3 STEPS TO CLOSE THE STRATEGY EXECUTION GAP

It Is Important to Close the Strategy Execution Gap

To close the strategy execution gap in a meaningful way, leaders must agree upon and commit to a set of specific priorities focused on achieving clear and meaningful goals and accountabilities. According to a recent survey of almost 600 senior global executives by the Economist Intelligence Unit, 88% of executives consider successful strategy execution to be “very important” or “essential.”

I hope so. Recent BCG research found that over half of the Fortune 500 companies from 2020 have gone bankrupt, been sold, or have shut down. Is your strategy setting you up for long-term success?

It Is Difficult to Close the Strategy Execution Gap

Strategy execution however is easier said than done. It's not surprising, that companies that struggle to close the strategy execution gap after their strategy retreats report weaker financial performance.

• 61% acknowledged that their firms struggle to implement strategies

• Just 56% of strategic initiatives have been successfully implemented

• Only 41% of respondents say their companies provide sufficiently skilled personnel to implement high priority strategic initiatives
  

3 Steps to Close the Strategy Execution Gap

If you want to outperform your peers and close the strategy execution gap, follow these three steps.

1. Create Unquestionable Strategic Clarity

Our organizational alignment research found that strategic clarity accounts for 31% of the difference between high and low performing organizations in terms of revenue growth, profitability, customer loyalty and employee engagement.

You will know you have enough strategic clarity to set the stage to close the strategy execution gap when those who are responsible for creating, leading and executing the strategy (1) fully understand where to play and what actions to take, (2) believe the strategy will lead to successful results, and (3) know the strategy makes sense in your specific culture and market.

Before a strategy can be properly implemented, you must have leadership buy-in and support.

Then, key stakeholders need to understand (1) why change is necessary, (2) what change will do, (3) how they will be good at the new ways, (4) what their role will be, and (4) how change will be supported throughout the organization by the right leaders and with adequate resources.

High performing teams spend more time creating a shared strategic clarity and aligning the organization around that strategy than their peers.

2. Double Down On Effective Strategy Translation

Once you have created unquestionable strategic clarity strategy with your key stakeholders you must effectively communicate your strategy to those who matter most.

The most frequently used method of communicating strategy is through cascading the strategic imperatives from the C-Suite to Managers who then translate the strategy into day-to-day operations for their employee teams.

The highest performing teams spend more time helping stakeholders directly translate the overall strategy into actionable goals while simultaneously identifying barriers and clarifying cultural guardrails.

The secret to effective strategy communication is to actively involve as many employees as possible in thoughtful, active participation in translating the strategy into day-by-day contributions and deliverables.

To truly close the strategy execution gap, you should plan on spending twice as much time with every level of the organization on execution as you did on design. For example, if your executive team spent one month designing the strategy and held a two-day strategic planning offsite, plan on spending two months and four days with their direct reports to get the same level of commitment and ownership.

3. Empower Employees to Implement the Strategy and Hold Them Accountable

When it comes to improving your chances of strategic success, micromanagement does improve strategy execution. High performing teams that consistently close the strategy execution gap spend more time empowering employees to define and deliver their unique contribution by:

• Providing general oversight

• Influencing high-level stakeholders

• Establishing success metrics

• Sticking to priorities

• Monitoring progress

• Allocating resources

• Investing in capabilities

• Responding to change

The Bottom Line

The more you can actively involve employees in strategy design and implementation, the better your chances at being able to close the strategy execution gap that eludes 44% of companies. What percentage of time do your leaders spend fighting fires versus actively engaging stakeholders and purposefully aligning the organization around the critical few priorities?