In today's uncertain environment, where global politics is unpredictable and markets are increasingly competitive, strategic planning and effective methods of execution are vital. However, Strategy& found in their survey 'Top Leaders Effectiveness at Strategy Execution and Development' that only 8% of the 700 business leaders are confident to say they are effective at both planning and execution, with 63% admitting they are 'neutral or worse.'
Does it mean that 441 of the surveyed executives rely on luck and gut feeling?
Considering that strategy doesn't make sense without execution and vice versa, the knowledge gap in 'strategy-to-execution' must be erased, otherwise, some companies will continue blaming external factors for their problems and failures. Strategic planning and execution are inseparable as they are parts of one process which keeps the business engine humming. However, for a better understanding of their importance as a whole, it can be useful to break it down.
With strategic planning, regardless of the methods a company chooses to use - whether it's hiring third party strategy firms, appointing a CSO, calling for meetings, or performing everything digitally - any strategy must match the environment the business is in. The market is a dynamic ecosystem with pitfalls, opportunities, and constantly changing trends. The business strategy is there to help a company to respond to these promptly and provide them with tools to take advantage of new opportunities.
One of the thoughts executives often overlook when creating a strategy is the detailed guidance on how the company is going to get to the execution phase. This may happen due to too much focus on financial aspects and outcomes - which is important, but if the details of how to actually increase revenue and improve business performance are missing, targets won't be hit.
Business leaders should never undermine the changing nature of the market. Rather than purely financial goals, a modern strategic focus needs to shift towards competitive advantage. As such, target setting should be focused on our performing your competition, with a focus on your products and services (their strengths and weaknesses), how to reach the market more efficiently, and ensuring rivals cannot match your strategic strengths. But as much as your strategy is engaged with external competition, there must also be strong internal engagement.
When strategic meetings happen behind closed doors, and only executives and third-party experts engage in the creation of goals and their execution, the overall productivity, and understanding of the company's vision might be damaged. Engaging employees within the strategy can significantly increase the quality and the speed of planning and execution, as after all, employees know the company and they can suggest or develop new angles for the process of execution.
As Umberto P. Fedeli, President and CEO of Fedeli Group rightly pointed out: 'Without execution, there is no momentum', because even the best plans are a waste of time if no actions are taken to reach the goal. Poor executions, on the other hand, are not an option either, as those can cost considerable amounts of money, increase turnover rates, and eliminate your competitive advantage.
And that's why it's critical to be good at both planning and execution. By getting it right with the preparation of key resources which can further result in actions, there will be no strategy or execution, but one tangible and forecastable process.