What's your plan to overcome the strategy-execution deficit?

The first step to solving a problem is to recognise you have one.   Netflix CEO Reed Hastings recognises his biggest challenges now are execution.  Do you have an execution challenge? 

But before you can execute, can you summarise your strategy in 35 words or less?  Would your colleagues put it the same way?  And would they recognise the same top five priorities?  Check out what the research tells us.  

On execution, too many organisations are serial under-performers.   What specific action steps will take your organisation's strategy execution to the next level.  We have developed an Execution Playbook to help clients tackle the challenge of execution. 

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Bridging the Strategy-Execution Air Gap

My previous blog on execution provoked this lament from one reader:

“See, this is what shits me.  We don't want to take the time to actually consider the execution piece of our 'strategy'. Once we have something that looks pretty on paper we then go back to bidding work willy nilly and trying to operationally improve our projects on an individual basis.”

I had written about the socio-cultural elements that could bring much greater success to your strategy execution efforts.  But this only works if you have the fundamentals in place.  Unfortunately organisations often experience an 'air gap' between strategy and execution.  

This blog highlights the gap between the 'what' and the 'how' of strategy execution.  Mintzberg's mantra of 'codify; elaborate; convert' offers a sound process to close this gap.  

You can't solve a problem you haven't defined.  Do you have a strategy-execution air gap?

 

 

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Can someone help me please? I'm stuck!

At a recent workshop a client expressed the fear that she felt stuck when thinking about strategy execution.  That's not surprising.  Research consistently shows that organisations massively under-perform on strategy execution.  

I outline five practices here that will give you a winning edge when it comes to strategy execution. Execution is not a trivial part of managerial work: it defines the essence of that work.

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Apparently mining blew the boom ... but who's the greater fool?

The headlines scream at you: major miners blew the boom.  It is true they repeated the patterns of all commodity booms.  But are we guilty of playing Monday morning quarterback?  What might they have done differently?

And what about shareholder value?  When did we lose sight of the value part of the equation?  And who was the greater fool?

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Let's talk productivity and technology management ...

Technology should be an integral part of any productivity strategy.  But why do some organisations struggle to develop effective technology strategies?  This was a question we put to the leadership team we were working with on a technology strategy some years ago.  They identified 6 distinct barriers:

  • Lack of aspiration … there was no clear ambition
  • Lack of a technology strategy … resulted in a random approach to technology
  • Lack of awareness … little knowledge of the external possibilities
  • Risk aversion … doing nothing seemed less risky than doing something
  • Lack of capability … lack of structures to effectively engage in the strategy
  • Lack of execution … folklore around poor technology implementation (over budget/over time/under delivered)

How does your technology strategy stack up?    

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Rethinking leadership development - it's about strategy execution

About 15 years ago a major Australian resources company set out to develop ‘world class leadership’.  But Professor Chris Worley rebuts[i] the usual prescription of ‘more leadership’.  He argues that asking people to change behaviours without changing the underlying system – the structure, systems and processes – is borderline immoral. 

Leadership requires us to develop new behaviours and create a context in which those behaviours can flourish.  My research explored the barriers organisational context creates in the pursuit of 'world class leadership'.  These prove to be at least as important as individual factors.   But what are the conditions we need to create to enable leadership?  

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Business behaving badly ... we're no worse than the others

Business leaders often lament the lack of political leadership and community support.  It’s only going to get harder.  WA Premier Colin Barnett, at LNG 18 – the premier global conference of the LNG industry – offered some advice to the industry: you guys have to do more of the heavy lifting.  It is no longer viable, if it ever was, for industry to expect the politicians to take the lead in the public battles.

And yet the list of examples of decisions which make it nearly impossible for business to win public support continues to grow.  These various decision failures impact three critical stakeholder groups: the community; the suppliers; and employees.  And this has both direct and indirect costs.

Major corporations are not naïve about these issues.  But we need to get much smarter at anticipating and addressing these broader stakeholder issues.    Often these decisions reflect a progressive, cultural failure compounded by hubris and arrogance.  Just because you can doesn’t mean you should. 

We need to ‘inoculate ourselves’ from this cultural detritus.  I suggest three possible 're-calibration' processes

(4 min read)

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Strategy lessons from the greatest CEO in tech history … and it's not Jobs

The recent death of Andy Grove passed unremarked in the Australian press.  Grove has been called the greatest CEO in tech history: he mentored a young Steve Jobs.  A former Intel CEO, Grove was responsible for the transformation of Intel from a ‘memory company’ to a ‘microprocessor company’.  Few companies have successfully redefined themselves so fundamentally.  When Grove stepped down as CEO in 1998 Intel was earning $6.9B profit on $25B revenue. 

The story of the transformation remains a classic case study in strategic leadership.  

I highlight three key lessons and suggest some practices you build into your personal leadership repertoire.

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Strategy's fundamentals ... better practice, not neater theory

Henry Mintzberg was right when he declared ‘we need better practice, not neater theories’.  Three theoretical paradigms provide an overarching framework for strategic thinking.   And these were part of the economics discourse more than 50 years ago.  But any one of these by themselves is insufficient.  

It is the overlay of the insights from these three paradigms that create the case for change and that shape the strategic option space for an organisation.  Organisations can improve the quality of their strategic thinking by applying these frameworks with a combination of discipline and creativity.  

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The cost of presumptions - international case studies

At their most dangerous presumptions are assumptions that are accepted as a ‘social fact’.  This makes them more dangerous than assumptions.  Assumptions should be explicitly identified and can be tested.  But we remain blind to our own presumptions. 

The risk of presumptions is everywhere around us in the age of disruption, but it exists also in other areas.  Shell lost control of a major project in Russia; Tata had to move the Nano car plant weeks before commissioning.  

Presumptions in both cases turned out to be a very costly.  

What can you do to reduce the unanticipated risk of presumptions?

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Breakout strategy: what if anything were possible?

At its core, strategy is design.  And great design starts with the question: what if anything was possible.  If we start with constraints we get designs for tomorrow that merely tweak today.

What if we applied the same design principle to the strategy process?  This would improve the chance of creating something truly distinctive: a ‘breakout strategy’.

In preparing for a leadership conference Starbucks CEO Howard Schulz argued:

Before we could challenge the status quo, my colleagues and I had to see it in new ways, reframe our existing ideas, and move beyond self-imposed constraints to imagine new possibilities.

How bold are you willing to be  to achieve something truly distinctive?  

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Avoiding Gray Rhinos ... strategic renewal and the status quo trap

Strategic renewal is a fact of life,  While strategies constantly evolve, organisations experience strategic drift either through organisational entropy (the tendency for systems toward increasing disorder) or market and competitive shifts that are no longer reflected in our strategies.  The challenge is to respond to these issues before you reach crisis.  Regrettably, organisations often move too late.  Why?

There are two explanatory factors: a ‘failure to see’ or a ‘failure to move'.  This blog illustrates the power of some of these issues and describes an approach used in a recent workshop to overcome some of these limitations.   

This is part 2 of a three part series of blogs looking at some of the issues at different stages of the strategy life cycle.  To see the earlier blog click here

 

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Looking back, looking forward

2015 will go down as the year when I really started to blog, with 36 blogs.  The dominant themes reflect my roots: leadership, strategy and business models.  Based on reader responses the three favourite posts were:

  • The disruption engine ... which gives the reader a high level overview of a couple of models which seek to explain disruption.  I conclude with a few ideas which the reader could use to 'test' their exposure to potential disruption
  • Opening Minds - lessons from Cirque du Soleil ... it may have been due to the beautiful video clip, but the blog was about understanding where you sit in terms of the strategy life cycle.  At different points in the strategy life cycle the focus of the strategy  process changes.  The biggest risk is at the high point of the cycle, just before you crest and begin the downward slide.  At this point the risk is under-reach rather than over-reach.
  • Leadership Lessons from Ross Lyons ... this was a shorter piece in which I challenge leaders to look at under-performance of their teams through the same lens Ross applies. If they are under-performing, that starts and finishes with you.  Ouch.  

So, that was the 'readers' picks'.  Among my close friends/colleagues there were two that they really enjoyed:

  • Are you ready for the next big shift ... highlights the limitations of strategy processes to really pick the big shifts.  Most practitioners reach for scenarios under conditions of real uncertainty, but this blog highlights the limitations even using scenarios.  I finish with one suggested method.  But I don't pretend it is easy.  
  • Excellence - lessons from Sting ... again, comes with a video link, it explores just what it takes to achieve excellence in your domain.  And finishes with the observation that 'pursuit of excellence should come with a product warning'.

And so finally, my favourite?  Hard to say, but recently I posted a blog on what I called the profound responsibility of leadership.  It reflects my passion: my belief that we, as leaders, have the potential to create great organisations.   I will finish with a couple of lines from a recent World Business Forum that resonate with my world view:

  • Creative leaders emotionalise ... rational thinking leads to conclusions, emotional thinking leads to action 
  • Our value share in an ecosystem comes from our share of passion ... organisations need passion to overcome ADD (ambition deficit disorder)

And so as I look forward to 2016, I've a number of fresh ideas which I will be blogging about and also talking to my clients about.  I think we should collectively declare 2016 our 'break out year'.  All the best for the festive season, and the new year.  Stay safe, share your joys with your family and loved ones.  

 

Austerity is not a strategy

Three clients, three strategy workshops, 8 days: intense.  Each client is at a different stage of the strategy life cycle (see my recent blog).  And each workshop highlighted a theme which reflected where that client sits on the strategy life cycle.

Mining services clients are clearly in the ‘rebuild’ phase.  For about two years now the mining sector has drawn up the moat bridge.  The more recent collapse of the oil price suggests the oil and gas sector is about twelve months behind the miners.  

Mining services companies have followed suit, with even more dramatic headcount cuts, many of them in survival mode.  Austerity became the main game.  

But let’s be clear: austerity is not a strategy.  So what is next?  

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The profound responsibility of leadership

The most creative conversations of our professional lives engage both our emotional and analytic selves.  These conversations are the source of inspiration and sense-making that leave you buzzing hours later; that wake you in the middle of the night; that create new insights through connecting previously disconnected ideas. 

I had such a conversation a few months ago with a colleague.  Exploring the role of purpose in organisations, he challenged me to articulate my purpose: why do I do what I do? 

One of the outcomes of that conversation was a paragraph I wrote about the profound responsibility of leadership.  I didn’t post it at the time, at least in part because I suspect for many business leaders – prospective clients – it might seem ‘too soft’.  But after some interesting conversations yesterday I decided I would share my world view.  So here’s what I wrote those months ago: 

I believe in the capacity of leadership to create great organisations … organisations that can develop and execute strategies that match the demands of a complex and changing environment; that can build connections with customers that transcend the simple transactions that characterise too many market places; that create customer experiences that build longevity into the relationships.  And this comes about through leaderships’ capacity and commitment to engage with the people who are the body and soul of any organisation and want to make a contribution that goes beyond just earning a wage. 

This is the primal responsibility of leadership.  If not this, then what is our job as leaders?

I also believe in the self-evident truth: it is the leadership teams which need to design, develop and energise the change in organisations.  Our job as consultants and advisors is to help them in that pursuit. 

This is my ‘bias.’  It shapes the conversations, approach, and expectations in my work as a strategist, facilitator and teacher.  And I think this is largely reflective of my clients.  The people I have worked with over the years who I connect most deeply with do feel a profound responsibility. 

But over time many leaders slowly, often unconsciously, withdraw from this profound sense of responsibility, reflecting a felt lack of a shared sense of responsibility among their peers and their leaders.    Or sometimes in the face of challenges that seem overwhelming.  But this model of leadership demands institutional leadership: it is beyond the capacity of individual leaders.

Do you feel this profound responsibility?  How often do you experience deep, creative conversations within your organisation which engage both your emotional and rational-analytic self as you explore your collective role as leaders?  Do the conversations leave you buzzed?  Or just frustrated?  If the latter, I suspect the ‘emotional’ self has been ‘shut out’.  Caution: the failure to engage the emotional self can ultimately lead to ‘burn out’.  

The more things change ... strategic innovation

I am often struck by how today’s 'insights' reflect the writing of past decades .  In this blog I highlight a few recurring themes on strategic innovation which we have been writing about for 20 plus years.  That we continue to talk about them suggests they are valuable levers in the pursuit of strategic innovation.

And I suggest three practices which you can introduce into your business today to improve your capacity for strategic innovation.  

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Leadership lessons from the world of Australian politics

Leadership and strategy are inextricably linked.  One without the other is like fertiliser without water: wasted.  The reader could be forgiven for raising a quizzical eye at the suggestion there is anything to learn of leadership from recent years of Australian politics.  But applying the adage we learn more from failure than we do success, perhaps there’s something here for us all. 

What follows is a summary of my five key lessons for business leaders from Australia’s recent political history.   How well does you/your organisation stack up on these issues?  

But remember this.  All leaders are flawed.  Undoubtedly Malcolm Turnbull will reveal flaws over time.  The real issue is not the existence of the flaws, but awareness of the flaws and a willingness to establish mechanisms to protect the organisation from their downsides.

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Purpose is at the heart of strategy ... but it's complicated!

Why does your organisation exist?  Because if you can’t articulate your purpose, then I’m not sure how you determine your strategy.  That might seem a simple question, and yet if you asked your executive team I wonder how many different answers you would get? 

Every business is has three distinct beneficiaries: capital; customers; and talent.  And each of these beneficiaries expects different ‘benefits’.  In reality you are competing for each of these ‘beneficiaries’ with a benefit (value proposition) that at least meets their expectations.  

Does your strategy and business model present an overarching strategic architecture which binds these three dimensions?  

(5 minutes reading)

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Opening Minds - Lessons from Cirque du Soleil

A client briefing me recently ahead of a strategy forum cautioned that they were a tough audience.  Exposed to an array of corporate leadership development programs over the years, with a lot of capability in their respective fields, the challenge was to fully engage them in the search for fresh possibilities.   

The reality is that most strategic conversations do not take place under ‘crisis’ conditions but somewhere along a spectrum of change dynamics.  And where you sit on the spectrum influences your process design.  

I opened the workshop with an exquisite video clip from Cirque du Soleil (watch here).   To learn the lessons from Cirque du Soleil read on ... 

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The Business Model Test - the narrative and the numbers

Fifteen years ago Joan Magretta (HBR) observed that all business models must satisfy two tests: the narrative – does the story make sense – and the numbers – does the P&L stack up.  This remains the standard today.  

The narrative has both an emotional and a logical dimension.  The emotional content allows people to connect with your passion.  The compelling logic shapes the numbers.  A good valuation is more about the story than the numbers … if the valuation proves to be wrong, the problem will be in the underlying narrative, not the numbers.  The pursuit of the numbers forces us to make explicit our assumptions, and crystallises the value drivers within the business model.  These critical value drivers focus our thinking at each successive level of business model design.

I finish with three questions on the business model which every executive and Board member should be able to answer. 

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