Poor strategy execution is not exclusively a CEO headache. All entrepreneurs face, at least once, the disparity between strategy and performance to feel its consequences: waste of time, energy, and money. Is a plan falling short of expectations an inevitability? We don't think so. We will share 7 proven steps for your strategy to cross the chasm in safety and get results.
Strategic planning and execution are two faces of the same coin: results. In other words, a successful strategy depends on stellar implementation. And vice-versa. However, most companies report a disparity between real performance and projected one. The result? Waste of money and resources. But also opportunities: companies discard profitable revenue streams by keeping poor strategies in their portfolios rather than searching for better options.
The top factors contributing to the strategic execution gap are poorly designed plans, badly allocated resources, and breaks in communications. Successful companies devise ways to prevent these culprits from hindering their strategic plans. How? These companies develop realistic plans firmly rooted in the economy underlying their markets. Then use it to drive the execution phase. This approach makes them less prone to face a performance deficit and react when detours happen.
We have good news: you can create resilient plans too by following 7 steps to assess the feasibility of the strategy and its implementation. Let's get started.
1. Be simple
The worst enemy of a strategy is vagueness. Not being able to tell what your company aims and how it will achieve them hinders a clear vision for your team and jeopardizes the execution strategy.
Describing clearly what your strategy will do and, not least important, will not put everyone in an organization looking in the same direction. Plus, simplicity help to avoid misunderstandings and improve action planning and accountability.
Pro-tip: finding simplicity isn't easy. Try this to clear your mind: write down your business strategy in the simplest way possible. For example, my company will sell something to someone doing this and that because we discover this fact. Meanwhile, we will not do other things such as x, y, and z.
2. Defy assumptions
Guesswork harms your strategy. Doing work based on false assumptions will be terrible for your strategy performance. So, be sure the foundations of your strategic plan take into account the past performance of your company and the economic trends where your business operates.
Remember to gather information as detailed as possible about your market profitability as well as the offers, costs, and pricing of your competitors. You can find invaluable information in Crunchbase and industry reports. This data is vital to get an x-ray of the market and uncover gaps where you can fit new offers to satisfy a need. Collecting and analyzing facts leave you better informed to discuss and test your business assumptions. So, your plan turns more realistic.
Pro-tip: analyze the last couple of years' performance to take the pulse of your business. If you are launching a new company, look for your industry benchmarks to help you set ambitious but feasible goals.
3. Speak the same language
Briefing your team about the new strategy isn't enough. Your team should understand the 3 whats:
- What is the rational
- What are the core elements
- What are the criteria to evaluate the strategic execution
This step is much more relevant in a medium to a large organization. In these types of companies, the key message of your strategy may get lost between departments and teams. So, promoting a common understanding of the elements of the strategy improves the quality of the dialogue among team members and prevents silos.
Pro-tip: create a task force to clear up the meaning of your strategy elements and tactics.
4. Discuss early where to put resources
List the resources needed to carry on your strategy. It may be tools, professionals, or facilities. It is vital to know the effort required to get them. Besides money, the amount of time dedicated to each resource is another variable to take an eye on. To tackle this step correctly, you need to gauge the quality of your company's processes. Consider it your baseline to decide how to allocate resources for your new strategy.
Pro-tip: ask questions and pose scenarios to your teams. For example, how fast will the team achieve a specific goal with this new approach? Start with the easy questions and get more complicated. This exercise fosters an honest discussion around the usefulness and effectiveness of the resources in context.
5. Set priorities
To accomplish a successful strategy, you need to put in motion lots of tactics. However, not all tactics have the same importance. Only a few actions taken at the right time in the right way will be fundamental to reaching the desired results. The top priority actions should be those with a high impact on the performance.
Making strategic priorities explicit for all know in the organization help teams to focus and increase accountability by assigning key strategy moments to leaders.
Pro-tip: build a timeline with actions that will take place in the following months and register their respective KIPs. That way, you know what is happening and what is working. Plus, everyone knows what is happening because the information is transparent and shared
6. Monitoring the performance continuously
Continuous feedback is the watchword of this step. Following up on the results in real-time and comparing them with the plan helps you redefine the assumptions when needed, take efficient countermeasures, and relocate resources. This step also helps distinguish a planning flaw from an execution failure.
Pro-tip: reporting is a great way to keep up with your KPIs and evaluate the impact of your initiatives. Don't forget to set a periodicity and be consistent.
7. Reward the execution ability of your team
Nurturing and developing teams is a mandatory step. After all, are they that will materialize your vision and strategy. Talent is key. So, it's crucial to develop programs to harness your team's potential and define bonuses for specific milestones.
Getting new talent may be an option. Recruiting turns fundamental when the team that comes up with the strategy may not be the most suited to carry on. To not compromise the future of your strategy, you need to hire seasoned professionals. Alternatively, you can promote upskilling programs to empower in-house talent.
Pro-tip: if you or your company can not afford to hire seasoned professionals, evaluate if your plan is not too ambitious for your reality. Otherwise, advance for a partnership or a joint venture.
The strategy execution gap isn't a curse. There are ways to reduce the gap between strategy and performance by continuous improvement the quality of your decision-making. Let's recap the steps that will closer the gap and make your strategy a success: be simple; defy assumptions; speak the same language; discuss early where to put resources; set priorities; monitor the performance continuously, and reward the execution ability.