How Critical Roles Drive Value
October 17, 2022 – Inevitably, whether through inflation, supply chain disruptions, global political turbulence, or some other force beyond our control, change hits—suddenly and without warning. When this happens, insightful CEOs need to pivot towards the must-do work and the must-have roles connected to that work. This practice will enable precision in any business transformation but is especially important during times of forced change. It is imperative that every CEO knows which roles are most critical so that they can ensure the right people stay in the right jobs, say Shefali Salwan and Megan Blouin in a new report from CEO.works. “Do you know the 20 roles in your company that will drive 80 percent of the value?” asked the authors. “This question is challenging for many CEOs to answer in steady market environments, and it can become next to impossible to answer in a turbulent one. This is where Talent to Value comes in.”
Talent to Value is a proprietary process that uses targeted analysis to focus on the fewest, most impactful points of value creation. It allows leaders to clarify the work and roles required to realize that value.
“Unsurprisingly, many of our clients come to CEO.works when facing turbulent times,” said the report. “We are a transformation-enabling company—we work with organizations undergoing all kinds of change and are well-versed in the subject. We help our clients build the capabilities required to survive and thrive through challenging times and beyond.”
Cutting the Fat
Critical roles can drive value—fast. “One client, a North American beverages company, came to us with a problem,” said the study. “They knew what their future sources of value would be, but were facing intense market pressure and did not have the ability to invest in growth without taking cost out. In their words, ‘We need to obtain deep insight into the rationale of cost take-out decisions as well as the strategic ambitions of our business to ensure we cut the fat while protecting and building the muscle.’”
“Instead of completing a vague benchmarking exercise, an even more ambiguous ‘ratio of people to revenue’ analysis, or a by-the-book ‘spans and layers’—which would result in headcount reduction according to the organizational hierarchy—this client came to us for an innovative solution,” said CEO.works.
Together the firm and client anchored around getting precise alignment on the value agenda, which would double EBITDA in three years. This was followed by a structural review of the organization, which uncovered significant redundancies in the supply chain and finance functions. “We leveraged the Talent to Value process to enable the CEO to laser in on the critical roles at the company which would be the most impactful tomorrow, as well as the ones which were redundant and ‘leaking value’ today,” said the report. “In doing so, we helped him create his critical roles list.”
CEO.works said the firm generated $80 million of value for its client in just four weeks. “More importantly, we helped them ensure precision in their cost saving efforts,” said the report. “We also removed redundancies without impacting the critical sources of future value. Eighteen months later, the client EBITDA had grown by 1.5 times, putting them well on track to meet their three-year EBITDA goal.”
A Time to Pivot
Another client, a PE-owned women’s clothing brand, faced external industry pressure due to shifts in the retail industry—significant budget cuts were on the immediate horizon, said the study. The company needed to find a way to pivot towards areas of growth. “The most significant source of growth for this business was E-commerce sales, but our client had a nascent E-commerce channel,” said the report.
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“We partnered with them to complete a rapid Talent to Value mobilization plan in less than one month,” said CEO.works. “This would allow the CEO to define an optimal restructuring plan and pinpoint the work and critical roles required to build E-commerce while their physical retail footprint lessened.”
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The critical roles list, highlighted in those examples, said CEO.works, enabled success for the firm’s clients and serves multiple vital functions:
- It creates a clear picture of future value and allows CEOs to understand what they need to prioritize now vs. later to achieve medium- and long-term goals.
- It enables the mobilization of strategy. Strategies are just words on a page without people in critical roles taking action.
- The critical roles list highlights places where CEOs need to support and monitor.
- And finally, it highlights the roles in which CEOs need superior talent.
“After our work together, our clients are not only able to survive but thrive during transformations of all kinds,” said CEO. works. “Talent to Value enables them to definitively answer the question: Do you know the 20 roles in your company that will drive 80 percent of the value?”
As a coach and advisor to C-suite leaders, Ms. Salwan has decades of experience in HR and is the head of the CEO.works Talent to Value Academy. She has 25 years of experience in cross-cultural and global talent management, leadership development and assessments, and diversity and inclusion. She has coached and advised C-suite leaders in multinational companies across five continents. Ms. Salwan’s conversations with C-suite leaders go beyond traditional HR concerns to cover creating value for the organization as a whole. Her involvement as an investor in various HR technology startups and as a board member for Knolskape, a developer of digital training platforms driven by machine learning, adds a unique dimension to her understanding of leading-edge human capital practices.
Ms. Blouin is an associate partner with CEO.works. As a former Accenture Management Consulting practitioner and team lead, she excels at diving into highly complex projects in fast-paced environments. She has a track record of partnering with client stakeholders to achieve operational excellence and drive the value agenda, as well as a reputation for developing business relationships and innovative data models that drive strategic insights.
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Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media
