Every strategy has four fundamental jobs to do if it is going enable successful delivery. But what are the critical elements your strategy needs and is now the time to re-think your approach?
How long does your organisation spend developing it's strategic plan? If you add-up the relative salary costs of all the people involved, then add the cost of off-site venues, town-hall style employee roadshows and glossy collateral, how much does the process cost?
So how about the other side of the equation? What returns are you getting for this investment? How often do your people use your strategy on a day-to-day basis to help them make decisions? How often does the strategy you created deliver the outcomes that were so beautifully crafted in the document signed-off by The Board.
Strategy and implementation - an unhappy marriage
If you're organisation is like the majority, then the amount of effort put into developing your strategy is significantly more than the value it returns. More importantly, somewhere in the space between strategy creation and strategy delivery, something goes sadly wrong, leading to disappointing results.
80% of leaders believe their organisation is good at formulating strategy, but only 44% think it's good at implementation (1). Further only 10% of organisations achieve at least two thirds of their strategic objectives (2).
Of course, none of this is new news. And, if we go with the majority view, then the lack of success sits not with the strategy but with a failure to execute.
I have a different view. In fact, after nearly 25 years developing and implementing strategy, experience has taught me that it's the way strategic change begins that determines the way it will end. It needs to start smart or no amount of organisational capability, investment in planning technology or external consultants will deliver the desired outcome.
The 'fit for purpose' strategy: Five critical qualities
By the time a strategy is complete (ie. by the time it goes to your Board), it needs to possess five critical qualities. It needs to have:
clearly identified the value - ie. its clear what value is being created for customers and how that in turn, will create economic value for the business.
created alignment – ie. it has created a shared understanding of why the strategy is needed, what problem it solves and why the proposed action makes sense.
fostered engagement – ie. created a voluntary willingness to contribute and make personal change in the interests of a greater outcome
set a clear direction – so everyone is moving towards the same outcome
generated the impetus for action – ie. the collective willingness to move from where the organisation is, even though the path ahead is not yet clear.
All of the above needs to have been achieved not only within the Executive Team, but among the broader leadership community (who will ultimately be expected to deliver the results).
But why are these five strategic qualities so critical?
The Fuel of Strategic Success
In some ways, your strategy is like a bus. It's job is to move your organisation from A (where you are) to B (where it needs to be). However, before the bus can go anywhere, it needs enough fuel to reach its destination. That's what the five elements above provide and when applied correctly, they create fuel in the form of:
Energy - your people have the energy and desire to go on the journey. This resists fatigue and the exhaustion that so frequently accompanies major strategic change
Focus - your people have the ability to make priority decisions and channel their energy into the actions that have impact. When people feel able to make decisions on their own, they feel empowered and confident to move forward.
Progress - the team is able to move forward 'as one' and deliver the right result. This gives everyone, including stakeholders, teams and Boards the sense of achievement that's needed. It also means that after all the investment and effort, the strategy actually delivered the result.
Momentum - the strategy and more specifically it's energy, starts to propel itself because there is less change-friction holding it back. This helps overcome any resistance and builds a sense of urgency.
Bringing it all together
So let's come back to the strategy development process within your organisation. How do you know if it's doing the job that you've paid for. Ask yourself these questions to help you find the answer.
When your strategy is finished and has been signed off by the Board, is the entire leadership community aligned and engaged enough to lead it with passion?
If you asked all your leaders why the strategy was needed and what it ultimately aimed to achieve, would you receive a positive, consistent answer?
If you asked each leader to describe the strategic direction, would they say the same thing?
If you asked your leaders to take action, would they all do so with equal confidence and be willing to step-out into the unknown?
When I'm working with Executive teams I often find leaders know that their strategy is not doing the job it needs to, but they're not sure how make the shift needed to increase strategic success. If you answered 'no' to any of the above, the chances are your strategy is not doing the job it's supposed to.
So, as 2017 enters its twilight months and 2018 looms large on the horizon, perhaps now is the time to try a different approach.
Thank you for reading. Please remember to share this article with others who may find it valuable.
Kate Christiansen is a facilitator, mentor, award-winning author and keynote speaker. She works with leadership teams who have reached an inflection point and need to set a new direction. Kate helps her clients to understand their unique moment of opportunity, define the new path that will create maximum value, then spark positive change, that's powered by the passion of people.