Issue 4.7 | January 2014
In this Article: how to build a strategy that won’t fail on execution.
by Jonathan Wilson
Nearly twenty years ago, I did a somewhat unkind thing to a man who (I did not realize at the time) was later to become an important part of my life. Along with a small team of Canadians, he was with me in Papua, Indonesia, to visit the Yali tribe. It was intended to be an educational opportunity as well as a bit of an adventure. Having spent most of the first seventeen years of my life growing up in Papua, I had explored, hunted and played in mountainous wilderness as any child in Canada plays in their suburb or at least in their basement and on their Xbox. And I took advantage of this familiarity in a bit of a mean way.
At one point we undertook a fairly arduous hike through the mountains, passing through forests and villages along the way. Descending from a 9000ft (2743m) pass we had just crossed, we stopped by the crystal waters of a tumbling stream shrouded by great overhanging boughs covered in mosses. Here we drank from the chilly water. I turned to my friend and said, not entirely innocently, “I’m going to drink a bit more, why don’t you keep going and I’ll catch up?”
While it was entirely obvious to me where the trail went, it was not at all obvious to my Canadian friend. “Which way do I go?” he asked. “Oh, that way,” I waved vaguely. I turned back to the stream.
After quenching my thirst, I turned to see the poor fellow ascending a section of scree that rose in quite the opposite direction of the actual trail, whose barely discernable path disappeared into the forest and followed the descending course of the stream. When I called him back, my companion’s indignant appearance suggested he recognized he’d been the object of my amusement. So it is a sign of his gracious character that we later became close friends and he honoured my wedding as the best man.
Too often, business strategies are to employees like paths in the rainforest are to a city dweller. Assuming your strategy has imagination and vision, it is taking your company into a place it has never been before. This is challenging enough. But the primary reason most strategies fail is not tactical (which I deal with elsewhere). It is because they send people down a trail that is simply not clear enough to follow without constant assistance.
Here are five marks of a strategy that will be hard to fail because it is easy to follow:
1. It is Precisely Focused
The majority of strategic plans I encounter are, rightly, built around a handful of priorities. Often, these priorities are well-conceived and genuinely strategic. However, every strategy has, at its heart, one – and only one – ultimate goal. In some way or other, that goal has something to do with the world of the customer. Any further outcomes – such as shareholder returns – measure the achievement of that main goal. Any subordinate outcomes lead towards that goal.
Many companies use a Balanced Scorecard method. This builds a strategy around four standard major outcomes – learning and growth, operations/processes, finance, and customer satisfaction. None of these four areas make sense in isolation – none makes for a worthy goal on its own. They are all being pursued for a greater reason or purpose. It is that one purpose a strategy must clearly articulate. An employee can only be as focused as the strategy they follow.
2. It is Utterly Rational
If the ultimate focus of a strategy is not built on unassailable logic, it is vulnerable to constant questioning, fiddling, and re-invention at every level of the organization. It is guaranteed to fail on execution. It has to be truthful: about the company, about the market, about what’s possible.
3. It Matters More Than Anything Else
If the ultimate focus of a strategy doesn’t truly matter – if it doesn’t have a morally robust centre focused on the improvement of lives – it will not engage the hearts and minds of your people. It has no urgency. It can wait till tomorrow. It will not call up their deepest resources of creativity and insight. Nor is it sustainable. A strategic focus that is deemed both intelligent and worthy is like a hot, slow-burning fire that won’t go out, even when the occasional cold waters of market upheavals or competitor tactics splash on it.
4. It is Simple with Clear, Causal Logic
No strategy needs to be complicated. That will happen quickly enough once implementation begins. Instead, the overall strategic focus should be supported by 4-5 subordinate priorities, each of which covers off a strategic component of organizational performance (as the Balanced Scorecard method does). There needs to be a clear, cause-and-effect logic running through each area of the strategy, leading directly to the ultimate outcome.
A strategy like this can be described on a napkin with simple “if-then” language. It can be hung in boardrooms and in the cabs of the truck drivers in your supply chain. It is simple and clear enough that ordinary, daily decisions can be assessed against it.
5. It Contains Room for Initiative
A strategy is not simple or clear enough if it dictates exactly how each business unit or team should execute on it. Such a strategy will suffocate initiative and creativity. It will shut off the rich oxygen supply of area-specific insight and skill that individuals and teams are best positioned to bring to the execution of the strategy. A healthy strategy is clear on expected outcomes and clear on operational principles, but does not give explicit direction on how to execute it in every area. Over-directed employees can only be held accountable to transactional performance, and not to outcomes performance.
A rigorously thought-through, morally impassioned but simple strategy provides a clear path for every employee into otherwise uncharted territory. Its heart will earn their loyalty, its logic will help them stay the course, its simplicity will give them clarity as the environment becomes less familiar. In time, they will deliver the outcome that really matters.
Another leadership insight from www.leadbysoul.com.
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Photo © Jonathan Wilson, All Rights Reserved. Caption: Papuan man on rainforest trail.