Solving the Seven Key Barriers to Executing a Strategic Plan
Article by Jennifer Zajac and Herb Rubenstein
Introduction
Creating a great strategic plan for an organization is not easy. It takes knowing your organization’s capabilities, knowing the competition, understanding the marketplace, and being able to figure out where customers and potential customers are looking for new value in the marketplace from innovation. Executing your strategic plan successfully is even harder than creating the plan.
This article focuses on dealing with seven of the known, key barriers to successful execution. Successful execution begins with one fundamental principle. During the execution phase, everyone in the organization and your supply chain must know and be competent in his or her position/role and must understand his or her part in executing the strategic plan.
Executing a strategic plan has been the focus of excellent books including Larry Bossidy and Ram Charan’s Execution: The Discipline of Getting Things Done. Apple’s disciplined approach to execution has been lauded by Jim Collins and other notable business writers. The story of Steve Jobs demanding, at the last minute, that a glass screen be inserted into the 4S phone, requiring a complete overhaul of the manufacturing process almost overnight, is a testament to organizations being able to pivot on a dime quickly when the plan changes at the last minute. Apple has made the point that such a quick change in the manufacturing of a product is much easier to accomplish in a Chinese manufacturing facility rather than in a US facility. We believe US manufacturing is becoming nimble enough to accomplish similar feats in the future. It is clear that such a dramatic change requires the cooperation of many suppliers and having them all co-located closely in China made Apple’s rapid change in execution possible. But the US has for well over a century, and will again, create these manufacturing and supply chain hubs just as it has done in Silicon Valley over the past three decades.
Keys to Execution
Once the strategic plan is written, the hard part begins. Strategic plans often involve change, which many people and organizations frequently resist. However, when people fully understand the problems that strategic plans are developed to address, as well as the potential for organizational and individual success through implementing a strategic plan, more often than not they will get on board to help the organization build a better future. Therefore, in order to execute a strategic plan successfully, the known general barriers to effective execution and the specific barriers a particular organization might experience must be recognized, successfully dealt with, or and avoided by senior management and all concerned.
Potential Mistake Number One – Lack of Accountability
The mistake: The plan is created with proper employee and management input, but no group with proper authority, resources, reporting systems, and buy-in from senior management takes full ownership of the process and leads its execution.
The solution: Assign the responsibility for executing the strategic plan to a fully supported and properly compensated group. These employees require the authority to allocate capital as well as hire, fire, and relocate personnel. This group must establish an impeccable reporting, management and oversight system that provides information on a daily basis about the execution of the plan progress and problems that almost inevitably occur. This group must have direct access to all key personnel in the organization at all levels who will be instrumental in implementing the plan. Everyone in the group should have access to the daily data collection system so that they will be properly informed on a continuous basis and can speak with authority, backed by evidence, to every key employee (and supply chain partner) involved in the execution of the plan.
Potential Mistake Number Two – Failure to Delegate Properly
The mistake: Employees and middle level managers are hamstrung by top management and are not allowed to make the necessary decisions, including capital decisions, to execute the plan and make modifications when they see it is not working.
The solution: Organizations must allocate decision rights, business decision-making responsibilities, and provide key training throughout the execution process so that each employee at every level of the organization knows their role in executing the strategic plan. Strategic plans should “cascade” through the system where there is a set of direct links between senior management and each layer of management all the way to the shop level employees so communication can flow smoothly and accurately up and down the entire organization. Leaders must take responsibility to empower employees to raise red flags as soon as they think something is amiss. Employees must be empowered to fix problems, report them up the system without any fear of retribution, and most important, senior management must listen to the wisdom of the workforce and middle managers during the execution phase.
This approach will encourage the feedback senior management needs to make the required adjustments in operations for the optimal execution of the strategic plan. Feedback is essential because virtually no plan is executed as written. These plans are always modified during execution when there is excellent, objective, and unbiased feedback.
Potential Mistake Number Three – Inadequate Resources and Poor Timing
The mistake: Funding, resources, and personnel are not made as available as necessary to execute the strategic plan fully. Setting unrealistic deadlines for the strategic planning process will also hinder harm execution.
The solution: Your company’s budgeting process must provide for the resources and funds necessary for proper execution. Certainly, the strategic plan as it is turned into an operations plan must give an accurate estimate of the resources needed to execute the plan, and there must be resources properly allocated to all unusual and known barriers that could hinder execution of the plan. Further, the timeline and set of deadlines written into the operations plan and the execution process must be realistic, informed, and well-reasoned to ensure that the execution process will not start-off with an impossible task that will harm its execution.
Potential Mistake Number Four – Bad Data or Analyzing Data Badly
The mistake: Inaccurate and/or incomplete data collected during the decision-making and/or execution process is a killer to execution. Many companies underestimate the value of business intelligence and analytics. In addition, even accurate data may, in some instances, be misinterpreted or improperly analyzed during the execution process.
The solution: The ultimate objective of any strategic plan is to poise the organization for success. Data should be collected in a timely manner, verified and be sufficiently available to the right personnel so that there are many eyes looking at and studying the data. Data must be analyzed with the best available analytical tools and methods and the analysis must be reported in a manner that is easy to digest and understand.
Potential Mistake Number Five – Failure to create proper review processes.
The mistake: All too often, organizations devote a considerable amount of time to formulating a plan and insufficient hours or attention to assessing the progress of a plan in a manner that provides the timely feedback to help steer execution onto the right course before it gets very far out of hand.
The solution: Establish regularly scheduled meetings for reviewing the progress of executing the strategic plan. The individual responsible for the process must ensure that there is an excellent reporting system up and down the chain of command. In essence, everyone in the organization must know that “red flags” are welcome at every turn. When feedback comes in it must be quickly and intelligently analyzed and turned into the basis of proper corrective action.
Potential Mistake Number Six – Failure to Address Problems.
The mistake: A challenge arises during the execution of a strategic plan and is not addressed in either a timely or high priority enough manner. This failure reduces the likelihood that the execution phase will go along smoothly or meet its objectives.
The solution: Timely and effectively dealt with communication is the key to successful execution of strategic plans. Problems should be raised and addressed on an ongoing basis. All communication should be documented in a central document library electronically and shared with all necessary decision makers and implementers. This should provide sufficient opportunity for many people from multiple perspectives to weigh in on the development of the corrective action and the implementation of the corrective action necessary to put the execution of the plan back on track or on the new track developed in light of the new feedback received during execution.
Potential Mistake Number Seven – Failure to Plan for All the “Known Unknowns” and the “Known Knowns.”
The mistake: Not preparing for recognized risks that may arise during the execution phase, such as potential environmental, legal, health, financial, competition oriented, human capital, sales, distribution, or supply chain problems.
The solution: Identify as many risk scenarios as possible and develop contingency plans for addressing them. Example: Keeping back-up copies of critical files at another location if one building is destroyed. The legendary (and possibly true) case of Mr. Gartner is illustrative of this situation. In the late 1970’s/early 1980’s he wanted to develop the world’s first laptop computer. All was going well after millions of dollars of investment and the beginning of manufacturing until the only supplier of batteries in his supply chain filed for bankruptcy and failed to deliver the needed batteries.
Conclusion
Successful execution of strategic, business, and operational plans requires knowing the potential pitfalls in advance and dealing with information as it comes in from the shop floor, customers, supply chain providers and managers that something needs to be changed to get or keep execution on track. Adaptability may be the most important attribute that manufacturing, and others involved in large-scale execution of strategic plans going forward. The recent Apple 4S story of the glass screens shows that even large organizations and activities can be changed and can pivot quickly. This article may help pave the way to better implementation of large-scale IT projects and execution of all types of strategic plans for businesses, colleges and universities, nonprofits, government agencies and NGO’s (nongovernmental organizations) around the world.