A great strategy is not enough for a company to be successful. In fact, according to research done by Robert Kaplan and David Norton, the creators of the Balanced Scorecard performance management tool, nine out of ten companies fail to execute their strategies.
To be successful a company needs to have both the right strategy and great execution (implementation) of that strategy. Furthermore, it needs a team comprised of the right people all working in alignment towards a common purpose and goal.
To increase the chances of successful execution of your business strategy, I suggest following these three principles.
- Keep it simple. Your strategy must be simple to communicate effectively to your team and the entire company. Everyone needs to understand what is the plan; what are the specific objectives, and what they need to do in order to make it happen.
- Focus. You need to maintain the company’s focus on its goals and priorities, as articulated in the strategy. You should avoid frequent changes to your objectives and priorities unless your key assumptions or market environment have changed drastically. For example, changes in regulation, new competitive threats, changes in your target customers, etc. Frequent changes have an adverse effect on execution and employees’ trust in the leadership team.
- Strategic Discipline. This means avoiding other opportunities or distractions that always come up, and sticking to your chosen path and targets. And yet, you should constantly review your progress and assumptions to make sure that your plan is still relevant. You should not change the plan simply because a new opportunity came along.
Finally, to quote Morris Chang, CEO of TSMC: “Without strategy, execution is aimless. Without execution, strategy is useless.”