The game of business strategy is played in the board rooms, while the game of its execution gets orchestrated in the ‘trenches’. Strategy formulation is more of an intellectual endeavor, and execution is where ‘rubber meets the road’. Strategy’s frame of reference is top-down and outside-in, while execution is bottom-up and inside-out. For holistically delivering targeted customer and business outcomes, an ongoing alignment between strategy and execution, which is based on a continuous feedback loop, is paramount. According to studies, 60-90% of strategic plans never fully launch*. Execution failure, among other things, is usually identified as a key reason for such a sub-optimal outcome.
Having led or contributed to a large number of transformation advisory and/or delivery engagements (including set up of new units/functions and engagement turnaround scenarios) of varying sizes, complexities, and defining characteristics across global geographies, the primary reason for execution failure has been in what I would call the ‘zone of ambiguity,’ i.e., the confluence between strategy and execution. If not managed well, it can lead to significant work at cross purposes, leading to confusion, frustration, and derailment of the entire strategy. Execution is always complex, so the focus and effort required to drive outcomes should never be underestimated. However, all other factors of a successful strategy being in place, the presence of certain key drivers, have been found to set the successful initiatives that seamlessly cruise along, significantly apart from the ones that stumble every step of the way. In most instances, an issue with execution can be directly attributed to the absence of one or more of these obvious and not-so-obvious drivers:
Driver 1: Clear understanding of the context
Understanding the delivery context is the starting point for any execution initiative. An inadequate or half-baked understanding is a sure-shot recipe for failure. While context is a broad and ambiguous term, and there can never be a ‘perfect’ understanding of the context, there are aspects listed below that can help form a well-rounded perspective and make the context clearer:
- Business environment, operating model(s), and governance framework(s) and practices of the organization and of relevant business unit(s) accountable for the execution initiative.
- Initiative’s objective(s), its linkages to strategy and history, if any.
- Roles and expectations of key stakeholders.
Driver 2: Continuous validation of assumptions
By their very nature, assumptions tend to sneak into the day-to-day work without notice and without anyone noticing. For the most part, the assumptions, if reasonable, help make work simple and efficient; however, serious issues can arise when not all stakeholders are on the same page with respect to any assumption made at the outset, especially about critical matters like target customers, business capabilities, competitive landscape, funding or its drivers, schedule, scope, sponsor, applicable policies/procedures/regulations, delegated authorities, action owners, understanding of professional/industry jargons and all the other aspects outlined in Driver 1 above, besides many other things, and especially when such a disconnect is discovered late in the delivery lifecycle. So, it is imperative to surface, explicitly call out and validate all the key assumptions, how innocuous they may seem, and ensure validation at the earliest of any unvalidated or new assumptions that emerge in due course.
Driver 3: Clear and targeted communications
For every communication, always consider 4Ws and 1H, i.e., Why to communicate, What to communicate, Whom to communicate to, When to communicate, and How to communicate. Good news must travel fast, and bad news even faster. At times one may make an error of opinion, but one should never make any error in facts. Ensure to keep all relevant internal and external stakeholders with a ‘need to know’ in the communications loop. Over-communication done consistently, especially on critical matters listed in Driver 2, never hurts. Hyper-transparency unearths potential issues early on and establishes trust, which is a change accelerator; however, keeping matters nebulous breeds mistrust, confusion, lurking issues, and a highly politicized environment.
Driver 4: Well-defined, understood, and established processes, policies, and procedures
Processes are the engine that can make work of any intensity and complexity traverse seamlessly on the rail tracks of an organization’s physical and technological infrastructure. They are needed not just for BAU operations but also for initiatives. Coupled with well-defined policies and procedures, they can make any work a breeze. However, for that to happen it is not enough to just define the processes, policies and procedures but also need to ensure they are i) properly understood by the relevant employees and stakeholders, and ii) well embedded into the organization’s ways of working.
Driver 5: Clearly documented and understood roles and responsibilities
Clearly documented and understood roles and responsibilities help define the boundaries of work for all employees and stakeholders. Coupled with Driver 4, they are critical to prevent i) the proverbial ‘ball from falling through the cracks or ii) people working at cross-purposes.
Driver 6: Equitable recognition
If processes are the engine of work, then equitable recognition is the fuel to ensure the work accomplishes or surpasses the stated objectives. The higher the degree of equitable recognition better will be the quality of fuel. The responsibility for defining and operationalizing a robust framework for such recognition, which is free of biases, rests primarily with the organization’s Business, Divisional, and Human Resources leadership team.
The ‘zone of ambiguity’ can evoke a strong sense of apprehension. However, with a focus on the key drivers coupled with a discerning mindset, the pathway to the desired end state can be demystified, making it easier to navigate this zone in an organization’s journey towards execution excellence.
* “4 Common Reasons Strategies Fail”, HBR, June 2022
Satish has over two decades of C-Suite advisory and execution experience in delivering sustainable outcomes for Financial Services clients globally through Strategic Transformation Design and Management across Business, Technology, Finance and Operations domains.