Why Good Strategies Fail

Strategy execution has always been the essential complement of strategy formulation for any local government or regional authority. An increasing speed of technology-enabled change has meant the importance of strategy implementation has increased exponentially for all of us.

Organisations will not necessarily differentiate themselves by their ability to see how markets or the sentiment of their ratepayers are moving. Setting your organisation apart will be by carrying out the necessary strategic response to changes as quickly as possible. It’s the C-suite everywhere that gets it right or delivers sub-optimal results – or we blame them for it anyway!

How do you help the C-suite get a better result?

Eighty-eight per cent of a survey by the Project Management Institute said that executing strategic initiatives successfully will be “essential” or “very important” for their organisations’ competitiveness over the next three years. This was a result from a survey in 2013 by the way.  Has anything changed since then? 61% of respondents of the PMI’s survey then acknowledged that their organisation struggled to bridge the gap between strategy formulation and its day-to-day implementation. “Hey so do we!” may be your response. Hasn’t the pandemic taught us how to manage uncertainty? 

However, a more recent result is that an average of just 56% of strategic initiatives had been successful from that control group first surveyed.

Poor implementation means that an organisation’s stated strategy fails to shape what happens in practice. Only a very small number within the same recent survey also stated their business model or practices are extremely well aligned with strategy. 

Failing budget requirements? Can’t deliver projects right? Where do we all go wrong then?

C-suite executives are often missing in action

The number-one reason for the success of strategic initiatives at any organisation has to be leadership buy-in. Secondly, it all goes south without the vital support from their teams. Rather than micromanaging, C-suite executives should identify and focus on the key initiatives and projects that are strategically relevant. “Hang on?” you ask, “isn’t that what we are all trying to do now?”

The keys identified contributing to success are general oversight, leading and supporting strategic initiatives and here is the big one – communication. 

We all know how the Japanese principle of continuous improvement sees top levels and others walking their factory floors under “Kaizen” to bring about change for the better? How then is change communicated in those heirarchies? Can we learn from the Kaizen Principle?

How invested are you in the change? How desperately do you really want the improvement?

Top executives should pay special attention to the key initiatives and projects that are most important to corporate strategy. This entails involving corporate leaders in high-level decisions on the selection and prioritisation of such initiatives, as well as the allocation of resources to them. Remember he who has the gold makes the rules because that is the “Golden Rule!”

This means we may have to step in, despite how busy we are to truly examine, like those Japanese leaders who walk their factory floors, looking for an improvement or change. We can at worst refocus or get refreshed as we envision what can be. Maybe a “baby step” forward may come from that practice. The Kaizen managers alter their outlook and then diverge to solve problems identified, or they may apply valuable expertise to the issues or improvement efforts by consensus. Japanese motor executives were very invested in their foray into luxury cars and this resulted in Lexus  where design and  improvement all comes from consensus. Consensus achieves alignment and maybe buy in? 

A majority of companies either lack the skills or fail to deploy the personnel needed for strategy implementation

41% of respondents of the most recent survey  say their companies provide sufficiently skilled personnel to implement high priority strategic initiatives. 

Who are you hiring? Are you hiring the same “type of people” as you have in the past? Are you investing in your top and middle leadership? Any entrepreneurial or intrapreneurial types in your teams? Are you hiring anyone that has ever delivered operational change anywhere? They are the ones who usually saw the strategy in C-level meetings or other, and became responsible for delivering the changes and sometimes the communications to line managers and teams.

Executives may be neglecting the low-hanging fruit: organisations that typically provide both types of human capital, that is C-level people who are invested or have bought into their organisation’s strategy and the people who want to deliver change or improvement that an aligned strategy delivers. Organisations that did this, succeeded in 62% of such initiatives and there is a correlation found between companies that do better at implementation and those that focus more heavily on obtaining the requisite business and leadership skills in their people.

Success results from working at implementation in a variety of ways, but the financial rewards justify the effort. 

If anything, the survey shows us that there is no silver bullet to achieve better strategic implementation. Kaizen can help but surely organisations that rate themselves highest in the area of C-level buy in, must also then by default share a range of characteristics? Greater levels of C-suite involvement, better feedback mechanisms, more resourcing—particularly providing human resources—for initiatives and more robust processes contributes to better alignment and strategic outcomes.