Wednesday, August 5, 2015

Strategy Design vs. Strategy Execution: Which one is More Important

The design of strategy is definitely more important. But executing a strategy is more time-consuming and challenging.

The word "strategy" is pretty amorphous with so many individual interpretations and nuances of its meaning that conversations about it often go astray amidst a blizzard of the latest buzzwords. A strategy is a detailed plot to beat the competition, coauthored and in effect owned by a critical mass of thought leaders in a company. More than 70% of strategy execution fail to achieve the expected result. Is it caused by strategy or execution? Strategy design and strategy implementation, which one is more important?

The design of strategy is definitely more important. But executing a strategy is more time-consuming and challenging. There is no point implementing a bad strategy, and bad implementation casts doubt on a good strategy. A lousy strategy remains lousy even when implemented. Hence, the significance of design, which decides whether you can be on a path of mediocrity or greatness. The design is king if this is done incorrectly all other aspects of the project fail. It will cost you big time redo and fix a bad design. Implementation is about the realization of such a concept or plan. It is all about an integrated system approach and every step is essential in reaching a specific outcome, and it is not about what is more important, but rather about the whole thing and the result. Do you have people who are good strategy designers and have also implemented these strategies efficiently? There are very few people who can understand and merge the thought process required in strategy design and strategy implementation. because strategy implementation has quite a lot common with project management basics. In order to bridge the gap between strategy and execution, you need a purposeful and rigorous method for translation of strategy into a realizable architecture before implementation in the sense of projects can begin. How else would you even know that you're working on the right implementation projects in the first place?

A strategy for business change should outline the anticipated benefits - with the benefits being delivered and executed via programs and projects. If the key strategic benefits have not all been delivered, and the strategy has been properly designed with adequate buy-in, then something has gone wrong with the program design and program and project level benefit realization. Something possibly missing is the internal capacity to understand strategy to the extent that the management and executive teams can participate actively in strategy development and proactively drive implementation. They have to drive implementation, otherwise, the emergent business circumstances will continue to “disrupt” business normal, and nobody is adequately prepared to function well in this reactive mode.

Sometimes strategy makers spend more time designing the content of strategies than thinking how to implement them successfully. In other words, lack of accountabilities, lack of decision rights and inter or intra-divisional tensions. The organization's ability to refine, redesign, realign, reprioritize strategies during implementation or execution phase might cause originally poorly designed strategies to succeed or well-defined strategies to fail. More than 70% of Strategy fails in execution. It is about many different matters like resistance to change, silos or units with competing agendas, lack of clear and decisive leadership, leadership actions inconsistent with strategy, poor communication of strategy, lack of accountability on follow-through; inability to measure impact, too focused on short-term results, and maybe the most popular and big obstacle: making it meaningful to frontiers, translating strategy to execution, aligning jobs to Strategy. The most efficient way to make sure both design and execution stay aligned is to integrate the expectations of critical internal stakeholders into the design. If your strategy is designed with these expectations in mind, execution will succeed. Gaps are created when strategies are misaligned with the expectation of the implementation team. This requires an internal branding component of the initial strategy to be attached. Think of internal branding as the digital version of a salesman for your strategy.

Usually, strategy design fails to 'walk in another person's shoes'. Too many strategies that are developed by a small executive group fail when they are 'rolled out' to a bemused and unengaged senior management team. To make implementation work, the wider senior team needs to be involved in the development, have a great understanding and have ownership and commitment. Invite sales and marketing people to "buy in" the strategy by having them contribute their ideas to the strategy. In this context, the market is your implementation team. Don't expect them to just follow orders. In most cases, these are highly intelligent people whose knowledge capital contains the significant value to the design of your strategy and their involvement enhances your ability to close gaps. The whole concept of design of strategy includes the expectations of the line managers as well as anticipation of execution issues. If the momentum is not there to see it through to implementation, then it can't or won't be implemented, and as a result, it is just a piece of paper. If its execution does not result in increased market share in existing or new markets, then it is not a successful implementation. Applied to strategy implementation in organizations, this means it reorients a bad planned strategy that overlooks the expectations of the executive ranks tends to fail if the executives have no incentives (or bad incentives) to engage in organizational success. They turn to themselves, collect short-term profits and leave. That can be easily avoided by taking in consideration those expectations in first place. If executive ranks feel engaged, they will align their individual priorities with those of the designed strategy and push for its success.

Strategy implementation is a change management problem. Many executives who don't understand change management, or the maths behind it, believe they can 'execute Strategy' by just telling their team to 'get on with it,' and when that fails, they then remove the 'poor managers who didn't deliver' when the fault lies solely with themselves. Good design and good implementation are both necessary. Detailed time planning of all tasks is associated with strategy execution in relation to the strategy formulated. Be flexible in the execution plan, so that the change in results of individual steps can be accommodated to plan subsequent tasks and finally
goal achievement recognition, wherein, individual excellence should be mapped to link them to their capabilities and adequate recognition should be given to them. The strong stakeholders, who are capable and experienced, but do not fit in the specific role may cause the strategy execution effort to fail. Hence, planning the strategy execution during the design stage in detail is very critical,  in many cases, often the strategy that is eventually realised, in many cases, differs from the original plan.

It is crucial for organizations to invest in relevant thought leadership both from a business and technical perspective with a focus on producing a long term strategic roadmap that takes into account the strategic business long term plan along with the technology solutions necessary to enable successful realization along the way. Importantly, what this then provides is clear vision and a point of reference for ensuring all investment decisions on or related to this path and ensure there is always alignment. With the increasing speed of changes in today’s digital organizations, strategy-execution is no longer linear steps, but a dynamic business continuum.


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