Adventure of Strategy

One of the most serious problems hindering strategy is the inherent lag in 'clock speed' between the rate of change in the market; the rate at which a firm can formulate a strategic response to those changes; and the rate at which the firm can implement the changes necessary to execute the strategy. (See diagram below.)

Here are ten things that a firm can do to increase clock speed in strategy execution:

Click image to enlarge

THE PROBLEM WITH STRATEGY EXECUTION IS OFTEN THE DIFFERENCE IN 'CLOCK SPEED' BETWEEN CHANGES IN THE MARKET, FORMULATION OF A STRATEGIC RESPONSE AND THE FIRM'S ABILITY TO EXECUTE THAT STRATEGIC RESPONSE

1.Formulate Strategy with Execution in Mind

Firms with high execution clock speeds do not treat strategy execution as something separate from the actual strategy, to be addressed only once this has been decided. How strategy is to be executed needs to be a specific and integral part of the process of formulating it. In other words: "What do we aim to achieve?" is a question that needs to be asked in tandem with "How would we achieve this?" That way, problems that may arise (eg with resources, culture or other capabilities) can be considered early enough for something to actually be done about them. At its pinnacle, this approach leads to strategy formulation and execution becoming an ongoing, iterative process.

2.Broaden Participation in Strategy

Including a wider range of people in the process of strategy formulation, even people that would not necessarily typically be involved, has three advantages:

a.It raises the general "Strategic IQ" of people in the firm overall, broadening the range of people in the firm that think strategically.
b.It brings in fresh ideas and encourages innovation.
c.It improves the focus on execution, as opposed to goals alone.

Excluding people because "they don't know nuthin' about strategy" means, unsurprisingly, that those people continue to know nothing about strategy.

3.Design Strategy as a Road Map, not a Rigid Plan

Strategy that is designed with the end in mind, allowing for flexibility in how that end may be achieved, is far more likely to be successfully implemented than a rigidly enforced plan that needs to be formally amended every time a change is needed. Firms with high execution clock speeds are very clear indeed about where they intend going and within what boundaries the trip will occur. They are far less rigid about the specific details (at the strategic level) of how the firm will make that journey. Detail is decided at the tactical level.(See point 6.)

4.Delegate Real Authority and Accountability

Once the end has been defined, as well as the limits within which the firm will operate in moving towards that end (e.g. values, financial limitations, structural and systematic boundaries,) delegate authority for determining the tasks involved in strategy execution as deep into the firm as makes sense. Firms that require all decisions to be ratified by the management committee typically have far slower execution clock speeds than those that trust their mid-level managers. Along with trust, of course, needs to be accountability for results.

5.Over-Communicate

Firms with high execution clock speeds typically communicate continuously about their strategies, in "strategic conversations." These conversations, which are both top-down and bottom-up, as well as across functions, typically comprise a continuous stream of discussions, usually informal, that underpin the formal strategy process. They are an indicator of high "Strategic IQ" and typically just "happen," as part of the fabric and culture of the firm, rather than being actively planned. It is also particularly important for messages about aims and boundaries to be communicated loudly and frequently, from the top.

6.Focus Action on the Short Term

While strategic objectives may be aimed over a time frame of several years, and plans may even straddle a year or more, the firms with the highest execution clock speeds have an action orientation where the focus is primarily on what people should be doing NOW! In other words, action plans are focused on the next week or month; no more than the next quarter. The plans detail who (specifically) is responsible for each action, what resources are to be deployed, and how success or failure will be measured.

7.Encourage Risks; Tolerate Mistakes

A culture where mistakes made in good faith are punished slows execution clock speed. It also slows organizational learning and discourages innovation. (Such mistakes would exclude obvious negligence or overstepping the communicated boundaries.) Where mistakes are acknowledged and then constructively 'mined' for lessons learnt, the execution clock speed accelerates.

8.Get Good at Simplification

Today's market is so complex, and there are so many inter-related factors that influence strategy, that the ability to get quickly to the nub of an issue is an essential skill for a strategist. Those leaders that can simplify complex issues to the point where their people can (a) understand them and (b) act on them, are far more successful as leaders of professional service firms, than those that get bogged down on trying to consider every possible facet of those issues.

9.Think Scenarios, not Predictions

The future is too complex to accurately predict. It is pointless trying. What can (and should) be done is for firms to consider a range of possible eventualities and how well (or not) their strategy would measure up were these to occur. This leads to a far more flexible approach to strategy which, in turn, increases execution clock speed.

10.Make Resilience and Flexibility Strategic Goals, in Themselves

Firms that focus on continually improving their bench strength, reserves, client relationships and other aspects of resilience and corporate health and well-being have far higher execution clock speeds than those that focus on these important issues only at a tactical level.

Comments, as always, are most welcome and may be posted below.

Rob: This is not a comment for publishing unless you want to. It's been great finding and reading your site. Just an FYI - I'll be doing a 4 part series on the "strategy clock time" idea on September 25, 27-9. If you've read much of my stuff, you'll know that I heavily link back and footnote all references. Thanks.

-Dubs