It happens all the time: an organization’s executives hole up in a conference room or retreat center with mind-mapping tools and flip charts. Or they hire a big strategy firm for fresh, expert ideas. And out of that investment comes a ‘blue ocean’ strategy expressed in high-level statements. The idea could be one of any number of changes that significantly impact the organization’s people, processes, or technologies: a new or radically revised go-to-market offering, a plan to realign the company’s supply chain, a merger or acquisition, an organizational structure realignment. These ideas almost always resonate with boards and shareholders – a vision is inherently a wonderful, pie-in-the-sky idea.
A key component of a viable strategy is a fundamental understanding of marketplace drivers. These dynamics – growth rate, forecasted demand, competition and potential barriers, and more – should be included in planning and monitored during implementation. But the most important consideration is the alignment of the new strategy across the entire organization. This is where many organizations miss the mark and doom a great idea to failure.
Operationalizing a strategy in a changing marketplace can be daunting
When a new strategy is announced it is often met internally with enthusiasm – closely followed by the realization that its implementation and operationalization will only increase workloads. A thoroughly developed internal launch announcement includes at least high-level information about how it will impact the allocations and prioritizations of the organization’s existing operational frameworks. Taking the time to build in the idea will improve buy-in and confidence, and therefore the potential for success.
In our work with a wide variety of organizations, we have observed that the following five factors consistently increase the likelihood of success:
1: Articulate the strategy
Be very clear about what you are trying to achieve. Communicate the strategy in the language of the target stakeholder: governing boards need to hear the expected outcomes, while partners are looking for mutual value and employees need to hear actionable goals. Strategy, by its very nature, is broad, and for it to be successful, clear and meaningful objectives and measurements need to be assigned, owned, and managed effectively.
Consider applying the Objectives and Key Results (OKR) framework, which connects actions with key results that lead to an ultimate objective. OKR guides teams to define measurable initiatives made up of plans and activities that will lead to achievement of the objective.
2: Validate the strategy
There’s nothing worse that identifying a strategy and realizing it can’t be implemented – so make the determination early to avoid waste and embarrassment. Use data to verify key assumptions on which the strategy is based, and identify (or establish, if needed) baseline metrics along with key performance indicators to measure progress. Break KPIs into sets of team-owned goals. Monitor both OKR and KPI metrics throughout the design and implementation process to assess the team’s effectiveness and progress toward its goals, and determine when to adjust to remain on course.
3: Communicate the strategy
Powerfully communicate the essence of your strategy at every level of the organization. Every vehicle, from intranets to departmental meetings to individual performance plans, must acknowledge and reflect the strategy. Leaders must be the catalysts for cascading information; each functional or department leader must identify connection points that their teams will own. Accountability is critical. Identify and communicate who the decision makers are to streamline progress and avoid wasted time.
[epq-quote align=”align-center”]Clear alignment across the organization is the energy that unites all team members and unleashes the discretionary effort that drives goal achievement.[/epq-quote]
4: Execute the strategy
If strategy is the Why, then Execution is the Who, What and How. A key element of a new strategy is determining a management structure that will shepherd the shift from present to future state. And an important – and often overlooked – step is assessing the organization’s capabilities to service the new strategy. Understand and manage the resource load through each phase, with a careful eye on operationalizing the new normal. Tasking teams that are already stretched thin increases risk. Instead, identify a strategic partner to support the execution planning and implementation. This can both lower risk and provide an undivided focus on achieving the strategic vision.
5: Link performance to strategy
Organizations that succeed in making big ideas happen are those that weave strategy implementation into their everyday existence. Some companies invest in performance management system software that has these links built into its human capital processes, and others deploy a balanced scorecard. But even if performance reviews are verbal and written, you can still award credit to teams who have embraced their roles in strategy execution and can clearly demonstrate how they’ve contributed. Nothing shows people how important their alignment to strategy is than when it impacts their reviews and potentially their remuneration.
[epq-quote align=”align-center”]“I’d rather have a first-rate execution and second-rate strategy any time than a brilliant idea and mediocre management.” – Jamie Dimon, chair and CEO, JP Morgan Chase[/epq-quote]