Steve Sherretta December 13, 2004 Performance Management: Enhancing Execution Through a Culture of Dialogue Peter is Chief Executive Officer for a medical supply multinational that recently crafted a new strategy to counter competitive threats. The plan stressed the need to cut cycle time, concentrate sales on higher-margin products and develop new markets. Four months after circulating the plan, Peter did a “walkaround” to see how things were going. He was appalled. Everywhere Peter turned people, departments—whole business units—simply didn"t “get it.” First surprise: Engineering. The group had cut product design time 30%, meeting its goal to increase speed-to-market. Good. Then Peter asked how manufacturing would be affected. It turned out the new design would take much more time to make. Total cycle time actually increased. “Our strategic plan message is not really getting through,” Peter thought. Second surprise: Sales. The new strategy called for a shift—emphasize high margin sales rather that pushing product down the pipeline as fast as possible. But just about every salesperson Peter spoke to was making transactional sales to high-volume customers; hardly anyone was buildin

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