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Turning Great Strategy Into Great Performance

Most companies strategies delivers on average 60% to 70% of the promised financial value. This is a true global average based on research, why is this the case?

First many executives confuse the need for strategy and the capacity to execute strategy. When things aren’t going right, the temptation is to call for a change of strategy, when that may not be the actual case.

Executives must understand strategy to action as a discipline that is multi-faceted and that capacity to execute
strategy must be develop throughout the organization.

So what can we do to get strategy execution right?

To have in mind that strategy development and execution are inextricably connected – sides of the same coin

We could also follow the following guidelines in order to raise the probability of strategy results:

  1. Keep the strategy simple – our rule of thumb less than five pillars/strategic themes per planned period. We often many poorly crafted strategic pillars that are numerous to track and follow
  2. Reward and develop execution ability – this issue cannot be over emphasized. There is no great strategy than the people to execute it. Corporates needs to identify, recruit, retain and develop human capital with capacity to execute strategy – more so create and maintain a conducive environment for performance action to occur. In this I refer to both Board, CEO and Staff. Performance rewards are oriented towards recognizing superior execution ability and are a motivation for both the Board and staff to give in their best to push the organization forward. Organizations must remember to keep their promises especially on rewards otherwise they risk a culture of broken promises which could lead to dysfunctional teams and eventually losing their best performers.
  3. Decide resource allocation during strategy development – sometime we find strategic themes with no staff or direct units responsible or corporate strategic plans with no resource plans. Decide resource allocation early human capital or others
  4. Make strategic choices explicit – making priorities known at anyone time is important and it is the job of all leaders and section heads. This clarifies what priorities are at any period – the area of focus this week, month, quarter et cetera based on identified need or market feedback
  5. Continuous monitoring of implementation – adopt a continuous system of monitoring implementation. Define what must be tracked daily, weekly and monthly. Any other interval e.g. quarterly is a function of these. This increases chances of taking corrective action early and opportunities for mentoring and coaching.

With the above among others guidelines corporates could reduce strategy to performance gaps and perhaps achieve better results from their developed strategies.

At PKL we have helped organizations build on capabilities to execute strategy with great success. Our overall work in corporate transformation also focuses a lot on developing performance rewards, capabilities to execute strategy including relooking at aspects such information flows, clarifying decision rights and overall organizational structure.

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