Structure Follows Strategy, in Strategy Driven Enterprise Organizations
Strategy execution represents a disciplined and systematic process of directing and controlling actionable/decisive decisions and activities that make an implemented strategy work resulting in the transformation of the organization and its institutions to strengthen it, and lead to sustainable growth and improved performance. Strategy execution requires the effective interplay of cooperation between strategic management and operations management in combining deliberate and purposeful actions demanded by the intended strategy from the strategic plan, and emergent strategy - as-needed reactions to unanticipated developments and fresh competitive pressures to realize the actual strategy.
Factors Influencing Execution Success/Failure
Strategies may fail at execution for a myriad of factors including the following:
All these factors are interdependent and their influences are non-deterministic, this typically, makes it very difficult for managers to comprehend the contribution of these factors to successful outcomes of strategy execution. If an organization fails to pay proper attention to one of these factors, it can result in execution failure, therefore an organization needs a system and approach to support management in successful execution.
How The Factors Influence Execution
Each of the factors influences execution success/failure in a different way; the following describes the myriad of ways these factors influence execution:
Complexity in the context of strategy execution refers to challenges/obstacles to understanding an issue due to lack of information and lack of insight into the problem domain due to:
Poor Leadership Style
Poor leadership is manifested in the failure of leadership to clearly communicate the reasons for the new strategy and garner the appropriate support to create consensus and enthusiasm/motivation in order to overcome any pockets of doubt and resistance to change resulting from successful strategy execution. In addition, poor leadership can be manifested in failure of leadership to orchestrate the processes and major initiatives as well as coordination of management and staff in properly performing their tasks to accomplish work.
A strategy may be defined variously as an approach to overcoming an obstacle; or a response to a challenge. A bad strategy is a strategy that does not define an approach/means to respond to a challenge (opportunity/threat) or solve a known problem. It reflects an organization's failure to face the problem. A good strategy is a mixture of policy and action designed to surmount a challenge/problem.
Poor implementation may result in weak strategic assets that do not close the strategic gap, and since execution takes place within the context of the implemented strategy, successful execution is unlikely.
Bad Strategic Decisions
Bad strategic decisions are strategic decisions whose outcomes result in business failure/decline. Bad decisions may result from incomplete or short-circuited decision processes.
Strategic decisions are among the main means through which management choices are actually realized. They are difficult or expensive to reverse because they substantially alter (and irrevocably so in the short run) the relationships between the decision makers' organization and customers, competitors, etc. The decision's outcomes are usually contingent on effects - the behavior of other actors affected by the decisions and outcomes. These recursive relationships between decisions, decision outcomes, and effects on other actors' behavior make strategic decisions messier and more complex than operations decisions.
Poor planning may lead to strategy execution failure resulting from: bad or unrealistic schedules for project team members resulting in waste of time and poor time management; lack of clear definition of strategy and project objectives; lack of budgetary controls leading to misuse of funds, etc.
Strategy Execution Model
The actual strategy of an organization is realized through combined execution of the intended strategy - what managers have set out in advance and intend to do - as part of some important strategic plan, and as-needed reactions to unanticipated developments and fresh competitive pressures to realize the actual strategy New circumstances always emerge, whether important technological developments, rivals successful new products introductions, newly enacted government regulations and policies, etc., that create enough uncertainty about the future that makes it impossible for managers to plan every strategic action in advance and pursue their intended strategy without alteration. Organizations need a system to support managers in influencing the effectiveness of planned actions (top-down) and as-needed adaptive reactions to unforeseen conditions ("unplanned" bottom-up strategy responses) in order to improve the likelihood of successful execution:
Strategy implementation is one of three co-incident processes involves in the strategy management. Strategy implementation provides the connecting loop between formulation and execution and control; Strategy implementation is key to any organization's survival; and requires the collaboration of everyone inside the organization, and on many occasions parties outside the organization. It is the responsibility of top, middle and lower/line managers focused on the creation of new strategic assets (capabilities and core competencies) and/or enhancing and strengthen existing strategic assets in order for the organization to maintain its ability to achieve future outcomes.
Challenges and Pitfalls to Successful Strategy Implementation
Strategy implementation presents an organization with challenges in effective strategic decision-making, and competencies in strategic management in a number key areas including:
All these challenges reflect factors that are interdependent and influence each other and, to varying degrees, the success/failure of strategy implementation.
Factors Supporting Effective Strategy Implementation
Effective strategy implementation and execution involves managing change in the organization's internal environment which then allows the organization to successfully adapt to the changing external environment in which it operates but cannot control. The key factors that support successful implementation and execution are the following internal environment elements:
These factors are generally in agreement with the key success factors or prerequisites for effective strategy implementation as identified by the McKinsey.
Factors That Support Successful Strategy Implementation
An organization must develop the capacity to effectively meet the challenges of successfully implementing a strategy due to influencing factors such as:
Failure to properly perform the leadership functions can lead to the following:
Information Availability and Accuracy
Inadequate information systems capacity leading to poor Information Flows and availability of accurate information to support fast and accurate progress tracking, timely intervention, and corrective action at the right time and place.may result in obstacles to successful implementation because of the degradation in certain management functions such as:
Uncertainty - Effects of Uncertainty
Uncertainty creates obstacles such as limited knowledge in current conditions and gaps in future outcomes, to decision-making such as:
The structure and operating principles as well as governance of the organization becomes more complex and critical to manage. Structure Alignment problems - the overall strategy not properly aligned (i.e., working) with the current structure; the way people and tasks/work are organized, and roles and responsibilities are assigned to people not aligned with strategy would lead to implementation problems. Weak structure can create obstacles to successful implementation manifested in the following ways::
The structure enables strategic alignment which enables effective cascading of objectives, goals, and decision rights to the appropriate people (actors) in the organization with the capability and capacity to perform the actions at the right time and place to accomplish the requisite goals and objectives.
Organization culture defines the particular way the organization solves problems of survival through adaptation to external environment and internal integration which is supportive of the strategy. Weak culture is by definition not supportive of the new strategy and leads to organizational behavior and performance problems that present obstacles and challenges leading to implementation failure manifested in the following ways:
Organizational culture can be supportive of the following: Learning and Development (Growth), Participatory Decision-Making, Power Sharing, Support and Collaboration, Tolerance for risk and conflicts.
Strategic Human Resource Management is particularly focused on the alignment of human resources as a means of gaining competitive advantage in terms of the adequacy of their knowledge competencies, and skills. Poor Human Resource Management is manifested in the following ways:
Technological trends include not only the glamorous invention that revolutionizes the lives of the actors in the organization and its environments, but also the gradual painstaking improvements in methods, in materials, in design, in application, unemployment, and the transportation and commercial base nd their diffusion into new industries and efficiency. The rate of technological change varies considerably from one industry to another.
Changing technology can offer major opportunities for improving goal achievement, or threaten the existence of the firm. Lack of organizational capability to adapt to technology changes is reflected in the conditions and gaps:
The factors that influence the successful implementation of a strategy are interdependent and their influences are non-deterministic it is typically very difficult for managers to comprehend the contribution of these factors to the successful outcomes of strategy implementation making strategy implementation very hard.
I am a computer scientist interested in modeling of complex business systems, and model-driven analysis and evaluation of strategic management and operations management and the interplay between them. Specifically, I am interested in the use of modeling to improve understanding of strategy, its formulation, implementation and execution, and the interplay between intended strategy, emergent strategy and leaning to inform better strategic decision-making.