Wednesday, June 24, 2015

Strategy Execution: How Difficult Could it Be

The super execution is the result of synchronization of all key business factors.

Nowadays, with increasing speed of change and fierce competition, business strategy execution is no longer linear steps, but a dynamic continuum. If strategy formulation is more important for leading business toward the right direction, then strategy execution is perhaps more difficult due to the business complexity, uncertainty, time/resource consuming, etc. The strategic themes are essentially the pillars of the organization. They include business growth, operational excellence, customer experience excellence, product development, innovation, and sustainability. Strategic perspectives include financial aspect, customers and stakeholders' aspect, internal processes, organizational capability and engaged leadership. Strategy execution: How difficult could it be?

Resource assignment: Organization leaders will allocate the resources (time, money, and people) that enable execution. However, resources are only part of the formula. What gets measured, gets done. Leaders need to examine execution progress against the strategy on a regular basis to ensure successful execution, and how flexibility has to be structured and resonates towards the importance of accountability. Giving people clear responsibilities and holding them accountable is indeed very important for successful strategy execution. Commitment begins from the top! If the top Management takes out time for the formulation, then not only the employees but also the Stakeholders and suppliers will have a clear understanding of what is to be done. Which itself is a motivating factor? Leaders need to own the execution process of strategy and follow up to ensure success plus building internal capabilities. Buy-in is required across the organization, but leader ownership is critical to be accountable for result delivery.

Culture eats strategy for breakfast everytime. Neither strategy formulation nor strategy implementation is difficult if you know what you're doing. It’s rare that a strategy's business case will be sufficient to win the support needed through a document or presentation by itself. Many organizations are inherently political. This is often a cultural trait of the organization often caused by fear, bureaucracy, and the threat of losing authority and status as a cultural characteristic as well as a result of certain types of strategies. Also, the advent of digital technologies will change the way firms approach their execution of strategic process management initiatives. For example, the effective application tools can be quite useful in cascading the strategy down into the organization, translate the strategy into KPIs and monitor their performance. And the great value in collaborative technologies allows for more democratic decision-making and increased collaboration and information sharing across functional departments. Digital technologies can also be very helpful in strategic analysis as well. Don’t underestimate the power and dysfunctional influence of the culture of inertia. Strategy execution means to take action, it’s about changes. If people resist to change, then, execution won’t go too far. Therefore, in order to minimize the impacts of this issue, it’s recommended that you:
-Communication: take the time and effort to meet with all important members of your various audiences, to talk through what is proposed, what is the likely impact on them, and what is expected of them before the strategy is implemented, during implementation and after implementation.
-Empathy: Capture and record their questions, issues, and their concerns. Ensure that their concerns are identified (anonymously if possible) in the business case, and discuss the manner you propose to satisfy those concerns. If you can 'live with' their solution to important issues and problems within the strategy, it will be harder for them to withhold approval or cooperation.
-Clarity: Ensure that you spend time explaining the benefits of the strategy to them and their area of responsibility. If they don’t know or aren't convinced of the benefits, then why would they support the strategy?
-Commitment: Don’t leave the meeting without knowing what it will take to get their support for the strategy.You may also encounter 'gate-keepers' through whom you need to navigate the strategy, and who don’t have a real direct interest in the strategy or who are not directly affected by it. You still need to meet with them and secure their approval too. This is usually done by explaining the benefits to them or their responsibility area from the successful implementation of the strategy.

PPM: Another interesting link to explore is the driver for identifying key strategic processes and PPM. It is usually the parameters that affect customer experience the most which are key. In essence - customer experience is fundamental to how processes should be managed. This is an important issue to understand that the processes in your business will create and deliver the result. Many times you don't consider the processes as the main driver to deliver the desired result, and then you will not get the result you hoped for. The processes are the tool to get the result you formulate in the strategy. Also, it’s important to highlight the real value of the Project Portfolio Management (PPM) can bring to support strategic planning and execution. If projects are the principles vehicles being used to deliver the strategy, then executives need to have just enough visibility about this project execution layer and how the projects and programs are performing in order to monitor progress and make the right decisions to ensure that the strategy potential is achieved.

Balanced scorecardBalanced scorecard helps translate strategy into key performance indicators. In strategy based balanced scorecard, organizations try to align its strategies to corporate goals and objectives and cascade strategic intent to all departments of the organizations. Like the balanced scorecard approach. It helps organizations translate their strategy into key performance indicators that can be cascaded down to the department, teams, and even individuals. This is a great way to set objectives and monitor them. However, it is not easy to develop sound KPIs. As Drucker is supposed to have said: what gets measured gets managed. Costs, profit are easy to measure, but, even more, important ones such as quality, customer satisfaction, employee satisfaction and environmental impact are much more difficult to measure. As a result, they are often left out of balanced scorecards and therefore not managed. Furthermore, developing, managing and monitoring objectives is crucial for successful strategy execution. However, soft aspects such as leadership, empowering employees, motivating employees, explaining the strategy etc are as important, if not more important. Such key practices are not part of the balanced scorecard.

The super execution is the result of synchronization of all key business factors; organizational agility, intelligence, strong disciplines and management practices. Strategy execution is difficult, there are many roadblocks on the way, however, it can be managed well: From effective leadership to execution culture; from proactive planning to rigorous processes; from measures to balanced scorecards; the super execution is the result of synchronization of all key business factors; organizational agility, intelligence, strong disciplines and management practices.


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