5 Keys to Successful Strategy Execution - HBS Online

Strategy execution is the implementation of a strategic plan in an effort to reach organizational goals. It comprises the daily structures, ... …→ HarvardBusinessSchool→ HBSOnline→ BusinessInsights→ BusinessInsights HarvardBusinessSchoolOnline'sBusinessInsightsBlogprovidesthecareerinsightsyouneedtoachieveyourgoalsandgainconfidenceinyourbusinessskills.   FilterResults ArrowDown ArrowUp Topics Topics Accounting Analytics BusinessEssentials BusinessinSociety CareerDevelopment Communication Community ConneXt Decision-Making EarningYourMBA Entrepreneurship&Innovation Finance Leadership Management Marketing Negotiation News&Events Productivity StaffSpotlight Strategy StudentProfiles Technology Work-LifeBalance Courses Courses AlternativeInvestments BusinessAnalytics BusinessStrategy CORe DesignThinkingandInnovation DisruptiveStrategy EconomicsforManagers EntrepreneurshipEssentials FinancialAccounting GlobalBusiness LeadershipPrinciples LeadingwithFinance ManagementEssentials NegotiationMastery OrganizationalLeadership PowerandInfluenceforPositiveImpact StrategyExecution SustainableBusinessStrategy SustainableInvesting SubscribetotheBlog RSSfeed Filters Topics Topics Accounting Analytics BusinessEssentials BusinessinSociety CareerDevelopment Communication Community ConneXt Decision-Making EarningYourMBA Entrepreneurship&Innovation Finance Leadership Management Marketing Negotiation News&Events Productivity StaffSpotlight Strategy StudentProfiles Technology Work-LifeBalance Courses Courses AlternativeInvestments BusinessAnalytics BusinessStrategy CORe DesignThinkingandInnovation DisruptiveStrategy EconomicsforManagers EntrepreneurshipEssentials FinancialAccounting GlobalBusiness LeadershipPrinciples LeadingwithFinance ManagementEssentials NegotiationMastery OrganizationalLeadership PowerandInfluenceforPositiveImpact StrategyExecution SustainableBusinessStrategy SustainableInvesting SubscribetotheBlog RSSfeed 5KeystoSuccessfulStrategyExecution 17Nov2020 CatherineCote Author Staff tag Strategy StrategyExecution You’vesetorganizationalgoalsandformulatedastrategicplan.Now,howdoyouensureitgetsdone? Strategyexecutionistheimplementationofastrategicplaninanefforttoreachorganizationalgoals.Itcomprisesthedailystructures,systems,andoperationalgoalsthatsetyourteamupforsuccess. Eventhebeststrategicplanscanfallflatwithouttherightexecution.Infact,90percent ofbusinessesfailtoreachtheirstrategicgoals,whichresearchersbelieveisduetoagapbetweenstrategicplanningandexecution. “Ifyou’velookedatthenewslately,you’veprobablyseenstoriesofbusinesseswithgreatstrategiesthathavefailed,”saysHarvardBusinessSchoolProfessorRobertSimons,whoteachestheonlinecourseStrategyExecution.“Ineachcase,wefindabusinessstrategythatwaswellformulatedbutpoorlyexecuted.” Howcanyouequipyourselfandyourteamtoimplementtheplansyou’vecrafted?Herearefivekeystosuccessfulstrategyexecutionyoucanuseatyourorganization. FreeE-Book:HowtoFormulateaSuccessfulBusinessStrategy Accessyourfreee-booktoday. DOWNLOADNOW KeystoSuccessfulStrategyExecution 1.CommittoaStrategicPlan Beforedivingintoexecution,it’simportanttoensurealldecision-makersandstakeholdersagreeonthestrategicplan. ResearchintheHarvardBusinessReview showsthat71percentofemployeesincompanieswithweakexecutionbelievestrategicdecisionsaresecond-guessed,asopposedto45percentofemployeesfromcompanieswithstrongexecution. Committingtoastrategicplanbeforebeginningimplementationensuresalldecision-makersandtheirteamsarealignedonthesamegoals.Thiscreatesasharedunderstandingofthelargerstrategicplanthroughouttheorganization. Strategiesaren’tstagnant—theyshouldevolvewithnewchallengesandopportunities.Communicationiscriticaltoensuringyouandyourcolleaguesstartonthesamepageandstayalignedastimegoeson. 2.AlignJobstoStrategy Onebarriermanycompaniesfaceinstrategyexecutionisthatemployees’rolesaren’tdesignedwithstrategyinmind. Thiscanoccurwhenemployeesarehiredbeforeastrategyisformulated,orwhenrolesareestablishedtoalignwithaformercompanystrategy. InStrategyExecution,Simonspositsthatjobsareoptimizedforhighperformancewhentheylineupwithanorganizationalstrategy.HecreatedtheJobDesignOptimizationTool(JDOT)thatindividualscanusetoassesswhethertheirorganization'sjobsaredesignedforsuccessfulstrategyexecution. TheJDOTassessesajob’sdesignbasedonfourfactors,or“spans”:control,accountability,influence,andsupport. “Eachspancanbeadjustedsothatit’snarroworwideorsomewhereinbetween,”SimonswritesintheHarvardBusinessReview.“Ithinkoftheadjustmentsasbeingmadeonsliders,likethosefoundonmusicamplifiers.Ifyougetthesettingsright,youcandesignajobinwhichatalentedindividualcansuccessfullyexecuteyourcompany’sstrategy.Butifyougetthesettingswrong,itwillbedifficultforanyemployeetobeeffective.” 3.CommunicateClearlytoEmpowerEmployees Whenitcomestostrategyexecution,thepowerofclearcommunicationcan’tbeoverlooked.Giventhatastaggering95percentofemployeesdon’tunderstandorareunawareoftheircompany’sstrategy,communicationisaskillworthimproving. Strategyexecutiondependsoneachmemberofyourorganization'sdailytasksanddecisions,soit’svitaltoensureeveryoneunderstandsnotonlythecompany'sbroaderstrategicgoals,buthowtheirindividualresponsibilitiesmakeachievingthempossible. DataoutlinedintheHarvardBusinessReviewshowsthat61percentofstaffatstrong-executioncompaniesbelievefieldandlineemployeesaregiventheinformationnecessarytounderstandthebottom-lineimpactoftheirworkanddecisions.Inweak-executionorganizations,just28percentbelievethistobetrue. Toboostyourorganization’sperformanceandempoweryouremployees,trainmanagerstocommunicatetheimpactoftheirteam'sdailywork,addresstheorganizationinanall-staffmeeting,andfosteraculturethatcelebratesmilestonesonthewaytoreachinglargestrategicgoals. 4.MeasureandMonitorPerformance Strategyexecutionreliesoncontinuallyassessingprogresstowardgoals.Forthistobepossible,keyperformanceindicators(KPIs)shouldbedeterminedduringthestrategicplanningstage,andsuccessshouldbedefinednumerically. Anumericgoalallowsyouandyourteamtoregularlytrackandmonitorperformanceandassessifanychangesneedtobemadebasedonthatprogress. Forinstance,yourcompany’sstrategicgoalcouldbetoincreaseitscustomerretentionrateby30percentby2022.Bykeepingarecordofthechangeincustomerretentionrateonaweeklyormonthlybasis,youcanobservedatatrendsovertime. Ifrecordsshowthatyourcustomerretentionrateisdecreasingmonthovermonth,itcouldsignalthatyourstrategicplanrequirespivotingbecauseit’snotdrivingthechangeyoudesire.If,however,yourdatashowssteadymonth-over-monthgrowth,youcanusethattrendtoreasonablypredictwhetheryou’llreachyourgoalofa30percentincreaseby2022. 5.BalanceInnovationandControl Whileinnovationisanessentialdrivingforceforcompanygrowth,don’tletitderailtheexecutionofyourstrategy. Toleverageinnovationandmaintaincontroloveryourcurrentstrategyimplementation,developaprocesstoevaluatechallenges,barriers,andopportunitiesthatarise.Whomakesdecisionsthatmaypivotyourstrategy’sfocus?Whatpiecesofthestrategyarenon-negotiable?Answeringquestionsliketheseupfrontcanallowforclarityduringexecution. Also,rememberthatastagnantorganizationhasnoroomforgrowth.Encourageemployeestobrainstorm,experiment,andtakecalculatedriskswithstrategicgoalsinmind. Related:23ResourcesforMobilizingInnovationinYourOrganization DevelopingYourStrategicToolkit Settingstrategicgoals,formulatingaplan,andexecutingastrategyeachrequireadifferentsetofskillsandcomewiththeirownchallenges.Keepinginmindthateventhebestformulatedstrategycanbepoorlyexecuted,considerbolsteringyourexecutionskillsbeforesettingstrategicgoalsandputtingaplaninplace. Areyouinterestedindesigningsystemsandstructurestomeetyourorganization’sstrategicgoals?Exploreoureight-weekStrategyExecutioncourseandotheronlinestrategycoursestohoneyourstrategicplanningandexecutionskills.TofindtherightHBSOnlineStrategycourseforyou,downloadthefreeflowchart. AbouttheAuthorCatherineCoteisamarketingcoordinatoratHarvardBusinessSchoolOnline.PriortojoiningHBSOnline,sheworkedatanearly-stageSaaSstartupwhereshefoundherpassionforwritingcontent,andatadigitalconsultingagency,whereshespecializedinSEO.CatherineholdsaB.A.fromHolyCross,whereshestudiedpsychology,education,andMandarinChinese.Whennotatwork,youcanfindherhiking,performingorwatchingtheatre,orhuntingforthebestburgerinBoston.