Translating strategy into execution
What causes well-crafted strategies to fail?
During his thirty years in organizational development and training, Harold S. Resnick has earned international recognition as a leading authority and innovator in organizational transformation and leadership development. He has consulted with hundreds of private and public sector companies in North and South America, Europe and the Middle East.
In this commentary he sets out guideposts for translating strategy into execution.
Most organizations create strategies to achieve their business objectives. Strategies may be established for the development of new products or services; for new approaches to marketing and sales; for creating value- extensions to existing products; for internal productivity gains; for talent development; and other initiatives designed to increase organizational performance and create new opportunities.
Most senior management teams work together to develop these strategies. Yet the evidence of the successful execution of new strategies is remarkably poor. Many well-conceived strategies remain languishing in a corner, with minimal if any implementation. Others are implemented but fall far short of their promise and expectations.
Why is this so? What causes well-crafted strategies to fail in execution, and what are the core elements that must be included for strategies to be executed well?
Causes of ineffective execution
One of the most fundamental barriers to the successful execution of a new strategy is the organization´s success in implementing its transactional business model. Organizations are designed to do what they do every day. Each functional area has defined responsibilities and develops the work processes and people to fulfill those responsibilities. Most organizations are very good at implementing their day-to-day work.
"Many well-conceived strategies remain languishing in a corner, with minimal if any implementation."
But new strategies often challenge the day-to-day transactional work that consumes the bulk of the organization´s resources. New strategies typically:
- Are cross-functional and require the coordinated efforts of a number of areas with the organization
- Challenge existing work processes and assignments and require new behaviors or actions
- Need the time and energy of people who are busily engaged in implementing their day-to-day work
- Have not yet proven to be successful and are subject to resistance because they challenge the status quo
- Are often inadequately resourced – in terms of both budget and people
The above are the main reasons why most strategies succeed in concept but fail in execution.
Structuring new strategies for success
To overcome these barriers the organization must create an environment that supports the implementation of the strategy – especially in its early stages. The following are the key elements essential for successful implementation.
- The senior leadership team must understand and endorse the strategy – including the resource requirements and the implementation plan. Every member of the senior team whose work or resources may be impacted must be included.
- A strategy leader should then be assigned either from the senior management team or reporting to the senior team with full responsibility and accountability for implementation. The strategy leader remains accountabile until either the strategy has been accomplished or has become embedded in the organization.
- The strategy leader must lead a cross-functional implementation team, represented by all involved areas.
- The implementation project plan must be created by the team and endorsed by senior leadership. The plan should include major tasks, schedule, budget and human capital requirements, and key milestones with accountability back to senior leadership.
Many strategies fail because of employee resistance, ranging from overt refusal to malicious compliance. In order for a new strategy to be implemented successfully, employee trust and commitment must be earned through the following three components.
- Education and explanation. Employees need to be told what the new strategy will be and why it is important. They need to understand their role and the impact of the new strategy on customers and on the organization.
- Involvement. Employees who will be affected need to have an opportunity for involvement, especially in the design and implementation of the execution plan. Figuring out the best way to implement the strategy and gain the maximum benefit typically generates commitment. Even in circumstances where employees may not be direct beneficiaries – even when they learn that their own jobs may be outsourced – they can be engaged and supportive if they understand the reasons, are involved in the process, and see that they are being treated fairly and with consideration.
- Clarity of responsibility. Clear expectations with defined responsibilities and accountabilities are an essential part of execution. Employees need to know what they will be held accountable for and believe that they are receiving the resources – time, training, tools, etc., to be successful in fulfilling these new responsibilities.
Organizations that pay attention to both the structural and human aspects of strategy execution reap the benefits of successful implementation.