Execution Trumps Strategy – Management Library

The results are in – Execution trumps strategy. Your business plan may have great strategies, but it will be a great failure if executed poorly. So just hire the right people, right? Turns out the answer is not what you think. At least according to a recent Harvard Business Review Article.

Five Myths About Effective Execution

Myth 1: Execution Equals Alignment

The typical approach to execution is to translate strategies into specific objectives, assign them to employees, use tools such as management by objectives and balanced scorecards to measure results, then hand out rewards based on performance. To fix implementation problems, adjust the processes that link strategy to action throughout the organization, leading to greater alignment and thus better results.

Unfortunately, in most companies, the problem isn’t alignment. It isn’t even having the right people on the bus. The problem is silo thinking. Their research found that 84% of managers say they can rely on their boss and their direct reports all or most of the time, while only 9% can rely on colleagues in other functions. Two out of three times, those colleagues screw things up.

And even for companies that have systems in place to manage commitments across silos, only 20% of managers believe they do enough good. Most want more structure to coordinate activities across units; more bridges across those silos.

Myth 2: Execution Means Sticking to the Plan

Many companies treat plans as sacred objects. That’s great if obedience is your strongest priority, but it doesn’t encourage agility. Effective implementation requires managers that adapt to changing opportunities and threats quickly, but that’s not going to happen if adherence to the plan trumps all other considerations.

And it’s also not going to happen if capital resources and staffing are tied up in less productive uses, rather than reallocated to support strategic priorities. Most companies, for profit and nonprofit, tend to be very slow to discontinue declining activities, denying resources to growing areas.

Myth 3: Communication Equals Understanding

Communication is good, so more communication is better, right? Not necessarily. Many organizations push out so much internal communication that the important stuff gets lost in the shuffle. Keep it simple and reinforce the central points.

Myth 4: A Performance Culture Drives Execution

What matters is what you do, not what you say. While many organizations offer a compelling official culture, reflected often in core values listed on the web site, but in practice what tends to get rewarded is individual or team performance (certainly a good thing), while collaboration across units, ability to adapt, agility and risk-taking, those attributes are rarely rewarded.

Too much focus on a performance culture leads to an unwillingness to experiment, to be open about challenges, to take risks that might lead to set backs. In other words, keep it safe, hit your numbers, that’s the real internal culture at most companies. And that doesn’t encourage the kind of openness and risk taking that’s essential for long term success.

Myth 5: Execution Should Be Driven from the Top

While leadership from the top is essential, an execution-driven organization needs to encourage middle managers to have the authority to make execution decisions on their own, taking initiative and ownership of the results rather than expecting all of that to come from the top. Get clarity on the objectives, then managers figure out the best ways to get there.

Thoughts?

Good luck!