What is an X-Matrix?

An X-Matrix is a template used in organisational improvement that concisely visualises the alignment of an organisation’s True North, Aspirations, Strategies, Tactics and Evidence on a single piece of paper, usually A3 size (29.7 x 42.0cm, 11.69 x 16.53 inches).

The main elements can be described as follows:

  • True North – the orientation which informs what should be done. This is more of a direction and vision than a destination or future state. Decisions should take you towards rather than away from your True North.
  • Aspirations – the results we hope to achieve. These are not targets, but should reflect the size of the ambition and the challenge ahead.
  • Strategies – the guiding policies that enable us. This is the approach to meeting the aspirations by creating constraints which will enable decisions on what to do.
  • Tactics – the coherent actions we will take. These represent the hypotheses to be tested and the work to be done to implement the strategies in the form of experiments.
  • Evidence – the outcomes that indicate progress. These are the leading indicators which provide quick and frequent feedback on whether the tactics are having an impact on meeting the aspirations.

The alignment of all these elements is shown through the 4 matrices in the corners of the template, which form an X and thus give the format its name. Each of the cells in the matrices indicate the strength of correlation (e.g. strong, weak, none) between the various pairs of elements, forming a messy coherence of the whole approach.

Completing an X-Matrix is a collaborative process of co-creation and clarification to get everyone literally on the same page about the work that needs to be done to succeed. Used to its full potential, the X-Matrix can become a central piece in Strategy Deployment, helping to guide discussions and decisions about what changes to make, why to make them, and how to assess them.

You can download a copy of my X-Matrix template, along with some related ones. Like most A3 formats, there are many variations available, and you will find that a lot of other X-Matrix versions have an additional Teams section on the right hand side. My experience so far has been that this adds only marginal value, and have therefore chosen not to include it.

If you would like help in using the X-Matrix as part of a Strategy Deployment improvement approach, please contact me to talk.

Lean-Agile Strategy Days: An X-Matrix and Agendashift Fusion

PhotonQ-FusionI’m really excited by a new venture on June 7-8 with Mike Burrows. Its called Lean-Agile Strategy Days, and will be an opportunity for attendees to explore with Mike and myself how we can combine and synthesise the X-Matrix and Agendashift as approaches to Strategy Deployment.

From the event page:

We’ll be looking at strategy – how to engage people in its development, how to develop and test the thinking, and how to build habits of follow-through. You’ll be learning through practice, and at the same time participating in an exciting collaboration. Together, let’s discover how these important topics interact and amplify each other.

I’ve blogged previously about Strategy Deployment and Agendashift with my early thoughts on the relationship between the two. Since then have I become an Agendashift partner and attended Mike’s workshop as a participant. As we have chatted and collaborated a couple of things have become apparent.

  1. There is a huge overlap in our thinking and philosophy around how we approach helping organisations through change.
  2. There is a huge opportunity for more collaboration between people with similar philosophies but different ideas.

After Mike ran another collaborative Flow Days workshop with Patrick Steyaert earlier this year, we realised they had created a good way of taking advantage of both these points, and Lean-Agile Strategy Days was born. We hope that this grows into a series of events where different people collaborate to combine their ideas – co-operating rather than competing.

If you want to learn about Strategy Deployment, with either the X-Matrix, or Agendashift, or if you want to be involved in innovating ways of combining the two, then please join us. Super Early Bird price is just £535 + VAT until May 8th for two days of learning and discovery with myself and Mike.

Book now – we hope to see you there!

Announcing the X-Matrix Jigsaw Puzzle

fitting the pieces together

The X-Matrix Jigsaw Puzzle is what I call the exercise I use in Strategy Deployment workshops to help people experience creating an X-Matrix in a short space of time. It consists of a pre-defined and generic set of “pieces” with which to populate the various sections, deciding which pieces should go where, and how they fit together.

I’ve just created a page to make this available under Creative Commons Attribution-ShareAlike 4.0 International.  If you try it out, please let me know how you get on!

Strategy Deployment and Impact Mapping

I’ve had a couple of conversations in recent weeks in which Impact Mapping came up in relation to Strategy Deployment so here’s a post on my thoughts about how the two fit together.

An Impact Map is a form of mind-map developed by Gojko Adzic, visualising the why, who, how and what of an initiative. More specifically, it shows the goals, actors involved in meeting the goals, desired impact on the actors (in order to meet the goals), and deliverables to make the impacts. The example below is from Gojko’s website.

As you can see, an Impact Map is very simple, reductionist visualisation, from Goals down to Deliverables, and while the mind map format doesn’t entirely constrain this, it tends to be what most examples I have seen look like. It does however work in such as way to start with the core problem (meeting the goal) and allow people to explore and experiment with how to solve that problem via deliverables. This is very much in line with how I define Strategy Deployment.

Lets see how that Impact Map might translate onto an X-Matrix.

The Goal is clearly an Aspiration, so any relevant measures would neatly fit into the X-Matrix’s bottom section. At the other end, the Deliverables are also clearly Tactics, and would neatly fit in the X-Matrix-s top section. I would also argue that the Impacts provide Evidence that we are meeting the Aspirations, and could fit into the X-Matrix’s right-hand section. What is not so clear is Strategy. I think the Actors could provide a hint, however, and I would suggest that an Impact Map is actually a good diagnosis instrument (as per Rumelt) with which to identify Strategy.

Taking the 4 levels on an Impact Map, and transposing them onto an X-Matrix, creates a view which can be slightly less reductionist (although not as simple), and opens up the possibility of seeing how all the different elements might be related to each other collectively. In the X-Matrix below I have added the nodes from the Impact Map above into the respective places, with direct correlations for the Impact Map relationships. This can be seen in the very ordered pattern of dots. New Tactics (Deliverables) and Evidence (Impacts), and possible more Aspirations (Goals), would of course also need to be added for the other Strategies (Actors).

Even though this is a very basic mapping, I hope its not too difficult to see the potential to start exploring what other correlations might exist for the identified Tactics. And what the underlying Strategies really are. I leave that as exercise for you to try – please leave a comment with what ideas you have!

This post is one of a series comparing Strategy Deployment and other approaches.

The Messy Coherence of X-Matrix Correlations

I promised to say more about correlations in my last post on how to TASTE Success with the X-Matrix .

One of the things I like about the X-Matrix is that it allows clarity of alignment, without relying on an overly analytical structure. Rather than consisting of simple hierarchical parent-child relationships, it allows more elaborate many-to-many relationships of varying types. This creates a messy coherence – everything fits together, but without too much neatness or precision.

This works through the shaded matrices in the corners of the X-Matrix – the ones that together form an X and give this A3 its name! Each cell in the matrices represents a correlation between two of the numbered elements. Its important to emphasise that we are representing correlation, and not causation. There may be a contribution of one to the other, but it is unlikely to be exclusive or immediate. Thus implementing Tactics collectively contribute towards applying Strategies and exhibiting Evidence. Similarly applying Strategies and exhibiting Evidence both collectively contribute towards meeting Aspirations. What we are looking for is a messy coherence across all the pieces.

There are a few approaches I have used to describe different types of correlation.

  • Directness – Can a direct correlation be explained, or is the correlation indirect via another factor (i.e. it is oblique). This tends to be easier to be objective about.
  • Strength – Is there a strong correlation between the elements, or is the correlation weak. This tends to be harder to describe because strong and weak are more subjective.
  • Likelihood – Is the correlation probable, possible or plausible. This adds a third option, and therefore another level of complexity, but the language can be useful.

Whatever the language, there is always the option of none. An X-Matrix where everything correlates with everything is usually too convenient and can be a sign of post-hoc justification.

Having decided on an approach, a symbol is used in each cell to visualise the nature of each correlation. I have tried letters and colours, and have recently settled on filled and empty circles, as in the example below. Filled circles represent direct or strong correlations, while empty circles represent indirect or weak correlations. (If using likelihood, a third variant would be needed, such as a circle with a dot in the middle).

Here we can see that there is a direct or strong correlation between “Increase Revenue +10%” (Aspiration 1) and “Global Domination” (Strategy 1). In other words this suggests that Strategy 1 contributes directly or strongly to Aspiration 1. As do all the Strategies, which indicates high coherence. Similarly, Strategy 1 has a direct/strong correlation with Aspiration 2, but Strategy 2 has no correlation, and Strategy 3 only has indirect/weak correlation.

Remember, this is just a hypothesis, and by looking at the patterns of correlations around the X-Matrix we can see and discuss the overall coherence. For example we might question why Strategy 3 only has Tactic 2 with an indirect/weak correlation. Or whether Tactic 2 is the best investment given its relatively poor correlations with both Strategies and Evidence. Or whether Evidence 4 is relevant given its relatively poor correlations with both Tactics and Aspiration.

Its visualising and discussing these correlations that is often where the magic happens, as it exposes differences in understandings and perspectives on what all the pieces mean and how relate to each other. This leads to refinement of X-Matrix, more coherence and stronger alignment.

TASTE Success with an X-Matrix Template

I’ve put together a new X-Matrix A3 template to go with the Backbriefing and Experiment A3s I published last month. Together, these 3 templates work well together as part of a Strategy Deployment process, although I should reiterate again that the templates alone are not sufficient. A culture of collaboration and learning is also necessary as part of Catchball.

 

While creating the template I decided to change some of the language on it – mainly because I think it better reflects the intent of each section. However a side-benefit is that it nicely creates a new acronym, TASTE, as follows:

  • True North – the orientation which informs what should be done. This is more of a direction and vision than a destination or future state. Decisions should take you towards rather than away from your True North.
  • Aspirations – the results we hope to achieve. These are not targets, but should reflect the size of the ambition and the challenge ahead.
  • Strategies – the guiding policies that enable us. This is the approach to meeting the aspirations by creating enabling constraints.
  • Tactics – the coherent actions we will take. These represent the hypotheses to be tested and the work to be done to implement the strategies in the form of experiments.
  • Evidence – the outcomes that indicate progress. These are the leading indicators which provide quick and frequent feedback on whether the tactics are having an impact on meeting the aspirations.

Hence working through these sections collaboratively can lead to being able to TASTE success 🙂

One of the challenges with an X-Matrix template is that there is no right number of items which should populate each section. With that in mind I have gone for what I think is a reasonable upper limit, and I would generally prefer to have fewer items than the template allows.

This version also provides no guidance on how to complete the correlations on the 4 matrices in the corners which create the X (e.g. Strong/Weak, Direct/Indirect, Probable/Possible/Plausible). I will probable come back to that with a future version and/or post.

How Rally Does… Annual and Quarterly Planning

This post was originally published on the Rally Blog and I am reposting here to keep an archived copy. It was part of a series in which we described various aspects of the way the business was run. Apart from one minor edit to help it make sense as a stand alone piece I have left the content as it was. However, I suspect that since Rally is now part of CA Technologies, much of what I described has changed.


Rally has a regular, quarterly cadence with which we manage corporate planning, and in which we invest heavy preparation so that we get maximum value. For this year’s Annual Planning, preparation included creating market and opportunity maps and a set of potential strategies, as well as crafting an agenda to help facilitate the collaborative co-creation of the outcomes.

What is Annual Planning?

At Rally, Annual Planning is a two-day meeting involving around 80 people – roughly 70 Rally employees and 10 invited customer representatives. The employees are a mix of people representing all areas of the business: directors and above always attend these key corporate cadences, and other members of the company take turns participating. The customers chosen to join us are those who have shown a keen interest in seeing how we facilitate these large events, and from whom we can learn and get great feedback. Apart from the confidential opening introduction, the customers are involved throughout: spread out across business groups and breakouts, sitting amongst employees, and actively working and contributing as much as anyone else.

This year, we ran Annual Planning a quarter in advance of the financial year we’re about to start. We’ve learned that the initial plan will need validation and refinement, and thus we need to allow time for that to happen. Therefore, the purpose of the two days was to draft our corporate plan for the next financial year, so that we can validate it in the final quarter of the current financial year.

What Do We Do in Annual Planning?

Over the years, we have settled on terminology for corporate planning, inspired by a couple of books. First, Pascal Dennis’ Getting the Right Things Done introduces the terms “True North” and “Mother Strategies.” The True North is the single mantra or slogan that defines where the company wants to be at the end of the year. Mother Strategies are the focus areas that will help us arrive at the True North.

rocks

The True North and Mother Strategies guide the day-to-day departmental work, along with cross-departmental initiatives, which are knows as “Rocks.” Rocks are inspired by techniques described in Verne Harnish’s book, Mastering the Rockefeller Habits. The metaphor of a Rock is based on the idea that if you have a bucket, you should fill it first with a few big rocks: these are the big things you want to accomplish. If there is more space you can then put in pebbles, or medium-sized projects. With any remaining space you can put in sand, or the tactical tasks. Finally, you can add water — the ad-hoc things that arise. If you fail to put the big rocks in first, you will inevitably fill your bucket with just sand and water.

For Rally, the annual plan, therefore, consists of a True North, a number of Mother Strategies, and a set of Rocks. In addition, this year we introduced a new tool to help create transparency and align all the elements: the X-matrix, as described in Thomas L. Jackson’s Hoshin Kanri for the Lean Enterprise. This brought with it a further level of discipline by including the business results we’re targeting, and the measurable improvements we will use to track progress.

Xmatrixblank

As you can see from the blank template above, completing the X-matrix involves deciding on strategic goals, tactical rocks (and other departmental initiatives), measurable improvements, and business results. These are entered into the large white sections alongside each section. In addition, filling in the shaded corner cells of the X-matrix indicates the correlation or contribution between each of these elements, as well as how accountable each department will be for the tactical work. The strength of the correlation or accountability is indicated with one of three symbols according to the legend: strong correlation or team leader, important correlation or team member, and weak correlation or rotating team member. An empty cell indicates no correlation or no team member.

How Does It Work?

The agenda for the two days of Annual Planning involved exploring and defining all these pieces of the puzzle, ultimately filling in a giant X-matrix created on a wall. The picture below shows this partially completed. Taking the advice from the book, we adapted rather than adopted the technique, changing some of the terminology to better fit our context.

Xmatrixblur

Here’s what each day looked like.

Day one was focused on divergence: generating a range of ideas which could go into the initial draft of the plan. We began with a retrospective on the current year; working individually, in pairs, and then in departments, we reflected on what we’d learned that would guide our work in closing out this year and setting us up for next year. Then, the executive team gave a readout of their perspectives and introduced the proposed potential strategies for next year. This led into an Open Space with breakout sessions focused on exploration of rocks and improvements that could implement those strategies. As a result, by the end of the first day we had a good understanding of the current situation, with a variety of potential work that might be needed to meet our goals.

Day two was focused on convergence: refining all the ideas and getting consensus on a plan that could be validated. Groups initially formed around the proposed strategies to look at the plan through a “strategic lens.” Each group discussed how various rocks and improvements aligned to their strategy, and agreed on a proposal that they wanted to make for inclusion in the plan.

annualplanninggroup

In a high-energy session, the proposals were pitched to three of the executives, who accepted them (with a chime) or rejected them (with a horn). Rejected proposals were updated and re-pitched, until we ended up with the X-matrix containing the top 10 rocks and associated improvement measures, along with the strength of the correlation between all the rocks and strategies. Groups then re-formed around departments to look at the plan through a “departmental lens.” They discussed and filled in the X-matrix with the their department’s level of work alignment to the rocks.

At this point we had the majority of the X-matrix complete for the coming year. This was just a first cut, however, so another Open Space session followed to allow discussion of opportunities and concerns, and what needs to be done in the final quarter of the year to validate our assumptions — resulting in a clear set of actions which were shared with everyone.

By the end of the two days we had a clear and single page visualisation of the potential work for the year, why we were doing it, and how we would measure progress, along with a good understanding of the necessary next steps.

What Happens Next?

As an addition to our corporate planning cadence, the X-matrix was a roaring success. It both helped us be disciplined about thinking about measures and results, and gave us great visibility into how all our work is aligned. It still needs refinement, however, and the executive team will look at the final X-matrix and use it to filter and focus on which strategies and rocks can give us the best leverage in meeting our goals. We typically hold ourselves to no more than four mother strategies and we also strive to limit the number of rocks in process.

From the final plan, we’ll craft a True North statement and will begin executing. The regular cadence of quarterly steering meetings will revisit the X-matrix as a focal point to help us inspect and adapt. We’ll check business results and improvement measures and form rocks, which will start and end according to the necessity of the work and the need to make it transparent across this well-defined review cadence.

The X-Matrix Strategy Deployment Model

There is a model for Strategy Deployment that sits behind the X-Matrix that is worth explaining in more detail as a way of understanding why it is designed the way it is, and how to use it. It is built around describing four types of elements – which I call results, strategies, outcomes and tactics – and how they fit together.

Before we start, lets get the George Box aphorism out of the way:

All models are wrong; some models are useful

Results
Results represent the organisational impact you want to have. They are lagging indicators, success or failure only being declared at the end of the journey. They usually reflect the nature of the business and its economics.

The Results are implemented by Strategies

Strategies
Strategies are constraints which guide how you achieve the results. They are enabling, allowing a range of possible solutions (as opposed to governing, limiting to a specific solution). Thus they guide decisions on where to focus attention (and hence also where not to focus attention).

The Strategies lead to Outcomes

Outcomes
Outcomes provide evidence that the strategies are working. They are leading indicators of whether the results can be achieved ahead of time. They describe the capabilities that the organisation requires in order to be successful.

The right Outcomes will generate the successful Results.

Screen Shot 2016-05-25 at 20.47.46

Of course the Strategies don’t directly lead to Outcomes. Some form of action has to take place. Thus the Strategies are actually implemented by Tactics.

Tactics
Tactics are the activities that take place to implement change. They are experiments which test hypothesis on how to achieve the outcomes. The represent the investments in the improvement work that is being done.

Therefore, it is the Tactics that generate the Outcomes and ultimately lead to the Results.

Screen Shot 2016-05-25 at 20.48.11

For change to be successful, there should be a correlation between the various elements in this model (and it should be remembered that correlation is not causation). Each element will have some level of contribution to another. This will range from strong or direct, to weak or indirect, or there may sometimes be none. You could also say that the correlations are Probable, Possible, or Plausible. All together there should be coherence (albeit messy) to the way all the elements fit together.

Screen Shot 2016-05-25 at 20.48.32

By starting with Results, moving on to Strategies and Outcomes and leaving Tactics until last, there is a greater chance that the Tactics chosen are ones which do implement the Strategies and generate the Outcomes. The intent is to avoid premature convergence or retrospective coherence when identifying the Tactics. It is very easy to hastily jump to the wrong conclusions about what the Tactics should be, and then justify them based on the Strategies.

Even if you don’t use the X-Matrix explicitly, understanding this model can be useful for asking questions about change and improvement.

  • What end results are you hoping to achieve?
  • What are your strategies to deliver them?
  • What intermediate outcomes will show you are on the right path?
  • What tactics are you using to move forward?
  • How do all these pieces fit together?

If you can answer these questions, then you should be able to populate an X-Matrix. I will work through an example in an future post.

X-Matrix Simple

Alignment and Autonomy in Strategy Deployment

Following on from my previous What is Strategy Deployment and Dynamics of Strategy Deployment posts, there is a model I like which I think helps to show how the mechanics and the dynamics work together.

In The Art of Action, Stephen Bungay describes how Field Marshall Helmuth von Moltke, Chief of Staff of the Prussian Army for 30 years from 1857, had an important insight regarding Alignment and Autonomy. Previously these two had been viewed as extremes at the end of a single scale. Having high alignment meant having no autonomy because alignment could only be achieved through defining detailed plans which everyone should follow. Equally, high autonomy meant having no alignment because autonomy would result in everyone doing their own thing with no regard for each others actions.

Von Moltke’s insight was that alignment and autonomy are not a single scale requiring a tradeoff between the two ends, but two different axis which can actually reinforce each other. Thus not only is it possible to have both high alignment and high autonomy, but high alignment can enable high autonomy.

Alignment and Autonomy

They key to making this possible is differentiating between intent and action. Alignment is achieved by clearly stating intent centrally, such that autonomy can be achieved by allowing action to be decentralised in support of the intent. This requires mechanisms to both clarify and amplify intent, and enable and encourage local action. Thus using the definition of Strategy Deployment as “any form of organisational improvement in which solutions emerge from the people closest to the problem”, solving the problem is the intent, and the emerged solution is the action.

Using this model we can now describe two mechanisms necessary to make this happen. Alignment can be achieved with the X-Matrix, which enables the conversations about intent and summarises and visualises the results of those conversations. In other words, the X-Matrix shows how results, strategy, outcomes and tactics align and reinforce each other. Autonomy can be achieved through Catchball (Bungay describes the equivalent as back-briefing), which enables the X-Matrix to be passed around the organisation such that everyone can reflect, give feedback, and improve it, helping focus action on meeting the intent.

X-Matrix and Catchball

Viewing Strategy Deployment in this light also highlights a symmetry with the Autonomy, Mastery and Purpose model of intrinsic motivation described by Dan Pink in his popular book Drive. Autonomy is a direct match in both models and purpose is equivalent to intent. Mastery is then the result of improving capability autonomously with strong alignment to intent.

Drive

What this way of looking at Strategy Deployment shows is that both the X-Matrix and Catchball are necessary components. Just using the X-Matrix with out Catchball will probably result in it being used as just another top-down document to command and control employees. Similarly, just using Catchball without an X-Matrix will probably result in collaboration around local improvements with no overall organisational improvement.

Kanban Deployment with the X-Matrix

This is a continuation of my musings on Strategy Deployment, the X-Matrix and Kanban Thinking (including Strategy Deployment as Organisational Improv and How Do I Know If Agile Is Working). I’ve been thinking more about the overlap between Strategy Deployment and Kanban and come to the conclusion that the intersection of the two is what could be called “Kanban Deployment” [1].

Let me explain…

To begin with, the name Strategy Deployment describes how a centralised decision is made about strategy, which is deployed such that decentralised decisions can be made on defining and executing plans. The people who are engaged at the coal face are the people who are most likely to know what might (or might not) work. In other words its the strategy that is deployed, not a plan.

Similarly, Kanban Deployment can be used to describe how a centralised decision is made about kanban as an approach to change, which is deployed such that decentralised decisions can be made on defining and executing processes. Again, the people who are engaged at the coal face are again the people who are most likely to know what might (or might not) work. Its kanban that is deployed, not a process.

With this perspective, we can look at how the X-Matrix could be used to describe a Kanban Deployment in terms of Kanban Thinking. (For a brief explanation of the X-Matrix see a post on how we used the approach at Rally).

The Results describe the impact we want the kanban system to have, and the positive outcomes we are looking to achieve with regard to Flow, Value and Potential. Just like with ‘regular’ Strategy Deployment, an economic model as recommended by Don Reinertsen is likely to provide clues as to what good results would be, as will a good understanding of fitness for purpose.

For Strategies we can look to the Kanban Thinking interventions of Study, Share, Stabilise. Studying the system is a strategy for learning more about the current context. Sharing knowledge is a strategy for creating a common understanding of the work and the way the work is done. Stabilising the work is a strategy for introducing policies which will enable and catalyse evolutionary change.

The Indicators are equivalent to the Kanban Thinking intervention Sense. These measures of improvement, while proxies, should give quick and regular feedback about whether the kanban system is likely to lead to the results.

Lastly the Tactics are equivalent to the Kanban Thinking intervention Search. These are the specific practices, techniques and policies used as part of the experiment that are run. The Kanban Method core practices can also provide guidance as to what tactics can be used to design the kanban system.

While I’m not sure I would want to be overly rigid about defining the strategies, I find the X-Matrix a useful model for exploring, visualising and communicating the elements of a kanban system and how they correlate to each other. As with all tools like this (i.e. A3s) its not the template or the document that is important, its the conversations and thinking that happen that have the value.

[1] I did consider the name “Kanban Kanri” for the alliteration, but apart from preferring to minimise Japanese terminology, it’s probably meaningless nonsense in Japanese!