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Today I published a new episode of The World Class Leaders Show and I shared my lessons and insights about strategic planning.
(You can find the episode and summary at: https://www.andreapetrone.com/006-why-executives-are-failing-to-reach-their-strategic-goals/)
Here's why it's so important right now...
Many strategic initiatives fail because of poor implementation that leads to high costs, waste of time and resources, disengaged workforce.
According to experts, we’re experiencing a spectacular failure rate of strategy execution. In 2016, 67% of well-formulated strategies failed due to poor execution. Another research dated 2017 (global survey of 500 senior executives from companies with annual revenues of over $1 billion, by the Economist Intelligence Unit), 90% of executives admitted that they failed to reach all of their strategic goals because ineffective implementation of strategic initiatives.
Although leaders should focus on execution, I think they need to review their strategic planning process first. Here are some ideas:
Short-term vs Long-term Strategy
Not long time ago, I read on the news that a large firm published the new 6-year Strategy Plan. Well, I asked myself: how many things will change from now until 2027? And what about the CEOs? What about customers and the market? Given the turbulent time we live in and the fast-changing market scenarios, how likely will this plan be implemented?
It sounds predictable, but I’m always concerned when I see organisations spend months (and big money) to develop a strategy for so many years ahead. It might be a good plan per se and might look good for branding or marketing too, but the value stops there. It will end up on the shelves.
To me, a good strategy plan can’t be longer than one-two years. Ideally, the key priorities must be implemented in the next 12 months and keep additional 6-12 months as market validation period, where organisations can adapt and tweak the execution based on early results.
Outsource the brain power
Hiring external consultants to develop a company strategy brings a fresh view but also a number of issues in my experience.
To start, hiring strategy consultants might be very expensive and most often doesn’t result in successful implementation. They surely know how to develop a strategy, but they don’t know the company enough, the business, the culture.
In addition to that, their process could be invasive. They tend to come in and propose drastic changes but don't help much in the implementation. Therefore, once they disappear, it's up to the organisation make the new strategy happen. And this when problems often arise.
Finally and most importantly from a leadership development standpoint, I don’t think this is respectful for the employees. Hiring consultants for strategy is like to outsource the brain power. It doesn’t help engagement and people get very frustrated.
Too Many and Unrelated Priorities
Strategy is often a result of brainstorming sessions in the organisation. Company leaders look at trends, market insights, past performance, what worked and what didn’t, etc. etc. They’re looking for patterns to come up with strategies to implement.
This is ok, but often it results in a catch-up game, where leaders design an incremental strategy (so not really different than the past 3-4 strategy plans) which isn’t really either innovative or competitive. In this situation, leaders don’t focus much on the most important strategic questions to give their organisation an edge: customers, competitors and products/services.
Most frequently, the strategy plan ends up with buzzwords that mean nothing, and too many initiatives to implement across the entire organisation (positioning, new markets, sales distribution, IT, finance, ops, etc.) with unclear roles and responsibilities. This creates confusion and frustration.
Implement strategies without building a case
When I work with executives to help them to design and execute the best possible strategy to beat competition, the key element of our work together is to build a business case for each of the few selected priorities.
The business case is the key factor to get the initiative implemented. But before that, it needs to answer the most strategic question: why should this initiative be a key priority for the organisation? How will it help with the vision, mission, goals, etc. to grow the business?
If the initiative meets these requirements, it’s time to setup metrics for success and milestones to achieve. Issues need to be solved to allow teams to implement the initiative, required investments need to be defined, clear objections and resistance, set timeline and accountabilities.
Either used for corporate strategy or for units/functions, this approach is very effective, not only for implementing actions, but more importantly for focussing only on the most important initiatives.
Strategy has one goal. Win the game.
If you feel you’re planning or working on non-priority initiatives that won’t lead you to your overarching goals and beat the competition, it might be a good time to stop there and rethink your whole process.
To listen to the full episode on
P.S. If you feel stuck with your company strategy or for a specific area, get in touch. I have developed a three-step proven methodology to build a STRATEGIC and clear PLANNING and accountability process that gets everyone on the same page with no overlapping, shared accountabilities that create frustration, and allow your people to focus on the most important strategic questions to give your organization a strong edge and declutter non-priority initiatives.
Andrea Petrone
Leadership and High-Performance Advisor | Certified Executive and Neuroscience Coach | Facilitator | Speaker | CEC | MBA
London, UK
+44 7702518339
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