Strategy Execution

Strategy becomes execution-ready only when it is ingrained into the management processes and the employees of the organisation. The most effective approach to achieve this is by developing and implementing a set of essential strategy execution competencies. These competencies facilitate efficient two-way communication between strategic plans and operations, serving as the foundation for bridging the gap between brilliant strategies and superior performance.

While strategy and operations can be developed independently, it is their synergy that creates superior value for stakeholders. You may have heard of companies where strategy planning occurs in isolation at the head office, yet operational executives ultimately steer the business. Alternatively, there are instances where strategy personnel bypass operations management and issue direct orders to front-line staff. Does this sound familiar? Many companies have developed excellent strategies but faltered in executing them profitably. Conversely, there are even more companies that employ ‘simple’ strategies but excel in effectively channelling them throughout the organisation to deliver a clear vision, mission, objectives, and goals to each operational unit. These companies often achieve better results and operate with lower vulnerability and risk.

A bridge extending from strategy toward operations comprises specific internal processes, procedures, capabilities, and company culture, collectively known as execution. This extension of strategy should be considered as an integral part of the strategy framework. Moreover, the capability for strategy execution can be assessed, described, measured, analysed, and enhanced.

While strategy formulation delineates products, markets, business models, and objectives, it typically does not directly determine business outcomes, whether positive or negative. If your company is currently facing challenges, even if you suspect that your strategy is outdated or lagging behind competitors, I would recommend beginning with an analysis of your strategy execution and/or operations. Addressing immediate issues in areas such as sales incentives, debtors management, or production costs could quickly improve your cash flow from deficit to surplus. Even if strategy reformulation becomes necessary, these insights can provide a clearer understanding of which strategic competencies are lacking and require upgrading.

The process of strategy execution must be dynamic and adaptive, capable of responding to unanticipated events. Execution demands involvement at all levels of your organisation. The notion that higher executives (owners) can delegate execution to lower levels is simply false. “Let the grunts handle implementation” is a formula for certain failure. Experience has shown that relatively few major initiatives are executed well, with reasons ranging from involving too many people to implementing processes that take too long. Other factors that hinder execution include poor communication, sporadic information sharing, weak organisational structure, inadequate coordination, undefined accountability and responsibility, and a culture resistant to change.

To analyse strategy execution practices within an organisation, we must first break down this capability into key competencies and define best practices for each. This will provide benchmarks that can be used for assessment. Drawing from 35 years of experience, including over two decades in management consulting, I have compiled a list of nine essential competencies that constitute the strategy execution framework.

1. Executive management
2. Commitment to processes and procedures
3. Information management
4. Financial planning
5. Selection of strategy execution objectives
6. Selection of key performance indicators
7. Team and individual management
8. Change management
9. Risk management