Many business leaders are debating the value of strategy in the current market. Here’s why strategy and its execution remain a company’s lifeblood.
With quick-change trends and market volatility, is strategizing still worth it? Are annual strategic planning sessions a waste of time anymore? Would greater agility be achieved by steering quarter to quarter or even month to month instead of trying to look out toward an unpredictable horizon?
These are the types of questions many executives are asking themselves, even if they don’t come clean publicly about their misgivings.
With global upheavals arising one after the next, some leaders are understandably losing faith in the typical three- or five-year strategic plan. Why set goals years down the road when a recession could happen next month?
Here we explore research around strategic planning, access the value of strategy, and discuss how you can make the most of it in today’s world.
How Strategy Nourishes
We live in a fast-paced world. Businesses can’t avoid that. The dizzying speed of market changes makes some companies believe strategy isn't worth the effort, time, or cost.
After gathering responses from over 6,000 corporate leaders and senior managers, Strategy& reflected, “Given market volatility—many leaders feel their industry is going to be turned upside down—leaders feel pressure to respond fast. They often believe that strategy is a luxury they can’t afford.”
But strategy is not a luxury, and undervaluing it can be fatal for what could otherwise be a thriving organization.
In a Forbes article, Strategy&’s global managing director Paul Leinwand, who researched companies with the largest shareholder value losses over a ten-year period, stated, "Of four possible types of failure — operational, compliance, external, and strategy — strategic blunders were the primary culprit 81% of the time.”
Although a powerful strategy certainly helps with profits, it also adds so much more.
Provides insight for resource allocation. Developing a strong company plan includes analyzing areas for improvement or change. This information allows you to give necessary support (and resources) to different areas of your organization.
Helps businesses reach goals and track progress. How serious can you be about accomplishing goals if you have no plan? Instead of just hoping things work out, strategy helps you outline specific steps for achievement. It also allows the organization to measure progress and track company and individual performance.
Unites employees under a vision. Strategy boosts workers’ morale. When employees know a solid plan is in place, it builds their confidence in the business and their role. If the company’s purpose (and their work purpose) is clearly connected to the strategy, it can motivate them.
Increase Your Strategy’s Vitality
Creating a strategy is one thing. Implementing it is another.
Research shows 48% of all organizations fail to meet at least half of their strategic targets. Why? Poor strategic planning and execution. Much of a strategy’s value lies in how effectively its carried out.
According to the study done by Strategy&, companies with effective strategies in place show “faster than average growth” (48% compared to 15%) “and profitability” (47% compared to 22%). Good strategy implementation means better payoffs for your business.
What goes into an advantageous strategy? How can you ensure the execution process works?
1. Insightful Research and Planning
Does your strategy focus on your differentiating capabilities? A key element of a business’s survival resides in knowing the value you provide your customers. What market niche are you a part of, and what makes your organization stand out? What does your business do better than the rest?
Research the market and your organization’s history. By incorporating your differentiating capabilities into your plans, you are already ahead of many companies.
Another thing to consider when creating a strategy is pliability. Unexpected events are part of life. Your strategy needs to be a living thing, something that evolves as needed with thoughtful foresight.
2. Powerful Execution
Flow of information. Strong strategy execution starts with a clear and open movement of information. Outline how you are going to carry out the strategy. Assign roles and make sure everyone has access to the knowledge and decision rights they need.
Encourage collaboration and conversations between departments. Communicate goals so everyone is on the same page, knows how they contribute, and understands how they will be held accountable.
Decisive action. “Employees at three out of every five companies rated their organization weak at execution—that is, when asked if they agreed with the statement ‘Important strategic and operational decisions are quickly translated into action,’ the majority answered no,” a Harvard Business Review article stated.
Strategy means nothing if it’s not carried out thoroughly. Employees should know what actions they are responsible for and hold the knowledge or training necessary to do their part. Clear, realistic goals and deadlines help keep everyone on track.
Live the strategy day-to-day. Once you put your plan into action, follow up. Starting with the top leadership, get everyone on the same page. Inspire and hold departments accountable, make sure goal progress is reported, and ensure everyone is up to date on what the next steps are.
3. Tools to Help
Line-of-Sight is a provocative, compelling catalyst of the critical discussions leadership teams must successfully carry out on an ongoing basis to ensure they know where they’re headed, what they’re trying to achieve, and how well they’re doing in terms of making that happen.
Our Strategic Intent is “to provide every organization with simple, confidence-inspiring analytics and solutions that build their internal alignment and get things across the finish line.” We are “Disney friendly and Apple Innovative, based on customer intimacy and adapting the application of the solution, which itself does not change.
Learn more here: https://www.imprinttalent.com/execution-excellence
Don’t Just Survive, Thrive.
Avoid a death sentence for your business by engaging in healthy strategy execution. With a strong plan, you can build an enduring business that will experience growth and success for years to come.