By M. Dana Baldwin, Senior Consultant
Execution is the key to effective results for Strategic Planning. As Robert S. Kaplan and David P Norton, the authors of The Strategy Focused Organization put it, in the opening paragraph of the first chapter: ‘A study of 275 portfolio managers reported that the ability to execute strategy was more important than the quality of the strategy itself.’ Recognize that this is not blanket permission to have poor strategies, but rather an indictment of the effectiveness of execution by all too many companies.
What are the impediments to effective implementation and execution of strategies for companies? One problem is the lack of buy-in by key personnel in the company. What can cause this lack of buy-in? Starting with the actual planning process, are these people part of the strategic planning team? This can involve either direct or indirect participation. By direct participation, we mean that the particular people are on the planning team, and play a role in developing the course and direction the company is going to pursue. In the case of indirect participation, the people are not on the actual planning team, but are part of the development of the data and ideas on which the planning is based. Indirect participants may participate in developing market segment, competitive evaluations, analyzing technology, supplier market conditions, HR needs, economic projections and reviewing regulations under which the company is working. They may submit, through team members, ideas for new markets, new products, new applications or new investments for the company. Any involvement which includes people outside the actual planning team helps build buy-in and ownership of the process, and will result in more people committed to making the strategic plan successful.
Another problem area can be the lack of follow-through on the part of the senior management team. A senior management that is not truly committed to the strategic plan will not do the simple tasks necessary for the strategic plan to be successful. This usually starts at the very top. The CEO must be completely committed to making the strategic plan successful. Where companies fail to execute the strategic plan, one can usually find a CEO who is not able or willing to give the strategic plan the minimal amount of time it deserves.
A third problem is one of over-commitment. In making commitments to the team, each team member must be realistic about being able to actually perform the steps needed to carry out their parts of the strategies or action plans. When realism hits those who over-commit their available time, what gets hit will be strategic action steps. Strategy execution, at least those parts of it which involve action plans to carry out those necessary activities which do not fall into everyday assignments, falls by the wayside as the urgent drives out the important. It is critical that everyone commits only the time which they can realistically make available to perform the activities required to complete the action plans and to carry out the strategies the team has developed.
In conclusion, companies that seek transforming strategies must have excellent execution. This means that the company must systematically remove all impediments to effective implementation.
The Strategy-focused Organization, by Robert S. Kaplan and David P. Norton. Harvard Business School Press 2001
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M. Dana Baldwin is a Senior Consultant with Center for Simplified Strategic Planning, Inc. He can be reached by email at: firstname.lastname@example.org
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