Three decades ago, 90 percent of executives said they were successful at executing their business strategy. Today, that number is down to just 40 percent. WHY?
The good thing about change and advanced technology is that it speeds up processes and lets us make decisions faster.
The bad thing about change and advanced technology is that it speeds up processes and lets us make decisions faster.
When it comes to an organization executing on strategy, both statements are true. I addressed this conundrum in a recent FleetOwner IdeaXchange blog that stemmed from a speaker at one of our NationaLease meetings. Kathryn Brohman, associate professor at the Smith School of Business, Queen’s University, noted that executing on strategy is often so challenging that it ends up in failure. Then, what good is a strategy?
In my IdeaXchange blog, I list the questions companies should be asking when it comes to executing strategy. They also need to look at what changes can make that happen. I also enumerate “the five common causes of the execution gap.” Some of these are just a factor of human nature and the constraints of the bureaucracy:
- Complacency – being satisfied with the status quo. Not looking for new ways to do things
- Lack of authority – the people assigned to get the job done are not given the power to make it happen
- Misaligned incentives – the incentives provided are actually driving the wrong behavior
But then there are two others that come with the new technology landscape businesses face:
- Problematic KPIs – Companies today are buried in metrics. That should be helpful, if those metrics are analyzed properly. If you are measuring the wrong outcomes, KPIs can actually stand in the way of finding out whether your strategy is in place and working.
- Outdated technology – You are trying to achieve goals in today’s business environment without using today’s essential digital tools.
To go back to my statement at the top about 90 percent of executives 30 years ago feeling that their strategies were executed successfully, one has to look at the way businesses operated then. Companies were expected to post one-year, five-year, and ten-year plans. Businesses still do that, but they may not have the time to follow through. Technology and globalization have forced businesses to look at short-term goals first before they address long-term goals. And as you spend your time reacting to constant change instead of being proactive and working towards the future, your strategy (long-term strategy) can fall by the wayside. Companies must ensure that their tools and staff are able to keep pace with changes that occur. They must invest in digital technology and the talent to optimize the use of that technology.
Once you have the technology and staff in place, you still need to remember the human factors I stated above. And that is up to those in the C-suite to ultimately oversee. As Ms. Brohman said, “To execute will in today’s complex and dynamic world, leadership needs to spend less time tactically planning how the organization will get things done and more time identifying and removing execution barriers so people can do what you pay them to do.”
Read my full blog to discover what you should be doing to ensure your strategy is enacted successfully.