How to execute a new strategy

strategic-plan

By FRANCIS FONDO

Even at this day and age, many organisations view the launch of a strategic plan as an end to itself. There is normally pomp and celebrations during the launch where the full board, management and staff including, shareholders are in attendance. After the celebrations, everything is left to management to implement. Everyone else retreats to their cocoon hoping results will flow automatically.

Once the Board of Directors and management have decided on the strategy, emphasis should turn to converting it into actions and good results. Putting the strategy into place and getting the organisation to execute it calls for a different skill set. Whereas crafting strategy is largely a market driven activity, executing strategy is primarily an operation driven activity that revolves around the management of people and business processes.

Successful strategy making depends on the vision of a business, competitive analysis and shrewd market positioning. Strategy execution calls for an excellent job with and through people, building and strengthening their competitive capabilities, motivating and rewarding them and instilling discipline to get things done.

Executing strategy tests management’s ability to direct organisational change, achieve continuous improvement in operations and business processes, create and nurture a strategy supportive culture and consistently meet or beat performance targets.

What makes executing strategy tougher and more time consuming is the wide array of managerial activities that have to be attended to. They include the demanding people management skills required, the resistance to change and difficulties of integrating the efforts of many different work groups into a smoothly functioning whole.

Implementing the strategy

Just because top management and the board have announced a new strategy doesn’t mean that organisation’s staff will agree with it, or enthusiastically move forward to implement it. The management cannot simply tell their immediate subordinates to undertake new strategic initiatives and expect the needed actions and changes to occur rapidly.

Sceptical managers and employees may see the strategy as contrary to the organisation’s best interests or as a threat to their departments or careers.

Moreover, individual employees may have different ideas about internal changes that need to be made. Attitudes, vested interests, inertia and ingrained organisational practices do not melt away when management and the board decides on a new strategy and commence implementation efforts. This is especially so when only comparatively few people have been involved in crafting the strategy and when the rationale for the strategic change has to be sold to enough organisational members to obtain a buy-in.

It takes a deft managerial leadership to convincingly communicate the new strategy and the reasons for it, overcome pockets of doubt and disagreements and build consensus on all the hows of implementation and execution. This is in addition to securing the commitment and energetic cooperation of all units and get all the pieces in place and working in harmony. Depending on how much consensus building and organisational change is required, the process of implementing strategy can take several years.

Like crafting strategy, executing it is a task that involves the whole management team, not just top management. While the CEO and his team of heads of major units (business divisions, functional departments and key operating units) are ultimately responsible for successful strategy execution, the process typically involves every part and arm of the firm from the biggest operating unit to the smallest frontline work group.

Top managers have to rely on the active support and cooperation of middle and lower level managers to push strategic changes into functional areas and operating units and to see that the organisation operates in accordance with the strategy on a daily basis. Middle and lower level managers are not only responsible for initiating and supervising the execution process in their area of authority, but also instrumental in getting subordinates to continuously improve.

Preparing for the change

While a company’s strategy execution approach always depends on the organisation’s situation, certain managerial tasks have to be done no matter the circumstances. The first task is building an organisation with the competences, capabilities and resource strengths to execute the strategy successfully. This involves staffing the organisation with the right people and developing a set of abilities that will enable good strategy execution. Additionally, staff should be updated as strategy and external conditions change.

The second important task is marshalling resources for good strategy execution and operational excellence. Many strategic plans developed in the country, particularly in the public sector, are never successfully implemented because the principle shareholder does not provide the needed funds.

Third, institute policies and procedures that facilitate strategy execution. Changes in strategy generally call for some changes in work practices and operations. Asking people to alter established procedures always upsets the internal order of things. New policies and operating procedures developed to facilitate strategy execution provide top-down guidance regarding how things need to be done, helping to enforce consistency on performance of critical activities and promote the creation of a conducive work climate.

The fourth component is adopting best practices and striving for continuous improvement on performance of value chain activities. It is a waste of time to attempt to implement a new strategic plan without the organisation adopting total quality management (TQM) practices, six sigma quality control, business process engineering and bench marking these with industry norms.

Fifth, install information and operating systems that enable company personnel to carry out their strategic roles proficiently. Such systems include enterprise resource planning (REP), balanced scorecard software and human resource management information systems.

The sixth component is tying rewards and incentives to the achievement of strategic and financial targets and to good strategy execution. The organisation should not tie rewards and incentives to the number of years employees have clocked as this practice is not performance driven but patronage driven.

Shaping the work environment and corporate culture to fit the strategy is the second last component of the strategy execution process. Corporate culture refers to the character of a company’s internal work climate and personality- as shaped by its core values, beliefs, business principals, tradition, ingrained behaviours and style of working.

Lastly, management must exert the internal leadership needed to drive strategy implementation forward. There are times when leading the strategy execution process entails being authoritative and hardnosed. At times, one needs to be a perceptive listener and a compromising decision maker. There are times when matters are best delegated to people closest to the scene of action and sometimes, being a coach is the proper role. Many occasions call for managers to assume a highly visible role and put long hours guiding the process of strategy execution, while others entail only a brief ceremonial performance with the details delegated to subordinates.

Learn from difficulties

Larry Bossidy and Ram Charan once said that strategies often fail because they aren’t executed well. This implies that poor implementation is the main reason for strategy failure no matter how competitively sound it was thought out and developed. Vince Lombardi also reminds us that the best game plan in the world never blocked or tackled anybody. Lombardi is simply teasingly cheering us and saying that the best strategic plan in the world is that which was never implemented. This gives those who do not execute strategy an excuse on the basis that doing so would challenge the status quo and time for change was not right!

If you are a manager, execute the strategy and learn from the difficulties encountered. Your competitors are busy creating business opportunities and implementing growth strategies no matter the challenges.

Email: franciisfondo@live.com

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