Why Strategy Fails
When a core strategy fails, one of the most detrimental consequences is “strategic churn” — the all-too-frequent layering of one failed or incomplete strategy upon another. This saps energy and exhausts organizations, disenfranchising stakeholders and conditioning employees to await the next “grand vision” sent down by senior management.
While external factors certainly play a role in strategic failure, the most common are well within the control of executive leadership.
1. Not starting at the beginning: Flawless execution will not overcome flawed strategic assumptions. Underestimating market trends or customer needs, or overestimating the organization’s abilities to respond to them, dooms efforts from the start. Similarly, simply driving the “old way” harder despite clear evidence of a changing market is a key cause of strategic sub-optimization. Executives must close their planning process by honestly answering the question: What must we believe to make this strategy succeed?
2. Confusing planning with delivery: Anyone who has experienced the intensity of a strong strategic planning process has experienced relief at a successful rollout. However, in successful organizations, this relief is temporary, and management understands that the real work of delivery and execution has just begun. Many organizations mistakenly equate planning with execution and a goal with results. A process for execution and resource alignment must be the final element to close the loop on a successful strategic planning process. Anything less reduces accountability, focus and success.
3. Being disconnected from the vision: Well-developed strategy answers the question: How will we achieve and monetize our vision? It is the context for all decision making and resource allocation. The link between your vision and your strategy must be crystal clear.
Don’t have a clear and compelling vision? Get one. There is no more powerful engagement tool to help employees see how their everyday activities connect them to a grander purpose. Every employee should expect their leadership to know what success actually looks like.
4. Underestimating change management needs: Executives are responsible for thinking constantly about the “why” and “what” of strategy, whereas the rest of the organization is focused every day on the “how.” As a result, executives are light-years ahead of their organizations in understanding what drives the need to change and why the change must occur to remain successful. Ignoring this foundational axiom of change management makes aligning employees and strategy nearly impossible.
5. Making the “why” implicit when it should be explicit: It’s risky to assume employees clairvoyantly understand their leaders’ intentions and interpret them clearly. As a result of the planning process, executives have hundreds of hours of data analysis and knowledge that employees who are removed from the process don’t have. These workers crave their leaders’ insight and confidence as to why the company will win.
6. Diluting the strategic message: No organization is more powerful than the one whose people are laser-focused on driving vision to reality. Unfortunately, leaders assume traditional communication channels are effective in disseminating this critical strategic information. However, our research has found that every organization has a “strategic dilution point” where there is degradation in the content and continuity of this message — typically three levels down from the CEO. The result? More than 80 percent of employees attempt to carry out strategy with reduced clarity and focus.
Companies that avoid this pitfall excel at two things. First, they empathically engineer messages to assist managers in delivering communication in their own, authentic voices while maintaining content integrity and accountability. Second, they create effective channels and venues to deliver this critical communication.
7. Holding rare and ineffective progress reviews: Successful organizations perform routine strategy self-examinations, often in the implementation phase, to assess progress, diagnose issues and make timely adjustments. A strong, ongoing review process consists of a dialogue rather than an inquiry and determines whether accountability is in place; whether milestones and metrics are being met; whether original assumptions from planning are still accurate; what is going well — and what is going poorly — and why; and how competitors are reacting to the strategy.
The greatest strategy will fail if not implemented as planned or not given time to prove its effectiveness. Great leadership devises strategies that are grounded in fact and not opinions, make implementation a priority and inspire confidence in those who carry them out. They put no less emphasis on the execution and alignment than on the planning itself. They help the plan move from the theoretical to the practical and from an intensive and resource-consuming event to a reflexive and ongoing part of the organizational culture.