I once worked with an organization on its strategic plan. Afterwards, one manager noted that there was a huge collective exhale of relief and satisfaction as it was completed.
“As if we were done,” he said.
In truth, his team realized it was time to take a deep breath and focus on their next task – implementation.
“The tough work was just beginning.”
Companies typically realize only about 60 percent of their strategies’ potential because of defects in planning and execution, said Michael C. Mankins and Richard Steele in their article “Turning Great Strategy into Great Performance.”
The most common reasons: Lack of resources and poor communication.
As this newsletter was being planned, it made sense to turn to some Wunderlin Company clients with recent experience developing visions, values and strategies – and then following through. Because strategic plans are highly privileged information, no names are used – but we thank them all the people interviewed for their contributions to making this newsletter relevant.
Those interviews yielded six best practices.
1. Design your strategic planning process with the intent for execution.
In their book: Execution: The Discipline of Getting Things Done, authors Larry Bossidy and Ram Charan note that “an astonishing number of strategies fail because leaders don’t make a realistic assessment of whether the organization can execute the plan.”
Management has to ask itself tough questions and have the courage to answer them realistically: Do we have the organizational capability to execute the plan—and the right people in place? What do we need to do in the near- and medium-term to make the plan work in the long run? Can we adapt the plan to rapid changes in the business environment?
Here are some further insights from our clients’ experiences:
“We wanted to make sure we could implement our strategic plan so we designed the process with that in mind,” said another manager. “We were in a time of transition in leadership … and our strategic plan actually helped attract our new CEO to the organization. He had never seen a plan quite like it and so he bought into the plan before he arrived at his new job.”
“Once we were well into the process of strategic planning we realized… that we simply did not have the level of skills and systems in place to execute our strategies,” another client said. “The first year or so we spent correcting weaknesses, rather than exploiting strengths. We focused our efforts on rebuilding the company in a more robust fashion. Now we are positioned for growth and strength. This recognition of weaknesses would never have surfaced if we had not gone through a strategic planning process.”
2. Leadership is critical to follow-through
“An organization’s leadership must buy into the strategic process and the outcome of the plan,” said one client. Senior leadership has the line of sight – the vision – to see into the future while keeping the whole organization in its peripheral view.
It is the job of those managers to juggle the challenge of allocating scarce resources to both the strategic and operational needs of the business.
Bossidy and Charan put it this way: “You’ve got to link your strategic plans specifics to your operating plan, so that the moving multiple parts of the organization are aligned to get you where you want to go.”
Here’s what another one of our clients had to say about the role of leadership: “You have to have leaders who can see across the organization. You can’t implement strategy in functional silos. Strategy, by its very nature, causes groups and coalitions of people to come together and think about improvement beyond what we can do on our own.”
3. Translate plans into manageable “bites”
A Harvard Business Review article entitled Action Plans: The Architecture of Implementation, noted that leaders must be skilled at turning strategic plans into action plans executed at the unit level. They set forth five tips for crafting action plans:
- Keep it simple. An overly complex plan will confuse and frustrate.
- Involve the people who will execute the plan. Implementation plans are more likely to succeed if they are not simply imposed on the people asked to push them forward.
- Structure your action plan in achievable chunks. Build an action plan that is both manageable and achievable.
- Specify roles and responsibilities. Every planned outcome should be the acknowledged responsibility of one or more individuals. Those individuals should publicly state that they accept their roles.
- Make it flexible. A good implementation plan is a living document open to revision.
4. Weave strategic thinking into day-to-day operations
You have to continually assess your progress in “moving the ball down the field“ in terms of the strategic plan – while you balance day-to-day work and unplanned things that happen, said one client.
One company has made it a part of every day’s operation to focus on broadening its customer base – a key point in its plan.
“Our strategic plan helped us identify new markets and helped us see how vulnerable we were because our market focuses were so narrow.”
“Our values need to be reinforced in all we do,” said another leader. “That ranged from developing employee rewards tied to our values to stepping forward and acknowledging when one of our values has been breached.”
5. Measure progress
The late management guru Peter Drucker was known for saying: “If you can’t measure it, you can’t manage it.”
No truer statement can be made for improving your odds of success in implementing your strategic plan.
The type of measuring system is not as important as choosing one and using it rigorously.
A number of our clients have adopted a balanced scorecard approach to measuring progress. Some have found successful approaches that tie part of the existing management reporting into strategic plan measurement. Other clients have implemented a project management process that increases their ability to analyze opportunities and have higher levels of accountability.
All are designed around performance metrics that are both relevant and clear and feature both financial and nonfinancial performance measurements. All link their strategic plans to their annual business plans and budgets.
One of our clients recommended putting one person in charge of measuring progress: “Someone has to be the watchdog of the process.”
6. And finally: Communicate, communicate, and communicate some more.
All your strategic activities must be tied together so that employees understand the strategy and progress toward the goals.
Here’s how one of our clients explained this best practice: “People understand the strategy when you do something that changes their world. For example, once they could see and experience lean strategy, everyone in the building understood the strategy better. We would not have gotten the same result if we had shown a slide show on lean manufacturing. You have to bring the learning and the execution close together.”
Provide updates at all-employee meetings, track it in performance reviews, feature it in your newsletter and keep it front and center as you go about your day, week, month and year.
And if changes happen in the world or your field that affect the plan, it’s important to share that, says Holly Green, writing for Forbes. “Make the development of strategic agility in execution a priority for your organization”
Follow these six best practices and I promise: Results will follow.