Wednesday, September 24, 2014

Strategy vs. Execution

Execution without strategy is purposeless. Strategy without execution is useless.

A business strategy is a cohesive entity of programs, projects, and policies that concentrate and fuse corporate resources to enable an organization to establish, sustain and enhance its competitiveness and capabilities for self-renewal. It's about creating tomorrow's organization out of today.

Strategy and Execution have to go hand in hand. Both are critical. Execution without strategy is simply jumping from one thing to the next. It is a truly great thing to be a part of the team when strategy and executing get in sync and so there is clear decisive action take towards a clear strategic direction. That is when organizations really take off. A well-crafted, unexecuted plan is just a wish. A competitive advantage is only established when a well-crafted plan is executed. In fact, the following four stages are necessary to achieve the desired change. ANALYZE (competitive landscape, trends, insights, etc.) -> PLAN (the destination or goal and roadmap) -> EXECUTE --> MONITOR and ADAPT = Repeat as needed. 

The strategy is the destination. Execution is the drive. If you don't know the destination, you just keep driving until you run out of gas in the middle of nowhere. On the other side, a strategy is nothing without execution, but culture trumps both. A strategy should encompass the 3 main pillars to succeed and follow “POLC” principles as well: 
(1) a strategy on how to approach the strategic planning process; 
(2) a strategy on how to develop a strategic plan; 
(3) a strategy for strategy execution. 

"POLC" principles:
[1] P = Plan the plan/strategy 
[2] O = Organise the plan/strategy 
[3] L = Lead the plan/strategy 
[4] C = Control the plan/strategy 

A finger without a hand is akin to a strategy without execution. A Strategy is a planned direction to act - without implementation, it is not complete and is probably someone's idea that got lost in the mail. 'Culture' describes the state of growth of the journey on the way to civilization. In itself simply a description of a process rather than the plane of civilization one has reached. Strategic Planning and Execution are a continuous cycle of organizational adaptation to a changing world.  Strategies fail either because of improper execution or more likely because the strategy was flawed. It implies 3 potential points of failure: 
(1). Poor organizational capability in assessing the business environment and setting/re-setting of strategic direction. 
(2). Poor organizational capability in the management of projects and multi-project programs that translate strategic direction into real changes within the organization. 
(3). Poor organizational capability in the governance of projects and programs that is needed to maintain strategic fit - stop individual projects if a change in direction makes them no longer necessary. 

THREE levels of strategy and each must be integrated to have a complete strategy. The level I: INVESTMENT strategy, which decides on where and when an organization must invest its scarce financial, human and physical resources. The level II is DIFFERENTIATION strategies that specify how the organization can gain and maintain a sustainable competitive advantage. The level III is an IMPLEMENTATION strategy that determines how each part of the organization, including all of the key functions must "put it all together" to be successful.  "A second class strategy well-executed trumps the first-class strategy badly executed.

Strategy and execution should not be thought of as separate or competing things, rather complements of each other. If strategy versus execution is the implication that managing a corporation starts with a strategy and ends with the execution of that strategy. In fact, the process flows like this: 
(1). It starts with knowing shareholder objectives (what they value, how they want their benefit and its quantum, what do they want to see grow, and how do they define risk);
(2). Adaptation of those objectives into corporate objectives (the corporation's mission);
(3). Molding a strategy to deliver those corporate objectives;
(4). Molding an execution/delivery strategy. 

Conclusion. As long that people approach strategy and execution as two sets of activities, they will continue to fail in achieving the expected benefit.


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