Robust Strategy + World Class Execution= Outstanding Results

There are a lot of organizations where strategy implementation fails because of  a combination of a lot of small issues across the organization. The thousand cuts inflicted by these small issues ensure that the implementation program bleeds to death.

For a moment let us only consider the internal environment within the organization. Let us discount the impact of the external environment like competitive action or a market condition. Any strategy implementation initiative encounters hundreds of small resistance/rebel teams at various levels within the organization.

The root cause of most of the rebellion  is that people & technology  do not want to change.

Managers want to protect their turf, customers want to stick to their old habits, salesmen want to safeguard their territories.Customers refuse to migrate to a new improved product line since they are comfortable with the features and services of the older version.

The customer  rebels against  strategists who takes him for granted. They revolt against organizations that  make a lot of assumptions on her behalf. Just because customer is buying wealth management services from a company  does not mean that she will buy travel related services. The customer  has a friendly  travel agent that she is very comfortable with. The customer rebels against the proposed idea of 'services supermarket'. Therefore what seems like a good diversification product strategy  fails to take off.

Then there is the 'rebellion of the employee'. No employee really wants to change unless there are strong reason and incentive for him to do so. A salesman used to selling a product might be compelled to sell a solution. However the salesman is not  sure of whether he is capable of doing  that. So he sticks to selling products. Similarly a salesman selling real estate is not happy  about selling mortgage to  customers (since the incentive is low). While cross selling and up selling  looks great on paper  it is difficult for the organization to execute the new sales strategy. 

Another rebellion  that takes a long while to  years to resolve is the 'rebellion of the IT system'. You might put a new purchase software with fancy reports but it refuses to talk to maintenance software. Hence inventory of maintenance spares cannot be updated real time. Or an HR software refuses to talk to the e-learning software.

So there are these hundreds of small rebellions  waiting to happen, once a strategy is ready for execution. Very often, the over-confidence at the strategy level (that stems from a grand new vision, a fascinating new product, a big merger, etc.) does not take into account the possibility of the occurrence of these rebellions.

While each rebellion in itself not be  worrisome, when put together they can bring the bright new strategy on its knees. It is very surprising indeed that instead of toning down estimates of sales on account of these rebellions, strategists over-estimate them. Instead of playing down  the possible cost savings or merger synergies, companies exaggerate them without accounting for resistance at various levels.

Who owns strategy in the organization?

It is the job of CEO to have a vision, to set a direction. In that sense, the CEO owns the strategy (on behalf of the Board of Directors, the ultimate owners). But the buck stops at the CEO anyways. The CEO owns everything and yet can never own anything completely. He is accountable for everything and yet cannot be completely responsible for it.
 
So an appropriate question to ask is perhaps who is responsible for strategy amongst the executive team? In a...