What Is Your Strategy’s Velocity? Or: Why Most Strategies Fail
Most strategies are never really implemented and executed. This applies to businesses in any industry, non-commercial institutions and not-for-profit organisations.
- tremendous efforts are wasted in “investments without return”;
- employees and customers alike become frustrated; and
- ultimately, your capability to accomplish your company’s mission deteriorates.
If you are faced with competition, you lose precious time from which your competitors will benefit, for example by increasing their market share.
Why do most strategies fail? Even though the causes vary case by case, there are a number of recurring factors for effective strategy implementation and execution that are often neglected. Essentially, the route to success should be paved early in the strategy development process. Like with product development, the later you have to make adjustments, the more expensive and risky your product becomes.
What are the key reasons for failing strategies – and how can you as CEO or senior executive overcome the obstacles and turn your strategy into success?
1. Too Complex
Most strategies are too complex to ever get executed. Strategy is about direction, and the direction gets lost if its key elements – if there are any – are spread over thirty slides or fifty-page documents that nobody reads or understands. A good strategy can be summarised on two pages.
Why is that important? Strategies are implemented and executed by your employees. They therefore need to understand them, and they need to buy-in. Complexity leads to ambiguity and procrastination.
What are the root causes of high complexity? Uncertainty, unclear accountability, missing leadership. You need to know what to write on those two strategy pages. As preconditions, you must have a simple vision with a finite time horizon, you must make important decisions quickly, and you must be open to new ideas and inspiration. Most leaders that we meet fail at least at one of these, and many at all three.
Turnaround: Make simplicity a guiding principle of all your strategy work. Avoid complex phrases. Make relationships clear. Use simple diagrams instead of wordy explanations.
2. Too slow, and with too much effort
A key to the success of a strategy is getting quickly to the point, creating momentum of action and results. The reality looks different than theory. Many leadership teams spend too much time by far on data analysis and number crunching about markets, competition, and customers. These phases of preparation sometimes last months. Ask yourself: “How much of this information do I really need to create the strategy?” Which part of it only serves to postpone making necessary decisions?
A good strategy starts with your vision. Agree on one vision with your leadership team and define routes of how you will get there from your current situation. Sure, you have to know if the vision is achievable at all, and yes, you must know your business as-is.
My point is this: Aren’t you and your leadership team already in a position to draw that picture? If not, there might be a serious issue with the leadership team’s competence rather than a mere need for more data. Save your time and instead invest your energy in convincing vision, goals, and strategic initiatives. Velocity is a decisive factor for successful strategies.
3. Not Communicated
We often identify a lack of communication as a key reason for under-performance by our customers. Remember, a non-communicated strategy does not exist. Your employees execute strategies and they need to understand where the journey aims.
Tip: Create a simple communication plan right at the beginning of your strategic work. Include as many direct channels of communication between leadership team and staff as possible. And don’t forget to implement an easy-to-use feedback platform for your employees, allowing you to gather their unbiased input.
4. Not visionary
The main purpose of strategy is to focus the efforts of staff and other stakeholders in a clear and unambiguous direction. This can only succeed if the vision describes an imaginable goal. A statement like “We will be perceived by our customers and employees as an important player in our market segment” is meaningless and will result in ignorance, failing to motivate your employees.
Instead, define a BHAG (“big, hairy, and audacious goal”) that is achievable within 3-5 years. In exceptional cases, the target period can be of longer-term. Here is a statement of one of the best visions of all time: “Before the end of the decade, we will land a man on the moon and bring him back safely to earth.” J.F. Kennedy, 1961. How close is your vision to this scope?
Important: Don’t confuse your vision with your mission or purpose. The latter describes the “raison d’être” of your organisation. The former specifies where you want to go and what you want to achieve.
5. Unclear accountability
Clear accountability is an absolute precondition for successful execution of strategy. Even the best strategy fails if it is not clear who implements the decided measures or if decisions are repeatedly re-discussed.
Tip: Define UNAMBIGUOUS accountability at the very beginning of your strategic work. Later, you can bring other people on board. By all means, there must be a decision-making body that is accountable for the whole strategic lifecycle, from definition to the end result.
Don’t forget to communicate that accountability. We have seen cases in which people were assigned accountability without being aware of this.
6. No measures of success
A strategy is not a wish list of initiatives with optional execution. The well-known “you can only manage what you measure” applies to the implementation of strategy just as much as it does to other management tasks.
To allow for measurability, all strategic elements – such as vision, goals, initiatives, and themes -should be as specific as possible.
Tip: Build in measurability of your strategic objectives right from the beginning. Assign measures and targets to EACH objective. These do not always have to be numeric. However, they must be specific enough to identify their accomplishment. As a next step, establish a simple mechanism for monitoring progress. This should consist of easy-to-understand reports and regular – usually monthly – strategy execution meetings.
Important: The method you choose is not decisive. However, the measures of success must be simple, consistent, and constant until the objectives are accomplished.
7. No plan for execution
A strategy is a strategy, and a plan is a plan. They are two fundamentally different things. It is essential for the success of your strategy that you first develop it and then define plans for its execution.
Tip: Define strategic initiatives for each measurable objective. Assign ONE person (ideally from the leadership team) to be accountable for each initiative. His or her first task is to develop a detailed action plan including due dates and responsibilities for each action item. Though this sounds easy, we have seen strategies fail at exactly this stage. By managing with action plans, strategic execution becomes transparent, progress is measurable, and staff buy-in and motivation increase.
The described measures significantly increase your strategy’s velocity and its chance for success. At the same time, they reduce the efforts and costs required for strategy development and ensure the high motivation and buy-in of your staff. The success of your strategy becomes a success of each manager and employee.
Your strategy turns into reality.
Author: Volkmar Voelzke
Article Source: http://EzineArticles.com/expert/Volkmar_Voelzke/553017