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Posted: July 18, 2011

Why does execution take the back seat?

How to align it with strategy

Bob Hills

You have probably noticed the abundance of books and articles focused on business strategy. In each, the author professes how to make you and your business more successful. Have you ever wondered why there aren't as many materials focused on business execution? Isn't it just as important to quickly and reliably implement your business strategy as it is to develop it?

When it comes to coverage by educational institutions, books and the media, business execution takes a backseat to business strategy. In a recent survey of Amazon, a search on the phrase "business strategy" returned 43,291 books. A search on the phrase "business execution" produced 696 titles. That is a 63-to-1 ration in favor of business strategy.

Simply googling "business strategy" generates greater than 123 million hits, while "business execution" only generates about 7 million - an 18-to-1 ratio biased toward business strategy. While these surveys aren't the pinnacle of business research, they illustrate the persistent emphasis on business strategy over business execution.

While this comparison is interesting, the more critical issue is that many businesses and executives are failing due to poor execution. Several surveys revealed significant statistics about execution:

• 90 percent of well formulated strategies fail due to poor execution (Harvard Business School Press)
• 70 percent of CEO failures come not as a result of poor strategy, but of poor execution (Fortune Magazine)
• 66 percent of corporate strategy is never executed (Ernst & Young)\

So why do businesses fail at executing their strategy? Many businesses fail because "execution is extremely hard". One Wharton Business School study reasoned that:

• Managers are trained to plan, and not to execute.
• Planning and execution are not treated as interdependent which can lead to major disconnects between strategy and what is, or can be, executed.
• Managers don't stay engaged in execution. Top managers typically leave execution to the ranks of the organization and review progress periodically at best.
• Execution requires more people and time than strategy formulation. Unlike strategy formulation which is performed as an action-step by a few people, execution is a business-wide continuous process.
Many companies today are running flat out in all directions taking very little time for introspection. To get a benchmark in your organization, ask employees throughout your business the following questions:
• Are you familiar with the company's strategy?
• Do you know what you need to be doing in your role on a daily basis to move the company towards its goals?

Execution of a business's strategy requires communicating strategic intent and aligning all individuals (and systems) in the organization to act accordingly. In many companies, few people can accurately articulate the company's strategy. People either do not know the strategy, or think they know but have it wrong. Will these people move the company towards its goals? Only by chance.

If your business is suffering from these symptoms, the situation isn't hopeless. However, it will require energy, discipline and perhaps a change in attitude to establish the proper emphasis on execution.

While the emphasis here is on execution, the key principle at play is aligning strategy and execution. To address short-falls in execution, consider utilizing a methodology (process) that fully aligns strategy formulation, operational planning, execution management and business review. Some or all of these elements may be employed by businesses today, but they frequently lack the discipline, consistency and alignment necessary to succeed in executing the strategy.

Aligning strategy and execution in your business can help you achieve your business goals more reliably and more quickly, increase operating margins and increase employee job satisfaction. The net result is a higher overall business value.

So the next time you reach for a business strategy book, ask yourself if your biggest challenge is with your strategy or in executing it. Chances are your time would be better spent leading the execution of your existing strategy.
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Bob Hills considers himself a ‘recovering high-tech executive'. He spent 30 years as an executive in global, high-tech firms where he was instrumental in growing concepts and young product lines into mature businesses. After ‘executive rehab', Bob founded Classic Business Logic - a firm dedicated to educating and coaching businesses on the practices and benefits of execution management or, as he prefers to call it, strategy-execution alignment. Bob primarily works with businesses that are struggling to execute their strategies or are interested in scaling their business operations to the next level. For more information visit wwwclassicbusinesslogic.com or contact Bob directly at bhills@classicbusinesslogic.com or by calling 970-389-3634.

 

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Readers Respond

Bob, excellent points. The irony is that a good strategy includes planning for execution of the project, plan, idea. Many times leader(s) for the strategic plan get confronted by the mountain (their perception of the goal they created, no matter the size), realize they are not mountain climbers (the elements are outside of their control), and burrow in where they are at (stay in comfort zone). Many fail to realize that all it takes are focused steps in the right direction to execute a great goal! Great time to hire a business mentor/executive coach to have you do what you don't want to do so that you can achieve your goals! By Jeannette Seibly on 2011 07 18
Executing strategy means making changes. The only case where this isn't true is when the strategy is to 'do what we did last year' - which often what everyone in the company wants to do - but no one is willing to say that. Making changes is very hard - which isn't necessarily a bad thing. If we were making changes all the time, it would be chaos and nothing would get done. Some push back to change, to make sure it is worthy of the costly disruption, is healthy. Very few managers have the skills and gumption to make changes. There are as many social skills involved with doing this than there are technical and business skills. Making changes also has 2 major factors that can't be ignored: 1) Making changes adds to the work load - and no employees want to work even longer hours. 2) The change/strategy being advocated might be a bad idea. Very often, it is a recycled idea that didn't work when it was tried 6 years ago when the previous CEO tried it. A manager can ruin his own credibility if they champion the staff to make an extra effort - and the change does not have the expected positive impact. Sitting in meetings and talking about what needs to be done is much easier and poses less risk to a manager's career - plus, everyone goes home on time. I agree that execution is seriously lacking and holding businesses back. For a strategy (change) to work, though, it has better be a very good, well-thought-out idea and was developed with the people that will be making the change. To get people to make the effort, they need to see how the change will personally benefit them. If these things are not taken into account, then it will be just another year of strategy status meetings and excuses about limited resources. Scott D, COO By Scott D on 2011 07 18

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