Strategy to Win Element 10 -  Execution

 

Solutions to Things Going Wrong

In this session, we will be discussing the tenth and final element of strategy to win, focusing on execution. This element holds significant importance as it often presents the greatest challenge for executives. Many organizations face difficulties when it comes to making their plans work effectively.  While numerous books have been written on the topic of executing a plan successfully, we aim to provide insights into what to do when you encounter obstacles or when your plan is not yielding the desired results. Our approach will be simple and straightforward to help you navigate through these challenges.

 

Learning from Experience

Both of us, Kirk and Gary, have extensive experience in dealing with the problems that arise during execution. Through our collective years of experience, we have gained valuable knowledge that is difficult to find elsewhere. Our goal is to equip you with the necessary skills for executing strategies effectively, ensuring that your initiatives are completed on time, within budget, and delivering the expected returns.

 

The High Cost of Not Executing

The consequences of ineffective execution can be detrimental to organizations. To illustrate this point, let's consider the case of a large computer company, Intel. Intel recently replaced its CEO after a few years because they were not executing their plans successfully. They were unable to meet their objectives, falling behind schedule. Consequently, their share price suffered a significant decline of four percent over the year, while their competitors experienced gains of 87 and 99 percent. Failing to execute a plan has high costs, both in terms of financial performance and market position.

 

The Challenge of Successful Execution

The success rate of executing strategies is disappointingly low, averaging only around 50 percent. This statistic is unacceptable considering the effort put into strategizing. Unfortunately, some companies develop a culture of consistently missing their goals or objectives. These organizations often lack the knowledge or tools to address their problems effectively, leading to a pattern of failed initiatives. It is crucial to change this culture and develop a focus on successful execution.

 

Understanding the Reasons for Failure

After conducting numerous academic studies and observing thousands of failed strategy projects, it becomes essential to delve into why the success rate is so low. The simple answer is that successfully executing a good strategy is exceptionally challenging. However, this answer does not provide much gratification. Many things in life are difficult, yet we still manage to accomplish them. The key is to acknowledge that problems, hurdles, and unexpected challenges are inevitable. As a leader, your role is to find ways to overcome these obstacles and achieve success. Smooth roads are rare, and your ability to navigate through adversity defines your leadership.

 

Navigating through Challenges

To excel in execution, it is vital to recognize and understand the problems you may encounter. By gaining a comprehensive understanding of these challenges, you can develop effective strategies to overcome them. Inevitably, there will be problems, interruptions, and unforeseen circumstances that will test your ability to succeed. However, as a leader, your responsibility is to find ways to win despite the adversity.

 

Strategy Execution: Overcoming Common Challenges

The following is a list of common problems in executing strategies that have persisted over the past 30 years. We'll explore some of these key challenges and how a well-designed strategy can overcome them.

 

• Leadership is the Cornerstone of Strategy Execution

One of the primary reasons for failure in strategy execution is a lack of effective leadership. It requires competent leadership, to navigate the complexities of strategy implementation. Developing the necessary leadership capabilities is essential to successfully execute a strategy.

 

• Unclear and Insufficient Communication

The second challenge discussed is unclear and insufficient communication. Throughout this course, the importance of communication and alignment is emphasized. By providing clear guidelines and promoting effective communication channels, organizations can ensure that their team members understand their roles and responsibilities. Lack of clarity in communication often leads to misunderstandings and reluctance to perform assigned tasks. Thus, fostering open and transparent communication is crucial for strategy execution.

 

• Insufficient or Inadequate Resources

Another critical challenge in strategy execution is insufficient or inadequate resources. Proper resource planning is emphasized as an essential element in the strategy execution process. Companies must assess their capabilities and ensure they have the necessary resources to tackle the initiatives outlined in their strategy. For example, attempting mergers and acquisitions without building the required capabilities within the company can lead to failure. It is vital to align the strategy with the organization's capabilities to ensure successful execution.

 

• Lack of Clear Strategy

The absence of a clear strategy is a challenge that often affects middle management. Inconsistent strategic objectives can create a sense of being "jerked around" among employees. By having a well-defined and consistent strategy, organizations can provide a clear direction for their teams. The analogy of political campaigns was used to illustrate this point. Candidates with a clear and consistent message are more likely to gain voter support compared to those who frequently change their message. In the same way, having a clear vision for the next three years through a well-crafted strategy helps align the organization and avoid confusion.

 

• Ambiguous Responsibilities

Ambiguous responsibilities often hinder strategy execution. Establishing clear ownership and accountability for strategic priorities and tactical initiatives is crucial. By assigning specific individuals to each priority and initiative, organizations can ensure clear expectations and accountability. When responsibilities are ambiguous, failures become difficult to identify and address. Clarity in ownership helps to streamline execution and holds individuals accountable for achieving their assigned tasks.

 

These are just a few examples of the challenges organizations face when executing their strategies. 

 

Common Challenges in Strategy Execution

In the realm of business strategy, effective execution is crucial for achieving success. However, many organizations encounter various challenges that hinder their ability to execute strategies efficiently. Here are some of the common obstacles faced during strategy execution and how to overcome them.

 

• Lack of Performance Information

One of the primary challenges that organizations face is the absence of comprehensive performance information. Without a clear understanding of how the business is performing, it becomes challenging to stay on track and make informed decisions. To address this issue, it is essential to establish a robust reporting system, such as a weekly dashboard, that provides critical metrics and allows stakeholders to monitor progress regularly.

 

• Resistance to Change

Another significant hurdle is resistance to change. When implementing new strategies, some team members may be reluctant to embrace the necessary changes. To overcome resistance, it is vital to create a culture that values open communication and encourages constructive feedback. Addressing concerns and involving dissenting voices in the decision-making process can help foster engagement and broaden perspectives. However, if someone consistently disagrees with the strategic direction, it may be necessary to reassess their fit within the team.

 

• Insufficient Management Capabilities

Insufficient management capabilities can impede strategy execution. Effective resource planning is crucial for aligning organizational goals with available resources. By ensuring that the right people are in the right roles and providing them with the necessary support, organizations can enhance their execution capabilities. This requires a proactive approach to identifying and addressing any gaps in management skills and expertise.

 

• Delayed Plans and Overwhelm

Delays in executing plans and feeling overwhelmed by day-to-day responsibilities are common challenges faced during strategy execution. Organizations often find themselves caught up in the whirlwind of daily operations, leaving little time and energy for strategic initiatives. To overcome this challenge, it is essential to establish clear priorities and allocate resources accordingly. Regular problem-solving sessions, such as weekly problem-solving meetings, can help address issues promptly and prevent them from derailing progress.

 

The Weekly Strategy Execution Cycle

After addressing the key elements discussed above, businesses can establish a weekly strategy execution cycle. This cycle encompasses elements one through seven, focusing on performance information, change management, management capabilities, and day-to-day responsibilities. By incorporating these elements into their daily or weekly activities, organizations can enhance their execution strategies and achieve their desired outcomes. The weekly strategy execution cycle serves as a visual representation of the alignment between strategic objectives and tactical initiatives.

 

Successful business execution requires careful attention to various elements. By prioritizing performance information, embracing change, improving management capabilities, and managing day-to-day responsibilities, businesses can enhance their execution strategies and drive meaningful results. It is essential to establish a culture that values clear communication, collaboration, and strategic alignment to ensure efficient execution of plans and continuous growth.

 

Implementing Effective Execution Strategies

To implement effective execution strategies, businesses should consider the following steps:

 

Step 1: Establish Clear Goals and Objectives

Before embarking on any execution plan, it is crucial to define clear goals and objectives. These should align with the organization's overall vision and mission. By clearly articulating what needs to be achieved, businesses can set a solid foundation for execution.

 

Step 2: Develop Key Performance Indicators (KPIs)

To monitor progress and measure success, organizations need to develop key performance indicators (KPIs). These indicators should be specific, measurable, attainable, relevant, and time-bound. By regularly tracking KPIs, businesses can evaluate their performance and make data-driven decisions.

 

Step 3: Establish Communication Channels

Effective communication is vital for successful execution. Establishing open and transparent communication channels allows for the dissemination of information, updates, and feedback. It ensures that everyone is on the same page and understands their roles and responsibilities.

 

Step 4: Foster a Culture of Accountability

Accountability is crucial for execution. Every individual within the organization should be accountable for their actions and commitments. By fostering a culture of accountability, businesses create an environment where everyone takes ownership of their tasks and strives for excellence.

 

Step 5: Provide Adequate Resources

Resource allocation is a critical aspect of execution. Businesses must ensure that the necessary resources, including finances, personnel, and tools, are available to support the execution process. Insufficient resources can impede progress and hinder successful execution.

 

Step 6: Continuously Monitor and Evaluate Progress

Regular monitoring and evaluation are essential to track progress and identify any deviations from the plan. By conducting periodic reviews, businesses can identify areas that require improvement and make necessary adjustments to stay on track.

 

Step 7: Foster a Culture of Adaptability

The business landscape is constantly evolving, and adaptability is key to successful execution. Organizations should encourage a culture of adaptability, where individuals are open to change, embrace innovation, and are willing to adjust their strategies as needed.

 

Step 8: Celebrate Milestones and Successes

Acknowledging milestones and successes along the execution journey is essential for motivation and morale. Celebrating achievements boosts team spirit and encourages continued dedication to the execution plan.

 

By following these steps and incorporating the key elements discussed earlier, businesses can enhance their execution strategies and increase the likelihood of achieving their desired outcomes. Successful execution requires a combination of strategic planning, effective communication, resource management, and adaptability. By prioritizing these elements and fostering a culture of execution excellence, organizations can drive sustainable growth and success.

 

Driving Successful Business Execution

Successful business execution is the result of careful planning, effective communication, and continuous adaptation. By addressing key elements such as performance information, change management, management capabilities, and day-to-day responsibilities, organizations can overcome execution challenges and achieve their strategic objectives.

 

To drive successful execution, businesses should prioritize the establishment of clear goals and objectives, develop measurable KPIs, and foster a culture of accountability. Adequate resource planning, including human and financial resources, is crucial for effective execution. Regular monitoring and evaluation help identify areas for improvement and ensure alignment with the established goals.

 

Organizations must embrace change and encourage open communication to address resistance to change effectively. By valuing diverse perspectives and engaging stakeholders throughout the decision-making process, businesses can build a cohesive team focused on achieving common goals.

 

Managing day-to-day responsibilities alongside strategic initiatives requires effective resource allocation and prioritization. By striking a balance between the whirlwind of daily operations and long-term goals, businesses can ensure that strategic execution remains a priority.

 

The Execution Process

To achieve success, organizations need to follow a well-defined execution process. It begins with detailed planning during the initiative phase, followed by the actual execution of the plan. Throughout this process, frequent measurement of progress is essential. If the team remains on track, they can continue with the execution. However, if any deviations occur, immediate problem-solving is required. Weekly problem-solving meetings help identify countermeasures that can mitigate issues and facilitate a swift return to execution.

 

Problem-Solving Methodologies

Business leaders often rely on their initiative owners to identify problems and provide solutions. However, the initial answer that comes to mind may not necessarily address the root cause of the problem. It is essential to differentiate between symptoms and underlying causes. The symptoms are easily identifiable, but the causes are often more complex and require deeper analysis. Simply addressing the symptoms without understanding the underlying causes is akin to "chopping at the leaves" rather than digging out the roots of the problem.

 

Theory of Constraints

Addressing complex problems requires effective problem-solving methodologies. One such methodology is the theory of constraints, popularized by Eli Goldratt in his book "The Goal." The theory of constraints focuses on identifying the most significant barriers to achieving results. By pinpointing the main obstacles, businesses can prioritize their efforts and eliminate these constraints one by one. This approach encourages a comprehensive understanding of the factors impeding progress and fosters a proactive problem-solving mindset.

 

Root Cause Analysis and the Fishbone Diagram

A valuable tool in problem-solving is root cause analysis, which helps uncover the primary causal drivers of a problem. Utilizing the fishbone diagram, also known as the Ishikawa diagram, is an effective way to conduct root cause analysis. This method involves exploring various factors related to materials, methods or processes, measurements, machines, environment, and personnel. By delving into these areas, teams can identify potential causes and gain a broader perspective on the issue at hand. Root cause analysis is commonly used in manufacturing and factory environments but can be applied to various tactical initiatives.

 

The Five Whys: Uncovering Root Causes

In problem-solving, it's crucial to identify the root cause of an issue to implement effective solutions. One technique that aids in this process is the "Five Whys." By repeatedly asking "why" in a chain of events, we can delve deeper into the problem's underlying causes. In this section, we'll explore the concept of the Five Whys and its importance in finding the true source of an issue.

 

Understanding the Five Whys

The Five Whys is a method of inquiry that involves asking "why" at least five times to uncover the root cause of a problem. Each time we ask the question, we move closer to the source of the issue, away from its symptoms. While it's possible to identify the root cause in fewer than five steps, it's generally effective to reach the underlying problem within this range. Although initially uncomfortable, practicing the Five Whys can facilitate collaboration among coworkers and foster a deeper understanding of recurring issues.

 

The Consequences of Misdiagnosing Problems

Misdiagnosing a problem can lead to solving its symptoms instead of addressing the root cause. While treating symptoms may temporarily resolve the issue, the underlying problem persists and may manifest in different ways. This phenomenon is often referred to as "moving a problem downstream." In some cases, the subsequent problem can be more severe than the initial issue, which usually makes the situation worse.

 

Applying the Five Whys: A Manufacturing Example

Let's examine a practical example of how the Five Whys can be used in a manufacturing environment. Suppose an electric motor suddenly stops working, which becomes a topic of discussion during a weekly tactical initiative review meeting. By applying the Five Whys, we can trace the issue back to its root cause:

 

1. Why did the electric motor stop working?

   - The motor powering the mixer won't run.

2. Why did the fuse break?

   - The motor drew too much current.

3. Why did the motor draw so much current?

   - The motor was overloaded.

4. Why was the motor overloaded?

   - The material being mixed exceeded the motor's design limit.

   

Through this iterative questioning process, we arrive at the root cause of the problem. Now, armed with this information, we can devise appropriate countermeasures to address the issue effectively.

 

The Importance of Identifying the Root Cause

It's crucial to determine whether we have reached the root cause of a problem. If we mistakenly address a symptom instead, the problem will persist, possibly manifesting elsewhere. To avoid this, we must strive to identify the true underlying cause. In the manufacturing example, merely replacing fuses without addressing the motor overload issue would lead to an ongoing problem. To achieve a long-term solution, we need to focus on countermeasures that directly target the root cause.

 

Implementing Effective Countermeasures

Once the root cause is identified, we can begin implementing countermeasures to resolve the problem. The key is to take immediate action that will make a tangible impact. Ideally, we want to solve the problem today. The designated initiative owner needs to possess the necessary responsibility, authority, and resources to execute the countermeasures effectively. Without these elements, the burden of finding a solution may continually fall on senior executives, causing fatigue and hindering progress.

 

Avoid Symptoms, Find the Root Cause

The Five Whys technique provides a valuable framework for uncovering the root causes of problems. By persistently asking "why," we can gradually unearth the underlying issues and implement targeted solutions. Avoiding the trap of solving symptoms instead of addressing the root cause is crucial for long-term success. By understanding the importance of the Five Whys and effectively executing countermeasures, organizations can overcome challenges and improve their problem-solving capabilities.

 

The Power of Asking Good Questions

Leaders become more productive and influential by learning how to ask the right questions. The right questions will lead to innovative solutions that move operations forward.

 

The Most Powerful Question: "I Don't Know, What Do You Think?"

One of the most helpful and empowering questions a leader can ask is: "I don't know, what do you think?" This question catalyzes problem-solving. When confronted with a problem, posing this question to oneself or others can initiate a productive dialogue and lead to innovative solutions.

 

Teaching Team Members to Bring Solutions, Not Just Problems

By asking this question, leaders can teach team members to bring solutions, not just problems to the conversation. When individuals bring proposed solutions along with the problems they encounter, it empowers decision-makers to take immediate action. While revisiting brainstorming sessions may be necessary at times, the weekly meeting serves as a critical platform to discuss and identify actionable solutions.

 

The Role of the Weekly Meeting and Initiative Leaders

We recommend conducting a weekly meeting to review progress and discuss challenges. The responsibility for leading this meeting should lie with the initiative leader, who should identify key performance indicators (KPIs) and accomplishments or propose corrective actions if off track. As a leader, your role is to guide, direct, and approve while assisting whenever possible.