Successful Strategy Execution

I am grateful to Gary, Karla and Elizabeth for making a boring flight from OAK to AUS enlightening with thier HBR article – The Secrets to Successful Strategy Execution.

According to the authors, when comapnies fail to execute the strategy, the first thing managers do is restructure.  However, based on their research, fundamentals of good execution start with clarifying decision rights and making sure the information flows where it needs to go.

More importantly, the authors have defined traits that make an organization effective at implementing their strategies (in the table below).  I took one of my ex-company and provided my evaluation of how did my ex-company measure up against this traits.  I have deliberately kept the company name confidential (because I can :-))

 

Rank

Organizational Trait

Company X

1

Everyone has a good idea of the decisions and actions for which he or she is responsible

Sporadically true. Some groups/managers had a good idea, but not all groups

2

Important information about competition gets to headquarters quickly

True

3

Once made, the decisions are rarely second guessed

Not true.  The decisions were second and third guessed all the time

4

Information flows freely across the organization

No.  Senior management seemed to follow “mushroom theory” – keep them in the dark and feed them shit

5

Field and line employees usually have the information they need to understand the bottom-line impact of their day-to-day choices

No.  Field folks didn’t seem to care about cost of sale

6

Line managers have access to the metrics they need to measure the key drivers of their business

True

7

Managers up the line get involved in operating decisions

Not at all

8

Conflicting messages are rarely sent to the market

True to large extent, with the exception, the company use to announce a new hot concept during every annual tradeshow. The concept, filled with marketing-speak, was never backed by a solid roadmap and in many case, never realized fully.

9

The individual performance-appraisal process differentiates among high, adequate, and low performers

True

10

The ability to deliver on performance commitments strongly influences career advancement and compensation

True

11

It is more accurate to describe the culture of this organization as “persuade and cajole” than “command and control’

No, it was more like “command and control”

12

The primary role of corporate staff here is to support the business units rather than to audit them

Not applicable

13

Promotions can be lateral move

No

14

Fast –track employees here can expect promotions more frequently than every three years

No

15

On average middle managers here have five or more reports

True

16

If the firm has bad year, but a particular division has a good year, the division head would still get a bonus

No

17

Besides pay, many other things motivate individuals to do a good job

Partly true

Authors provide an simulator that one can use to diagonse the current state of organization from strategy implementation effectiveness perspective and chart a path to reach the next level.

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