New CEOs or general managers always inherit an organization that is headed in a particular direction. It has strengths and weaknesses, and it faces threats and opportunities. The existing condition of the company as determined by the four laws is the point of departure.
Diagnosing the point of departure is the new manager's first and most urgent task: it should set his or her agenda for the first 100 days or so. This is the first place the laws prove their worth. In effect, they define what the new manager needs to know in this process.
To determine your point of departure, you need to know exactly what has been going on, where your organization stands in the marketplace, what its internal capabilities are, what threats and opportunities it faces. That's your starting point. Someone once said that if you don't know where you're starting from, you'll never get where you're going. The maxim applies doubly to running a business or indeed any sort of team.
In The Breakthrough Imperative, we walk you through the process of making a thorough, detailed, analytical, fact-based assessment of your point of departure, using the lens of the four laws. This is what we are calling the full-potential performance-improvement diagnostic process, or just the performance-improvement diagnostic. The role of the diagnostic is to help you understand what the full-potential performance of your business can be. It will help you see exactly where you can improve and where you should set your priorities.
Implications for the general manager:
- Carry out a rigorous full-potential performance improvement analysis of your business position using all the diagnostic tools of the twelve must-have facts. This diagnosis will examine both internal and external facts, and will require a sharp competitive focus. Try to complete the assessment of your point of departure in the first ninety to 120 days.
- Distill from the detailed analyses of the full-potential improvement diagnosis the few critical areas that will provide the most potential improvement (cost? customers and segmentation? complexity? capabilities? and so on), and prioritize those areas based on impact and ease/risk of execution.
- Build consensus with all stakeholders on the true point of departure. Spell out the few critical action imperatives, the required urgency of change, and the likely resource commitments necessary to build and leverage your capabilities.