If there is one thing missing from so many otherwise great organizations I’ve worked with, it is strategy execution. Many managers understand that a strategy is essential for success over the long-run, but surprisingly few are capable of mapping that to operational terms meaningful to the rest of the organization.
Robert Kaplan (co-creator of the Balanced Scorecard) suggests that according to a recent Bain Consulting study, seven out of eight companies (in a sample of almost 2,000 large corporations) fail to achieve profitable growth, even though more than 90 percent had detailed strategic plans. (Link)
Why is that? It is assumed that failure is assured without a strategy, but with a well crafted, informed strategy success is destined. In fact, we see that the mere existence of a strategy means very little in terms of contribution to success.
Using a sports analogy, teams heading into game day will have prepared a strategy that has been chosen as the best means to victory given the conditions, the opposition, their active roster and even the reputation of the fans. But what good is a strategy without the playbook? The result is a team that understands the elements required to win, but without the direction to apply their efforts cohesively.
Strategy execution is all about the “operationalization” of strategy, but this is not straightforward and takes as much introspection as it does external analysis. I intend to further explore this “gap” between strategy and tactical operations in subsequent articles, but would like to focus here on the Strategy Execution as an organizational trait.
A few years ago I attended a discussion led by Dr. Kaplan where he suggested that there are five key principles that management should assess when developing a Strategy Execution Plan. I’ve modified them somewhat to my own taste and experience, but the themes remain consistent:
- Deliver Exceptional Leadership. Corporate change in a leadership void is a recipe for disaster. Leaders must be visible and available when attempting to align the organization to a new (or even existing) strategy. The concept of a “leadership coalition” is cited as a key contributor to successfully implementing a strategy execution plan, and more importantly a culture of execution.
- Communicate the Mapping. The mapping of strategy to operational terms needs to pervasive and communicated consistently and constantly. In Kaplan’s words: “Say it seven times, in seven different ways”, which is to say that the delivery of the message needs to become as much a part of the fabric of corporate culture as your core values and mission are.
- Demonstrate Organizational Alignment. A common question is, “What happens if the result of my Strategy Map is the realization that one or more of my initiatives are off-strategy?”. The answer (as any good consultant will always tell you) is that it depends. However, the “answer” depends less on the tangible elements of the problem, and more on the resolve of leadership to stay on-strategy and to assure organizational alignment. Make alignment to strategy another cultural trait of your organization.
- Provide the Inspiration. Kaplan suggests providing the right “motivation” for your team. I prefer to explore inspiration than motivation. Motivation urges action often through the enticement of reward (or threat of correction), whereas inspiration draws from deeper purpose that provokes greater engagement for a longer period. For example, the inspiration one feels when efforts are appreciated and their individual efforts are aligned to the success of the whole.
- Strategy as a Continuous Process. We have all experienced ‘strategy’ being that tired document that was produced years ago, printed, and distributed to staff. Instead the concept of continuous strategy development needs to be embraced. Much like the analogy of a sports team with a game plan: it is naive to use the same game plan with every situation or opponent. The team must have the ability to adapt to changing environments, different competitors, etc.
In my experience three critical themes contribute the greatest to developing an environment conducive to strategy execution.
- Make it Cultural. What better way to make a strategy execution plan succeed than to make strategy execution a central theme within the culture of your organization. The team in procurement needs to insist that they understand how their efforts contribute to the strategic success of the organization. If it isn’t clear, demand clarity.
- Make it Personal. Too many reports, plans and “strategies” are written by, for and to the general amusement of consultants and senior executives. A litmus test: Does your junior accountant in accounts receivable identify with your vision and your organizational strategy? Can she articulate how that strategy applies to what she is doing right now? Why not?
- Make it Practical. Does understanding the correlation of my every-day tasks to overall organizational success need to be complex? If it is, maybe it isn’t correlated. Re-thing the strategy map.
What do you think? What are your experiences?