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Guest: Mateo Romano, a coach at CEO Coaching International. Matteo has more than 25 years of experience at top brands including Mattel and Tyco Toys. He is an exceptional driver of business growth, revenues, and profitability at companies across the U.S., Europe, and Latin America.
Quick Background: Every new remote worker you hire, every smaller company you acquire, and every international office you open thinks the same thing: “We’re different. We have a unique way of doing things, and it works.”
Maybe. But when it comes to setting targets and measuring progress, a growing company needs to establish a baseline of consistency to ensure that every level of the organization is working towards the same goals.
On today’s show, Mateo Romano explains the four elements of alignment that will keep a BIG decentralized team progressing towards your BIG vision.
Keys to Organizational Alignment from Mateo Romano
1. Focus on commonalities.
As he managed growing companies in several international markets, Mateo regularly bumped heads with “different” teams who resisted new objectives and best practices.
“At the beginning, I used to fight about that,” Mateo says. “And then I understood that what we need to do is to focus on the commonalities and try to build from the commonalities. What can we do with what has already been developed, and how can we get the maximum outcome?”
Alignment on what’s working can save you time, money, and manpower. For example: during his time in the toy business, Mateo learned that if you give a well-designed toy to a child from any country in the world, that child will know how to play with it immediately. And if your products aren’t well designed, investments in more SKUs or rebranding aren’t going to make any difference.
But it can be just as important to have alignment on things that aren’t working. To prevent a crisis and inspire change, a more emotional appeal may be necessary.
“We had to implement a program to convince people why change was good,” Mateo remembers. “So we used a book called Our Iceberg Is Melting. We shared the book with the whole company and took them through the story. And then we told them, ‘Guys, we are in a situation that our iceberg is melting.’ So it was trying to connect everyone to our reality, because sometimes everybody’s very comfortable just doing the same thing that they have done for many years. And they don’t see that it’s time to evolve.”
2. Target one number.
“The next thing that I found is that everyone was coming to meetings with a different number,” Mateo says. “Finance had extrapolated growth opportunities and set up their number. Sales was using their projections in order to get their commissions. Marketing was based on how much money do I need to generate to be able to support my marketing plans. Supply chain was measured by inventory. In theory, everyone was going in the same direction, but everybody had a different set of numbers.”
Which, in practice, means that mangers and their teams weren’t progressing towards their most important targets: the ones set by the CEO and the leadership team.
This lack of alignment often shows that the company’s communication rhythm has broken down. At high-performing companies, daily huddles build to weekly leadership meetings, which build to monthly reviews, which build to quarterly and annual planning sessions. If your meetings aren’t reinforcing each other, it might be necessary to clear the deck and set a new drumbeat.
“We implemented a consensus meeting that had the purpose of aligning to one number,” Mateo says. “So everybody had to say, If we are going to achieve this, how are we going to be able to get it? And that forced the conversation between sales, marketing, supply chain, and finance to be on the same table and align on what we can really achieve. And having that one number, it was easier to be able to allocate responsibilities and to follow up on what we need to do.”
3. Manage accounts, not sales.
As Mateo mentioned, the activity of your sales team can be a lot like a river: it’s going to roll downstream following the path of least resistance. If your comp package isn’t incentivizing sales of your most profitable items or new business, your team will keep pulling small fish out of the same pond and cashing their checks.
In addition to aligning monthly sales goals to your BIG annual goals, Mateo also recommends rethinking the relationship between your salespeople, your customers, and your KPIs. “We moved from sales quotas to account management,” he explains. “Don’t focus only on the lagging indicator, the sales. Let’s focus on the leading indicators. What do we need to do in order to be able to generate sales? Do we need to do promotions? Do we need to have a catalogue? Do we need to be in end caps? Forcing the salesperson to work at that level of granularity on their plan really gave them the opportunity to have a very robust plan to present to the customers, and then have an intelligent conversation. Not just, ‘This is the quantity that you should be buying,’ but ‘You can buy this quantity because we are going to do all these activities in order to generate sell through.'”
4. Establish milestones.
Reestablishing your meeting rhythm isn’t just good for team alignment. It’s good for refocusing on your annual plan, establishing short-term milestones, and assigning accountability.
“Align on the milestones,” Mateo says. “What will be the key dates on which we will get together? And what are we going to do in these meetings? Weekly, we will be following up if we are delivering on the number for the month. Monthly, we need to see what type of tactical decisions we need to take in order to be able to deliver the number. The annual number is divided into quarters. So every quarter, that’s when we evaluate how we are doing versus our strategy. And then the annual planning is the strategy that we are going to follow during the year. Following this, and having everyone involved in the process, really helped us to get alignment. Everybody was talking the same language and everybody understood that whatever they do will impact other areas.”
When your people, your best practices, and your targets are all in alignment, there’s a palpable sense of purpose that unites every level of the business. Maintain that rhythm of planning, execution, and review, and your alignment can become a self-perpetuating force for Making BIG Happen.
“These four elements are the flywheel to get many, many efficiencies,” Mateo says. “Once everybody’s following the same process, you can just plug and play one country to another, one region to another. And by doing that, you can develop strategies that will be more efficient.”
Top Takeaways
1. Business is business and customers are customers. Test what’s already working in new markets before making unnecessary investments in new SKUs or services. People around the world are more alike than different.
2. Drive toward KPI clarity. Your business can become unmanageable if you have too many KPIs floating around. Zero in on the most important metrics and manage to those companywide.
3. Maintain your meeting rhythm. By regularly reviewing your plan and course correcting as needed, you’ll maintain companywide alignment and consistently be marching towards BIG growth.
About CEO Coaching International
CEO Coaching International works with CEOs and their leadership teams to achieve extraordinary results quarter after quarter, year after year. Known globally for its success in coaching growth-focused entrepreneurs to meaningful exits, CEO Coaching International has coached more than 1,000 CEOs and entrepreneurs in more than 60 countries and 45 industries. The coaches at CEO Coaching International are former CEOs, presidents, or executives who have made BIG happen. The firm’s coaches have led double-digit sales and profit growth in businesses ranging in size from startups to over $10 billion, and many are founders that have led their companies through successful eight, nine, and ten-figure exits. Companies working with CEO Coaching International for two years or more have experienced an average revenue CAGR of 31% (2.6X the U.S. average) and an average EBITDA CAGR of 52.3% (more than 5X the U.S. average).
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