It is a sad fact that most strategies fail to get fully executed despite the recognition and attention paid to change management in facilitating the transition from good ideas into action.
“Our problem is not about the strategy itself, but our execution of it.” Tony Hayward CEO BP (10/2007-BP sets out its Agenda to Close Performance Gap with Rivals)
“The change will not be in our fundamental strategy – we think that strategy is sound – but in our execution.” Benjamin Rosen, Chairman Compaq, 1999.
A McKinsey study in 2007 “How to improve strategic planning” identified five ideas to improve the strategic-planning process, which comprised:
- Start with the issues, anticipate the big challenges and emergent trends rather than a focus on data driven processes such as budgets and financial forecasts
- Bring together the right people, that is those who are the most knowledgeable and influential, able to stimulate and challenge accepted thinking with honest open discussions about difficult issues
- Adapt planning cycles to the needs of each business, get away from a time consuming annual process to a planning cycle that fits the needs of the business which may be only every two to three years.
- Implement a strategic-performance management system, that assigns accountability for initiatives and make their progress more transparent.
- Integrate human-resources systems into the strategic plan, by tying the evaluation and compensation of managers to the progress of new initiatives.
The development of an organisation’s strategy is often a tense, intense and exciting process, an opportunity to vent frustrations, put cards on the table and tell it how it is. Rationally, a strategic review may be undertaken because of competitive and financial pressures and the whole panoply of business guru strategic models can be deployed along with the input from market research, workshops and facilitation from consultants and subject matter experts. Awaydays, metaphors of burning platforms, project codewords and the utmost secrecy all add to the buzz and excitement. The CEO and Board may set out the aspiration to become an agile learning organization, capable of adapting to changing circumstances and customer demands. Seemingly, the hard and exhausting intellectual work has now been completed, but the difficult practical work in executing the strategy and realizing its benefits must now begin as the strategy is unveiled for conversion into plans, KPIs and communication programmes.
Bridging the air gap between strategic plans and execution requires practicable frameworks and toolsets to minimise the risk of strategic failure. Such a framework has recently been described in Kaplan and Nortons’ recent book, “The Execution Premium – linking strategy to operations for competitive advantage”. However, although the framework describes the work that is required to implement the strategy, it does not provide a comprehensive management toolset to support it. No doubt, different tools and approaches can be utilised for different stages of the framework. One of the few toolsets that is available is KeyneLinkTM a strategy-driven execution management system that integrates an organisation’s strategy, vision and values with the daily activities of its people. KeyneLinkTMprovides a systemic approach tomanaging an organisation in a way that the McKinsey study identified in the need for a strategic performance management system and that is capable of integrating the HR systems into the strategic plan. KeyneLinkTM is an approach supported by a web-based system that links an individual’s goals and objectives to the strategy. Progress in the execution of the strategy is managed on a regular basis. The whole point about KeyneLinkTM is to facilitate regular communication between managers and their subordinates with a focus on explicitly cascading strategic alignment down through an organisation. This systemic approach beats leaving strategy execution to the vagaries of differing corporate cultures and management styles that bedevil large and even small organisations. Shouting a strategy from the rooftops doesn’t make it happen!
Jeff Herman
Blue-Plate Consulting on the Web 
I like this piece.
The quotes from Compaq and BP are a good reminder of the frequent gap between strategy and execution. Is successful execution about co-ordinating a complex collection of actions, processes and projects?
Do some CEOs find it easier to blame poor execution when the strategy itself is wrong.
Mike – execution is complex because of the reasons you stated and the capabilities needed to manage this complexity over time within large organisations that are constantly in a state of flux due to the changing operating environment as well as the changes in personnel.
Another tool to consider is the Implementation Compass.
Every organization is unique and every implementation is different. We discovered, however, in our ten years of research, eight areas of excellence in execution, where all the organizations who successfully implemented their strategy, focused. In Bridges these eight areas evolved into our proprietary tool, the Implementation Compass (TM). Excellence in execution is not about doing one or two things well, such as changing measures or communicating the strategy. It is about doing eight things well, simultaneously.
The Implementation Compass is a framework that provides you with the structure for your strategy to make it come alive. Instead of wandering aimlessly through the implementation maze it allows you to assess your implementation readiness and identify the key areas to tackle.
Excellence in execution is not about doing one or two things well, such as changing measures or communicating the strategy. It is about doing eight things well, simultaneously.
Robin
Thanks Robin – further validation that “Execution” is the next big thing and another useful framework.
Jeff
I agree that execution is often where it all falls apart. I observe a tendency to then blame the strategy (the reverse of Mike’s observation :-)) leading to a continuous cycle of redoing the strategy and making little progress, when really the failure is one of implementation. Of course no strategy is perfect or timeless. With good execution you can revisit and revise the strategy in the light of valid experience and having made some progress.