The strategy works if executed well. Formulation and execution of strategy are two different things. To make any strategy work, execution is essential. Execution involves a careful and well-planned logical approach that aims at the desired outcome.
A business strategy primarily focuses on products, services, and competition in each industry. Mostly emphasis is on industry analysis and on external forces. Business-level strategy is vital to the success of the corporate strategy. Any business unit must also pay attention to its internal resources and capabilities as it tries to create skills and competencies that differentiate it from competitors. There are essentially a few aspects of the business strategy that affect its execution and must be handled well. These are -The type of strategy and the demands it places on the organization. A business unit’s everyday objectives and performance metrics must be consistent with its strategic goals and plans. It is important to translate strategy into short-term, measurable operating objectives and action plans.
Some of the important factors for the success of any strategy are listed below:
One of the important factor for a successful business strategy is knowledge. Transferring knowledge within the business is vital to strategic success. Integration plays a critical role in it. Integration is relevant to execution at the business level since individual businesses must develop their own ways of achieving coordination across operating units or functions.
The Strategy Review:
Strategy review helps to improve communication. Good communication comes from the effective use of informal contacts, direct communication, and a common language (i.e., clear, agreed-upon metrics and goals).
Execution will suffer if strategic needs are not translated into short-term metrics that are consistent with your strategy. It’s helpful to conduct a strategic review.
A company with a focus strategy that is focused on a particular customer, geography, or product should decentralize. Whatever the structure is, successful execution depends on coordination and information sharing across organizational units, and clear responsibility and accountable company’s strategy drive the selection of the optimal structure. Facilitate information sharing, knowledge transfer, and communication.
Responsibility and accountability:
Clarify responsibility and accountability. Make sure key decisions and actions are clear and unambiguous. Without responsibility and accountability, effective coordination and cooperation simply won’t occur.
Here’s how an organization can use incentives to facilitate strategy execution
Incentives should not demotivate people. Incentives fuel and guide motivation. They don’t create it Good incentives are tied to strategic objectives or short-term objectives derived from strategy. Good incentives reward the right things. If you focus on these issues, you’ll generate both the organizational structure and integration methods that will make your strategy work.
Moreover, it’s critical that the organization rewards the right things, including previously defined strategic and short-term objectives. Plans, objectives, and implementation methods are more often the rule than the exception. Incentives and feedback play an important role in an organization.
Controls provide feedback about performance to reinforce execution methods, provide corrective mechanisms, and facilitate organization. Reward the doers, the performers. Face the brutal facts honestly. Controls require timely and valid information. Leadership plays a central role in the control process. Problems occur when managers aren’t up to the leadership task. Leaders must set an example that’s consistent with execution-related objectives.
Managing Culture and Culture Change
Changing culture is difficult but doable. Here are few rules for managing and changing culture. The reasons for change must be clear, compelling, and agreed upon by the key player. Focus on changing behaviour — not directly on changing culture. Effective communication is vital. There must be an adequate effort to reduce resistance. Beware of excessive speed.
It is important to understand the reason for a failed execution. Some of these are lack of trained managers, lack of interest of top management, long duration in execution than planning, and so on. Moreover, more hands are required to execute any strategy. There are various other challenges in execution like Organizational Structure and Execution Structure that affects real costs and benefits. Different ways of organizing affect outcomes, but creating the right organizational structure is a real challenge. Understand the relationship between strategy and structure Try to find those aspects of strategy that drive the choice of structure.
Support to receive support, execution methods and plans must produce clear, measurable, and positive value-added results. Hierarchical superiors or potential joint venture/coalition partners within the organization will support execution if they can see and measure its results in value-added contributions to the organization.
Successful Execution comes with a good Strategy. It’s simply not true that “good execution can overcome bad strategy.” Typically, poor strategy results in poor outcomes and major frustrations, A global strategy requires management to develop the right resources and capabilities to compete effectively in world markets. The key concept here is a coordinated global strategy, derived from the sharing and leveraging of skills and capabilities across national boundaries. The goal is a strategy that leads to competitive advantage. Various aspects of strategy and planning affect the success of your execution. There is a need for sound planning and a clear, focused strategy.
In this article, I have shared my views on how strategy can work. “Making Strategy Work” by Lawrence G.Hrebiniak is a very interesting book to read in the field of strategy formulation and execution. Let me know your thoughts about this book.
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