annually​

  • External Accounting and Financial Review or Audit Annually​

Financial Clarity Outcomes include:

  •  The amount of Wealth that can be created by the “franchise” and market opportunity is identified​

  • Definable, predictable and repeatable financial outcomes are known. If management cannot provide this, new executive management/leadership should be pursued​

  • Pragmatic relationships with all stakeholders are established, not based on “Biased Feelings”​

  • Execution and Investment Risk are understood and minimized ​

  • Exit Optionality Alternatives are ongoing, known, and evaluated by governance or outsiders