Trust and the Relationship Between Strategy Formulation and Execution
Your strategy failed. It happens. And it’s OK, because you’ll recover from whatever the reason was. Maybe you underestimated the competitive challenges. You didn’t keep up with market changes. Customer service mistakes were made. Money was mismanaged or allocated in ways that didn’t line up with your initiatives. You raced to the bottom on prices instead of providing a better value to your clients. Any or all of those may contribute to a failure.
Surely your strategy wasn’t formed to put you into a tough spot. Your intention was success. It’s likely your plan was sound and you probably detoured in the execution. Wavering in discipline is a common mistake, and one easily fixed. The key is not only making the plan and sticking to it, but also remembering the differences between formulation and execution, even if they might seem contradictory at times. Let’s look at a few ways of illustrating them.
Strategy formulation generally needs only a few individuals. It involves a look at the moving targets of market forces and competitors. It’s also the structure of your management, deciding which goals the company will pursue in the next 1,5,10 years and finding the most effective ways to do it. To put it in other terms, formulation is creative, logical, observatory, high level planning, weighty decisions, setting goals, putting pieces on the game board in anticipation.
By contrast, strategic execution is getting things done. Coordination among everyone, top to bottom. The roadmap has already been created, so now you drive the roads according to the directions. Point A to point B. And you do it as efficiently as possible without going over budget. This is the phase where the capital has been spent and operations is takes over. So essentially, execution is action, creating motion, reaching goals, setting game pieces in into play according to the rules you’ve written.
So why is discipline in execution one of the more common mistakes? Think of the roadmap metaphor. You’ve created the map through your strategy formulation. You’re now executing, which is to say driving the roads that get you to your destination. Except that midway you start making small corrections, even shortcuts. A lane change here. A quick gravel detour there. All those small changes add up and eventually you’re a few miles off course. Had you kept your eye on the destination and followed the turn by turn, your trip would have been smoother and cost less.
There is more than contrast here. Strategy formulation and execution are interdependent. Once you’ve settled on a strategy, the only way to know if it works is to follow it, start to finish. It’s probably a good idea to keep going even when you get the urge to tinker. Redrawing a route at the driver’s level instead of the map creator’s level leads to a host of problems. Whatever your concerns, the overall strategy is still worth following. Keep at it.
Failure is how we learn, grow, and innovate. But growth only happens if we’re willing to set aside our egos and take a steely look into the reasons why we failed. Sometimes it’s intricate, complicated. Other times the failure is due to forces outside our control. More often it’s because we got nervous and forgot a few basics, leading us to make costly changes. And that’s OK. In the future, trust your roadmap. Trust your drivers. Keep moving ahead.
What are your plans and strategies? It is prime time for planning in many organizations as we approach the final quarter of the year. Share your suggestions and stories of success.