“As a former Head of Strategy for a major bank and as a Regional Strategist for The Boston Consulting Group, I have sat through many strategy presentations. Some strategies were brilliant. Some strategies were humdrum. But it made no difference – as most strategies were doomed to failure.”
Jed Simms, Totally Optimized Projects Founder
Every organization has a strategy.
Strategies define what your business does, the markets it is in and the initiatives/projects it undertakes. Even if you do not have a written-down, formally articulated strategy document, your business still has a strategy.
So strategy execution—how you turn your chosen strategies into reality in your business and deliver the future results—is relevant to every organization.
Strategy without execution has no value.
The value in a brilliant strategy can be destroyed by poor execution while an average strategy, executed far better than the competition, can pay off big-time.
Being excellent at execution can be a worthwhile strategy in itself.
Even the “right” strategy can fail.
When strategies don’t deliver the promised results, the strategy consultants tend to blame the clients: “They didn’t implement the strategies properly”.
In many cases this is true. However some strategies are beyond the clients’ capability to deliver—something often not considered when the strategy is being devised. While others just won’t work in practice or could never deliver the targeted results and therefore end up being discarded.
But even when the strategies are achievable and workable, most will still not be successfully implemented. Why?
“While strategy and change management are long standing concepts in most organizations, most organizations don’t do them well.”
“Most strategies tend to be little more than words on paper. To refocus the organization on actually executing against the strategy — rather than continuing to do business as usual — takes a conscious change effort, which most companies would be unable to do without either a framework or outside consulting help.”
Donna Fitzgerald, Research VP, Gartner Inc commenting on TOP for the Gartner “Cool Vendor” award.
The problem is—there is a gap between Strategy and Projects …
Between the strategy as defined and the project(s) which are supposed to deliver it, there is a gap.
To be more precise, there are a series of gaps or failings that foil effective strategy execution. Some of these gaps include:
- How the strategy’s outcomes and results are defined
- How the portfolio of projects is assessed to ensure its strategic relevance and contribution
- How the projects are prioritized
- How the strategy’s execution is managed to ensure the results are achieved in the business
- How the success of the portfolio of projects is measured
Key strategy and investment processes are missing…
None of these gaps reside in the project management processes—rather they are gaps and deficiencies in the strategy and value delivery processes that should be driving project and technical delivery. Processes such as strategy-based investment and portfolio management and value-based business planning and delivery—just to mention a few. Gaps and deficiencies in these and other processes undermine effective strategy execution. They also determine your organization’s level of strategy execution capability.
Organizations tend to misunderstand the significance of these missing processes. They believe that:
“If we define the projects to deliver the strategy and get the right people and manage them carefully, then the results will match the strategy and be delivered on time and on budget. (We hope!)”
Sorry but “hope”, “heroes” and “gurus” are not a viable long-term solution
Project Management is not the same as strategy execution. Nor are “hope” or “heroes” a substitute for an embedded strategy execution and value delivery capability founded on processes.
True, you need project management expertise to administer and manage the project activities, delivery processes and reporting, for example. But without the right strategic and business processes and capability, you are reliant on individual heroes and gurus to get a result. Without the strategic investment and portfolio processes plus the business value delivery processes, you will be delivering tactical solutions, not strategic results.
When you don’t have a good strategy execution process:
- Your execution results will be “hit & miss”. Sometimes you get there, more often not;
- The strategic intent of the strategy can be lost in its translation into projects;
- Projects which are not strategically relevant are pursued at the expense of those which are more important to your strategy;
- Tactically urgent projects are prioritized ahead of strategically important ones.
- The projects deliver results but which do not contribute to or align with the strategy.
Regardless of how well you define your strategy, in reality it is what you can successfully execute and deliver that determines your results and ongoing competitiveness.
Maximizing Business Value Through Effective Strategy Execution
There are only two paths to executing strategy.
You can execute strategy either:
- through continued or improved business-as-usual—executed through normal operational and continuous improvement management processes; OR
- through changes to business-as-usual—which you execute through (a portfolio of) projects or programs.
Strategy execution through continued and improved business-as-usual should be managed by operational management. This is part of their ‘day job’.
Strategy execution through changes to business-as-usual needs to be managed and driven by executive and operational management—assisted by project management specialists in a supporting role. Strategy execution should not—as happens in too many organizations—be abdicated to the project specialists with minimal effective executive and operational management involvement.
Your strategy’s execution impacts your competitiveness, customers and staff
Poor strategy execution directly impacts your competitiveness, customers and staff.
Your strategy defines—how you’re going to compete in the market both externally and internally. Your project investment portfolio is a major means by which you execute your strategy. So every deficiency in your capital investment management and value delivery processes undermines your ability to deliver your strategy and be competitive.
This inability to consistently deliver your strategy and value will impact your customers and competitiveness for example in terms of:
- Longer time to market for new products and services
- Compromised product or service design and ease of use
- Compromised features and functionality made available
- Compromised product or service quality and reliability.
Your staff will also be impacted, for example through:
- Retained or increased operational complexity and task time
- Increased workload, effort and costs to achieve the same outcome
- Compromised operational performance and reliability
- Compromised or missing systems and support features and functionality
- Reduced information access or integrity.
Shareholders will suffer because the business is not as profitable or sustainable as it should be.
To increase your strategy execution success, some of the things that you need to take action to address include:
- The culture surrounding projects and their measures of success
- How business value is identified so as to avoid missing 25% or more commonly lost upfront
- How the business value is managed so as to maximize its realized value and minimize any loss
- The drivers of project and business complexity and cost
- The drivers of unnecessary project rework and wasted effort
- The governance structure, so that they work to ensure they protect the business value, not destroy it.
This simple list illustrates how strategy execution is more than just assessing and prioritizing projects and their business cases.
Changing the business to deliver the strategy involves more than just ‘finishing a project’ or a series of projects. Projects may be the delivery mechanism but they alone do not drive or determine the strategy’s success.
Executive and operational management must drive strategy execution
You, the leadership team, will live and operate with the actual outcomes achieved. Therefore you need to be driving, leading and governing your strategy’s execution and ensuring the full delivery of the desired outcomes.
But to do this effectively you need the tools, techniques and processes to define, validate, plan, track, deliver and measure your strategy’s execution.
“There’s a process for that”
Successful strategy execution starts with defining “the desired (strategic) outcomes” as clear, specific and measurable definitions of the desired end states from your strategy. Until everyone knows what you are trying to achieve and where you’re trying to get to, they cannot commit or contribute.
Once you have your strategic outcomes defined you need to effectively drive, lead and govern successful strategy execution.
To equip you to successfully define and deliver your strategy you need several critical processes including:
- A strategic outcome definition process—that defines in clear, specific and measurable terms the strategic outcomes and results you are trying to achieve. Achievement of these defined outcomes is how you should measure your success.
- A strategy validation process—that equips you to assess if a proposed strategy will actually deliver the results claimed or needed. Many a strategy gives false hopes that can be easily found if you how to test it.
- A strategic contribution assessment process—so you can objectively score how each project contributes to each individual, detailed strategic imperative so as to ensure that each proposed project is strategically relevant and you know which strategies are (and are not) being delivered by your portfolio.
- A strategic portfolio prioritization process—to ensure the right projects are executed in the right order—to deliver the optimum business results as fast as practical
- A project viability tracking process—to identify early if projects have become strategically irrelevant, non-viable or unable to be fully delivered. Such projects can immediately be eliminated to avoid wasting any further resources on them. Cancelling projects no longer relevant can save millions in both project and ongoing operating costs.
- A strategy delivery tracking process—that reports to the board and executive leadership team how each strategy is being delivered, when and by which initiative or project
- A strategy delivery governance process—to ensure each project stays relevant, delivers the promised results and is successfully embedded into the business so that the benefits are fully realized.
Processes must be appropriate, known, used effectively to deliver optimum results
You may believe you have some or all of these processes in place—but just because they exist it doesn’t mean they are effective. Each process must exist, be appropriate, known, used effectively and be delivering the desired optimum results.
Many existing processes fail at the first or second hurdles as they either don’t exist or are not appropriate. For example:
An organization’s Portfolio Prioritization Process are often based on the executives’ personal opinions rather than being a transparent impartial scoring system that measures strategic relevance, value and capability to deliver. When strategically irrelevant projects—clearly seen and scored—are eliminated from the portfolio early this can release resources for those projects which do contribute to the strategy.
So you need to establish
- Do you have the requisite strategy execution processes?
- Are they appropriate, clear and complete?
- Are they usable and used effectively? Can you track your strategy’s execution?
- Are they delivering optimum results? Are they delivering your strategy in full?
A failure on any one criterion for any one process damages your business, your competitiveness and your ability to deliver your strategy. It is the failings in these processes that cause around 70% of strategies to fail.
It is time to take action.