Most organizations are relatively good at strategic planning. Where they fail, however, is with Strategy Implementation. Currently, 60 to 70 percent of organizations do not achieve the results they intend from their strategic plans. Why? The truth is, most CEO’s don’t realize that they need to give the same kind of attention to strategy implementation that they give to the development of that strategy in the first place. The development process tends to be upward looking in terms of presenting a recommendation to the board, getting approval and then, as a CEO, being held accountable for achieving results. The main focus is on learning how to develop a plan that will advance the organization’s mission, whether it’s to become more competitive in the marketplace, create higher profits, or otherwise.
The CEO: Presenting a Plan and Working to Ensure Vice Presidents are Aligned with Strategy
Want To Learn More?
Contact Dwight today for a complimentary conversation on your organization and how your managers can improve their overall effectiveness.
Once strategy has been decided, it can be more or less transformative in terms of the impact it has on the organization. The CEO needs to be explicit about what he or she is personally accountable for delivering and the time frame and the specific milestones for each deliverable. That essentially becomes the CEO’s performance plan against which the board measures success. It also becomes the context for the CEO to work with the organization’s Vice Presidents in terms of CEO delegation so that each VP understands exactly what they must do and when to contribute to the success of the strategy.
The Importance of Setting the Right Context for Effective Planning
Often, the CEO incorrectly assumes that since the VPs worked closely to develop, fine tune and recommended the strategy to the board, and that they therefore should know what they need to do to implement it. The reality is, unless the CEO takes the time to break down the work of each VP along with relevant expectations, organizational drift will result. In the absence of the appropriate context set by the CEO for planning, including delegating and relevant expectations, each VP drifts in a different direction, relying on their own filters and focusing on their own strategic business units.
A Plan Provides the Framework for Staying Consistent With Strategic Direction
This is not a command and control situation, where the CEO says to the VP, “You must do X, Y and Z and when you finish, come back and we’ll talk about what you have done.” It’s about letting subordinates know about your plan, what you as a CEO need to accomplish and what is expected of each subordinate. Once this is done, and the necessary accountability and authority has been delegated, VPs can use their own judgment and take initiatives to do the work in the best way they see fit within the context that has already been set. The CEO needs to be informed, and of course, if there are roadblocks that haven’t been anticipated, he or she will assist. However, at the end of the day, the VPs are accountable for their own deliverables. The exact opposite of command and control is having a plan that provides the framework so that each VP works consistently within the organization’s overall strategic direction.
An Iterative Process Links Individual Work Back to Corporate Strategy
This process continues, as each Vice President does exactly the same with his or her Directors, who need to do the same with their Managers who continue the process with front line workers. This is an iterative process that links back to the overall corporate strategy, with each individual contributing to the efficiency and effectiveness of the entire system.
Documentation is Key
Each and every manager in an organization needs to have a plan. It doesn’t have to be as comprehensive as the organization’s strategic plan. In fact, it shouldn’t be, but it must exist. Managers need to be thinking about the specific piece of the business that they are personally accountable for and how to use available resources in the best way to ensure that the organization is meeting its overall strategy. Efficient use of metrics such as customer service, profitability and return on investment helps managers focus on those areas where they can have the most impact.
For strategy to be effective through development into implementation, each department has a role to play that needs to be presented in a well-crafted plan. By documenting the mission, including day-to-day work, deliverables and value-adding strategies, it’s easy to outline which aspects of work will be delegated to managers. This creates the context for them to do their work and help the organization reach its long-term objectives.
This is Part 2 of a 5-part series which delves deeper into “The 5 Requirements of Effective Managers.”