Strategy Execution: Why Companies Fail to Get Sh*t Done

American management guru Peter Drucker said the following about the only two functions of the business:

"Because the purpose of business is to create a customer, the business enterprise has two - and only two - basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs."

I am going to propose a different view on this question. The two most important business functions are strategy and strategy execution. More than that, I would even go as far as to say that the thought that execution is #1 in this duo is getting traction. Let me explain.

The primary objective of every business is to achieve results. For some, it's shareholder value, for others happiness of their customers and employees. Whatever the north star, businesses have something to strive for.

A strategy is a plan of how to get those results. How to move from point A where we are today to point B where we want to be. It is crucial because strategy helps us to organize our actions, and without actions having a goal is just wishful thinking.

The last point also explains why strategy execution is crucial. Action is what brings results, not the plan. Why did I earlier mention that execution is even more important than the strategy itself? Because in today's volatile, uncertain, complex, and ambiguous world action informs strategy. Why all the buzz around agile and lean? Because we are adapting our 5-year-old Soviet-like plans to the realities of today. There is a whole body of research literature on emergent strategy, and it's quite fascinating.

How and Why We Fail at Getting Sh*t Done

Here is a quote from the HBR article on the topic that is illuminating:

"Our research reveals that, on average, 95% of a company’s employees are unaware of, or do not understand, its strategy."

This issue is at the core of strategy execution. How then do managers try to remedy the situation? Communication is believed to be the key to execution. Leaders try to communicate with their direct reports and hope that they will pass the message successfully. 

Does that remind you of anything? As a child, you might have played a game called the Chinese telephone in which players form a line where the first person in line comes up with a message and then whispers it to the second person in line, the second in line whispers what she understood to the third, and so on. Isn't that exactly what happens in our organizations?


Another approach to enforcing strategy execution is training. Often, hundreds of training sessions for thousands of people. Yet, according to research, 88% of people do not apply the learning from training to their work. 

The reasons why this happens are beyond the scope of this article, but if you are interested check the book "What makes training really work" by Ina Weinbauer-Heidel. Just one cause I will mention here is that training often overlooks the individuality of the people involved. We put 30-100 people in the same room and assume that they all will be affected in the same way. It might help with awareness, but it often lacks the depth to trigger understanding.

Another popular tool managers use to drive change and transformation is anonymous pulse surveys. The main challenges with the survey approach are that (1) people aren't always honest because they don't have trust in the survey system and don't know how the data will be used and (2) employees often aren't reflected enough to be able to pinpoint the root cause of the challenges they experience, simply because they rarely think about those, lack the tools for that, and aren't incentivized for strategic thinking. If you are interested to explore why employees should be able to think strategically, think like a CEO, check my another article

Join us in creating the solution

Sometimes as leaders we get annoyed with our people not delivering, not getting sh*t done. And that's OK, it's human. The modern leader is supposed to be one hell of an Übermensch. People person, effective, strategic, analytical, having a work-life balance. It's a worthy goal to strive for, but we should also realize that we are all work in progress and approach the challenge step by step. 

Roughly a year ago we embarked on a journey of supporting the managers in their tough job of driving strategy execution. Our approach is twofold. One the one hand, we use a personalized approach to every employee at scale. Coaching is known to be more effective than training, but it's predictably a lot more expensive. We developed a service that we call micro-coaching which allows us to make coaching 5-50 times cheaper than the traditional approach. 

Coaching is especially relevant in strategy execution because it is about the individual, their goals, and as such leads to higher employee ownership. And ownership is one of the keys to successful strategy execution.

On the other hand, we also realize the importance of the top-down processes and understanding organizational blind spots, seeing which processes don't work. This is another issue where our micro-coaching service delivers value. We found a way to painlessly collect a ton of qualitative data through coaching conversation history. That data, anonymized, yields often surprising insights about what's going on on the shop floor of a particular organization.

We try to combine the bottom-up and the top-bottom approaches to strategy execution. Or, in other ways, we aim to enable people to strive within current conditions, while also working on optimizing those conditions and structures. You can read more about our micro-coaching approach in my article here or on our website.

We are looking for partners of all kinds and would love it if you could reach out to us. Our aim is to co-create the solution together with our clients and the broader ecosystem. Join us: the journey ain't promising to be easy, but it would for sure be worth it!


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