Building a winning strategy is what executives often think of as being the greatest challenge in leading organizations to victory. A larger challenge than that is to sustain that focus throughout the organization, all year long, bringing it to life. Therefore, strategy management is a much broader topic than formulation or communication alone. It begins with creating a compelling story about the future, but it requires a purposeful and ongoing process to aligning all of your teams … all of the time.
Why is this so important? Doing this well allows you to:
1. Develop a clearer picture of what you’re working to accomplish … so that your people understand HOW you’re going to create an advantage over your competitors
2. It allows you to: Translate your strategy into divisional terms … so that all teams understand their role in making it successful
3. Finally, it allows you to: Monitor, learn and adapt … Using a balanced scorecard and both team and personal accountability frameworks … to provide you with feedback on all parts of the business, and hold everyone accountable for results.
At times, stopping to talk about strategy at an operational level seems like a distraction from something that is more pressing, however, there is one reason why I’m drawing your attention to this issue: 90% of organizations fail to achieve what is described in their business plan, instead delivering an average only 63% of the promised financial results! The reason for this is a lack of the ability to execute strategy, which, not incredibly is the reason why 70% of CEO failures occur.
The root cause of these challenges isn’t as complex as you’d think. On average: “one in 20 employees understands the company’s strategy, more than half of organizations do not link budgets and strategy, and the vast majority of executive teams spend less than one hour per month discussing strategy.”
As the prominent British scientist, Lord Kelvin, stated a century ago : “I often say that when you can measure what you are speaking about, and express it in numbers, you know something about it; but when you cannot measure it, when you cannot express it in numbers, your knowledge is of a meager and unsatisfactory kind. If you can not measure it, you can not improve it.”
By implementing just a few changes to your business planning processes, you’ll increase your ability to differentiate, which is all about leaving a lasting impression with customers about why you’re better than your competitors.