The Failure Rate of Strategy Execution
Does your strategy have enough external perspective? Clear strategies — even those that are carefully designed — fail at an alarming rate. Just five years ago it was reported that two-thirds of corporate strategies failed due to poor strategy execution.
While this is not new news, the negative impacts are growing exponentially — not only in time and effort but also in dollars, missed opportunities, and employee retention. The good news is that, done right, a successful strategic plan aligns a company up to perform beyond the sum of its parts.
Where Do Things Go Wrong Between Strategy Planning and Implementation?
There are many different perspectives. Some say the high failure rate is due to a lack of competent and well-prepared leaders. Others point to unclear goals and roles in the Executive Suite or misalignments between the strategic vision and the way work gets done on a day-to-day basis.
The failure of strategy execution can be the result of all of the above to one degree or another. But one powerful way to analyze the problem of getting from strategy to effective execution is to ask yourself if the strategies you developed during your strategy retreat have enough external perspective.
Failure to Consider the External Context
So many executives are overwhelmed by the pace, enormity, and complexity of their jobs. It is often tempting to hide behind internal issues and workplace politics where they can manage performance, resolve conflicts, and work to reconcile budgets. But the real secret to strategic success requires a much broader view.
Strategic leaders flip how they spend their time and invest heavily in keeping on top of emerging customer, competitor, and technology trends. Sadly, 70% of leaders on average report that they spend only one day a month on strategy while their teams spend less than one hour a month. Instead, leaders should focus not simply on internal operations but on their organization’s business in the context of their marketplace.
Choices to Make
Effective leaders make good decisions that are based on clarity, judgment, and courage. They have to:
Their job is to steer the company in a shared strategic direction that leads to success for the business AND for the people. That can only be accomplished with an eye to what’s happening beyond the internal operations. An external perspective is critical.
The Bottom Line
Successful strategy execution must rely to a great extent upon understanding the context in which your organization operates. Are you continuously evaluating changes in the marketplace that will affect the success of your strategic plan? If not, your plan may become another of the majority of execution failures.
To learn more about getting strategy right, download 7 Ways to Stress Test Your Strategy before Moving to Implementation
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