Operational Art Defined

The Operational Art Defined

People are often confused by the term The Operational Art.  This is largely due to the fact that it is formally taught and practiced in very few places: some elite Military academies, the U.S. Military and a few other locations globally.  The Operational Art Methodology is one of Core Benefits we deliver to our Clients and – to our knowledge – we are one of a handful of firms that even broach this topic utilizing the Andover Partners Methodology.In its simplest form, the Operational Art is defined as the actions required to ensure that your Strategic Plan is100% aligned (“linked”) to the day to day requirements (“Tactical necessities”) of your business Operations and vice versa.

A simple example of The Operational Art in sports

The photo above of an Olympic rider and horse’s flawless execution of a course water jump is a simple, yet perfect example of The Operational Art.

In this example –using this specific jump as an isolated event – the Strategic Plan is to successfully negotiate the jump.

The tactical necessities are numerous and include everything from the exact distance from the obstacle that the horse starts to jump (too soon and the horse lands in the water: too late and the horse hits the white fence) to the physical position of the rider in the saddle to avoid being thrown off.

If the rider’s judgement and plan at making this type of jump (the Strategic Plan) is not 100% aligned (“linked”) to the horse’s personality and health that day (the “Tactical necessities”), the horse may fail to jump, or not make the jump properly.

Contrariwise, if the horse’s experience with this specific type of jump (the “Tactical necessities”) is not 100% aligned (“linked”) to the rider’s understanding of the jump and comfort riding the horse, the horse may throw the rider, or even get injured.

A simple example of the successful implementation and execution of The Operational Art in the Hospitality business

In the business world, a fine example of properly implemented and executed Operational Art isCourtyard by Marriott.

In brief, the Strategic Plan for Marriott (now branded Marriott Bonvoy) was to develop a hotel chain that offered a consistent guest experience, specifically for the business traveler, in easy access business centric locations globally and at an affordable price.

Once again, in brief, the day to day requirements of the business Operations (the Tactical necessities) meant that each Courtyard had to be designed in a similar fashion to ensure guest familiarity (the hotels are all designed around some type of courtyard – thus the name), there is the type of Benefits that business guests require (fast internet, access to a gym, coffee service in the morning, etc.), the hotels are located near other business centers and the pricing is consistent globally and overall they are a very good value (three star rating) for cost conscious businesses.  One critical item of note: the beds and bedding are the same as the high end full service Marriott hotels.  So, you are not being “punished” for not staying in a more expensive Marriott in terms of sleep!

As such, the Strategic Plan is linked to the day to day requirements of the business Operations and vice versa.

Critically, over the years, the Courtyards have made upgrades and adjustments to the physical plant and Benefits to mutate with changing guest requirements.  This is a critical part of The Operational Art in that it is flexible, resilient and adaptable in real-time.

Example: a lot of the newer Courtyards now have “meeting pods” in their reception areas for guests to meet with Clients & Prospects in a semi-private setting, which saves time and effort on the part of the guest.

Below are two examples of multinational companies that recently experienced catastrophic failures due to breakdowns in the operational art.

1. An example of strategic disconnects and subsequent breakdown of The Operational Art in the international travel business

When your company, or organization is unable to successfully align (“link”) your Strategic Plan to the day to day requirements (“Tactical necessities”) of your Business Operations, there will be problems, some of which can be very serious depending on the business situation.  At the high end of the spectrum of what we call Core Operational Art disconnects, business failure is a potential Outcome and this situation happens more often than you might imagine.

The recent “compulsory liquidation with immediate effect” of Thomas Cook is a sorrowful and yet good example.  Although there appear to be more than one Core Operational Art disconnect, the one that stands out was the incapacity of the company’s leadership to come to terms with the single most important change in the Value Proposition of the firm: namely, that the Benefits of having somebody else make one’s travel arrangements changed enormously over time with the growth of the Internet.

More specifically, the complexity of making reservations for flights, hotels and car rentals, whilst ensuring that one was receiving a fair price AND not making a “quality choice error” (for example, booking a poor quality hotel due to a lack of market knowledge) went away over time as the DIY travel sites become more and more sophisticated.  This is specifically true for hotel reservations with the advent of TripAdvisor and other similar Client rating systems (as an aside, the GM of a top tier hotel in Frankfurt, Germany that I know lives in fear of poor Trip Advisor ratings!).  As such, Thomas Cooks 555 “High Street” shops became a drag on cash flows as they were used largely by either elderly customers on a budget, or low income people (on an even tighter budget) from the immediate area.

This Dynamic Friction situation weakened the Strategy because it invalidated a Key Concept of the business model (that customers would continue to seek to pay higher fees for the convenience of having somebody else manage their travel arrangements), while at the same time the firm’s 555 “high street” physical stores went from an important Tactical necessity to a financial drag on the firm’s cash flows, which in turn negatively impacted the firm’s ability to weather the naturally occurring travel business cycles.

2. A simple example of strategic disconnects and subsequent breakdown of the Operational Art in aProfessional Services business (a Law firm)

There was a global law firm based in the U.K. that had a very large portion of its revenues (70%) from Fortune 100 firms, Oil companies andGovernment & Defense Contractors. As a result, the firm’s Strategic Plan called for focusing on its core practice strengths, which were (1) large multinationals, (2) energy firms and (3) defense manufacturers.  On the surface, this plan made sense as it played into the firm’s natural client base.

However, the Business Development plans for those three main practice groups were not aligned (“linked”) to the day to day requirements (“Tactical necessities”) of growing new law practice business within those three practice areas.

There were three main Operational Art disconnects that ran thru all three practice groups.

First, the technical legal work for Clients was typically being performed  by junior and senior Associates who were physically interacting with the Client on a daily basis.  These junior teams would turn their work over to the Partners who would then meet with the senior leadership of a particular Client on a monthly basis.  This practice negatively impacted the Partners’ relationship various Clients’ senior leadership. The Clients   perceived they were victims of a “bait and switch” situation because they were paying for the seniority, judgement and skill sets of the Partners – not the Associates.

Second, due to the first Operational Art disconnect outlined above, the management of the individual Client relationshipsfell into disarray because the Partners selling the new business to the Client’s senior leadership did not “own” the key individual Client relationships at the Operational level where the “rubber meets the road.”  This was due partly to the fact that the Partners did not physically work on site with the Client on a daily basis (as did the Associates) and partly because the Partners “assumed” that their “positions” would entitle them to control personal relationships from afar.

Thirdly, Pricing.  In some cases, the law firm used hourly rates (typical for Government & Defense Contractors), in some cases “Outcome” (flat fee) based pricing (common when working Oil companies) and in some cases, both (Fortune 100 firms).  The end result was confused and upset Clients who did not know how  to measure the Value and Benefits delivered in context of the high fees they were paying.   This resulted in inconsistent profitability for the law firm (due to a total lack of consistency in billing and pricing, a failure to understand that relationships matter, and that negative perceptions can destroy your reputation and sink your business.