January 24, 2016

Planning and Execution - Theory and Practice



Based on Making Strategy Work: Leading Effective Execution and Change By Lawrence G. Hrebiniak
Google Book Preview of the title


Making strategy work is more difficult than the task of strategy making

Execution is critical to success. Execution represents a disciplined process or a logical set of connected activities that enables an organization to take a strategy and make it work. Without a careful, planned approach to execution, strategic goals cannot be attained.

Execution represents a formidable challenge to management. Execution function of the management has to take into account a host of factors, including politics, inertia, and resistance to change.


Managers still don't know a great deal about the execution of strategy. Management literature has focused over the years primarily on planning and strategy formulation and neglected execution.

The execution of strategy is not nearly as clear and understood as the formulation of strategy. Much more is known about planning than doing, about strategy making than making strategy work. There is lack of education and training in execution. Some of  the problems or hurdles affecting implementation or execution are:


Managers Are Trained to Plan, Not Execute


One basic problem is that managers know more about strategy formulation than implementation. They are trained to plan, not execute plans.

In most MBA programs, students learn a great deal about strategy formulation and functional planning. There are courses on competitive strategy, marketing strategy, financial strategy, and so on. Courses dealing  execution or implementation are absent. Execution is  certainly touched in some integrated courses in management, but not in a dedicated, elaborate, purposeful way. Emphasis clearly is on conceptual work, primarily planning, and not on doing. At Wharton, there is at least an elective on strategy implementation, but this is not typical of many other MBA programs.


Most MBA programs emphasize developing strategies, not executing them. In the real world, e many managers have rich conceptual backgrounds and training in planning but not in "doing." The lack of formal attention to strategy execution in the classroom obviously must carry over to a lack of attention and consequent underachievement in the area of execution in the real world.  Therefore execution has to be  learned in the "school of hard knocks," and its results in more failures. .




Attitude Problem: Let the "Grunts" Handle Execution


Another problem is that many managers actually believe that strategy execution or implementation is "below them," something best left to lower-level employees. The prevailing view  is that one group of managers does innovative, challenging work (planning) and then "hands off the ball" to lower levels for execution.

Every organization, of course, has some separation of planning and doing, of formulation and execution. However, when such a separation becomes dysfunctional—when planners see themselves as the smart people and treat the doers as lower level —there clearly will be execution problems. When the "elite" plan and see execution as something below them, detracting from their dignity as top managers, the successful implementation of strategy obviously is in jeopardy.

From the CEO on down, sound execution demands that managers roll up their sleeves and pitch in to make a difference. The content and focus of what they do may vary between top and middle management. Nonetheless, execution demands commitment to and a passion for results, regardless of management level.

Another way of saying this is that execution demands ownership at all levels of management. From C-level managers on down, people must commit to and own the processes and actions central to effective execution. Ownership of execution and the change processes vital to execution are necessary for success. Change is impossible without commitment to the decisions and actions that define strategy execution.

The execution of strategy is not a trivial part of managerial work; it defines the essence of that work. Execution is a key responsibility of all managers, not something that "others" do or worry about.

Planning and Execution Are Interdependent


Planning and execution tasks are highly interdependent. Planning affects execution. The execution of strategy, provides inputs to future planning.  This relationship between planning and doing suggests two critical points to keep in mind.

Successful strategic outcomes are best achieved when those responsible for execution are also part of the planning or formulation process. The greater the interaction between "doers" and "planners" or the greater the overlap of the two processes or tasks, the higher the probability of execution success.

A related point is that strategic success demands a "simultaneous" view of planning and doing. Managers must be thinking about execution feasibility and ease even as they are formulating plans. Execution is not something to "worry about later." While all execution decisions and actions cannot be taken at once along with the plan, execution issues or problem areas must be anticipated, however, as part of a "big picture" during  planning. Formulating and executing are parts of an integrated, strategic management approach. This dual or simultaneous view is important.


Execution Takes Longer than Formulation


The execution of strategy usually takes longer than the formulation of strategy. Whereas planning may take weeks or months, the implementation of strategy is usually played out over a much longer period of time. The longer time frame can make it harder for managers to focus on and control the execution process, as many things, some unforeseen, can materialize and challenge managers' attention.

Steps taken to execute a strategy take place over time, and many factors, including some unanticipated, come into play. Interest rates may change, competitors don't behave the way they're supposed to, customers' needs change, and key personnel leave the company. The outcomes of changes in strategy and execution methods cannot always be easily determined because of "noise" or uncontrolled events. This obviously increases the difficulty of execution efforts.

Long-term needs must be translated into short-term objectives. Controls must be set up to provide feedback and keep management abreast of external "shocks" and changes. The process of execution must be dynamic and adaptive, responding to and compensating for unanticipated events. This presents a real challenge to managers and increases the difficulty of strategy execution.


Execution always takes time and places pressure on management for results. But the longer time needed for execution also increases the likelihood of additional unforeseen problems or challenges cropping up, which further increases the pressure on managers responsible for execution results. The process of execution is always difficult and sometimes quarrelsome, with problems only exacerbated by the longer time frame usually associated with execution.

Execution Is a Process, Not an Action or Step


Execution is a process. It is not the result of a single decision or action. It is the result of a series of integrated decisions or actions over time. Execution is a process that demands a great deal of attention to make it work. Execution is not a single decision or action.

Execution Involves More People than Strategy Formulation Does

In addition to being played out over longer periods of time, strategy implementation always involves more people than strategy formulation.  Communication down the organization or across different functions is a challenge. Making sure that incentives throughout the organization support strategy execution efforts becomes a necessity and, potentially, a problem. Linking strategic objectives with the day-to-day objectives and concerns of personnel at different organizational levels and locations becomes a legitimate but challenging task. The larger the number of people involved, the greater the challenge of effective strategy execution.


Obstacles to Strategy Execution - Survey Results


Wharton-Gartner Survey (n = 243) and  Wharton-Executive Education Survey (n = 200)



1. Inability to manage change effectively or to overcome internal resistance to change
2. Trying to execute a strategy that conflicts with the existing power structure
3. Poor or inadequate information sharing between individuals or business units responsible for strategy execution
4. Unclear communication of responsibility and/or accountability for execution decisions or actions
5. Poor or vague strategy
6. Lack of feelings of "ownership" of a strategy or execution plans among key employees
7. Not having guidelines or a model to guide strategy- execution efforts
8. Lack of understanding of the role of organizational structure and design in the execution process
9. Inability to generate "buy-in" or agreement on critical execution steps or actions
10. Lack of incentives or inappropriate incentives to support execution objectives
11. Insufficient financial resources to execute the strategy
12. Lack of upper-management support of strategy execution



Based on the discussion of survey results, the author provided the following steps for achieving the success of execution.

1. Developing a model to guide execution decisions or actions

2. Understanding how the creation of strategy affects the execution of strategy

3. Managing change effectively, including culture change

4. Understanding power or influence and using it for execution success

5. Developing organizational structures that foster information sharing, coordination, and clear accountability

6. Developing effective controls and feedback mechanisms

7. Knowing how to create an execution-supportive culture

8. Exercising execution-biased leadership



References

Full article
http://www.ftpress.com/articles/article.aspx?p=360437


Seven Strategy Questions: A Simple Approach for Better Execution

Robert Simons, Professor, HBS
2010
https://books.google.co.in/books?id=tIYrly9QjTIC



Revision/Review article on Strategic Management


Crafting and Executing Strategy - Book Information and Chapter Summaries




“many people regard execution as detail work that is beneath the dignity of a
business leader. That’s wrong— it’s a leader’s most important job.”



CEOs and their leadership teams say excellence in execution and consistent execution are their top two
challenges, according to a recent Conference Board study (2008)
https://www.pwc.com/us/en/people-management/assets/execution-focused-leadership.pdf
.



Updated 24 Jan 2016,    16 Sep 2015, 12 Sep 2015

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