A leader's role in innovative strategy execution
15 May 2009 David Goldsmith
David Goldsmith explains to CEO how leaders are needed to communicate and execute an organisation’s strategy.
With the global economic downturn and tighter market competition, business leaders must develop innovative strategies that will keep their organisations profitable and in some cases survive. Today’s leaders must create and execute their strategies with a clear vision, precise communication, short- and long-term goals and a step-by-step marketing plan to attract the kind of organisational buy-in that will turn their ideas into profits. In order to successfully implement their strategies, CEOs and high-level executives must gain the support of their organisations.
When leaders and their executive teams take an active role in implementing strategies, this is a commitment to ensure the ideas or strategies become part of the organisation. Insightful leaders realise that for strategies to be successfully integrated into their organisations, they must align, measure, market and package the strategy to their business, customers and investment community as they would with any marketing campaign.
It is vital that communication is consistent and that leaders are involved in every aspect of the execution phases when putting innovative plans into action. Goal setting is another important element of the execution process. Several studies on why CEOs fail indicate that a main reason is not because of their strategies, but in their failure to successfully execute them. Below are the steps leaders must take to effectively align and develop an innovative marketing campaign that will allow them to successfully execute what they want to achieve.
Looping strategies with tactical tools
Before executing a plan of action, leaders must know how they can be most effective and creditable within their organisation, how they personally function as leaders and how they can best influence others to gain support and commit to their strategies. Leaders must clearly define and communicate their roles in the implementation process. For example, if a CEO's strength is dealing face to face with people, she will not want to spend time speaking in from of large groups.
In addition, they must have an awareness of the strengths and weaknesses of their executive and management teams. This knowledge will help leaders to establish and appropriately determine what role each member of the executive and management team must play in the execution process. A leader must also know the role every department must play, what will be expected, who will be accountable and what is to be gained. Leaders must align their own talents and skills with those of their executive and management teams for the implementation process to be as efficient as possible.
It is also essential to prepare for and examine all the possibilities for success and failure and what skills, talents and actions will be needed in any given situation. Leaders, executives and managers must constantly monitor, evaluate and perform progress checks to determine if their strategies are on track and to deal with negative surprises before they turn into critical set backs or derail the strategy. They must make sure that they are using their talent in the most effective and productive way possible. Strategies must communicate to the organisation where it is heading and what tactical tools will get them to where they need to go.
Gathering and sharing information
With the economy and markets changing at warp speed, leaders must know how to generate a steady flow of reliable information to help keep track of industry trends, changing customer needs and product cycles. It is imperative that CEOs and executives take a hands-on approach to develop sources that will provide a steady flow of trustworthy information. These sources of information can come from outside vendors, customers, industry experts and sales people.
When leaders, along with their management teams, have a steady flow of meaningful information, this will create insights into any changes that might need to be made to their strategies or execution plans. Also, by effectively managing information, leaders will be in a stronger position to identify potential problems or opportunities before the competition does. They will also be in a better position to know how to react and take advantage of the situation by creating the right kind of strategies and execution plans.
When leaders only establish one goal of increasing sales or profits, they are setting themselves up for execution failure. Goal setting needs to be done by using a step-by-step process that creates clear, understandable and obtainable short- and long-term objectives that will produce the best strategy execution results. Leaders who use their management teams in the goal setting process have a higher probability that the goals are realistic and obtainable.
By setting short- and long-term execution goals for each division, leaders will help create ownership between the execution process and what needs to be accomplished. Also, leaders who incorporate timetables into their goals will achieve the best results. Each manager needs to conduct meetings with their teams to obtain feedback and evaluate the progress being made in reaching their customised goals. Setting the right short- and long-term goals should not be taken lightly if leaders want to succeed at executing their strategies.
The flow and type of information communicated will play a significant role in how successful leaders will be in implementing their ideas throughout their organisations. It is imperative that the person delivering the messages is well respected and trusted throughout the company. A mistake that many leaders make is not keeping their people well informed about issues surrounding what they want to be accomplished. This is particularly true if the strategy is far reaching.
If workers are not kept informed, they will make up their own messages and stories in an attempt to fill in the blanks. This can cause the rumour mill to become the main source of information, causing leaders to lose control over the facts. Once leaders lose control over what messages are being communicated, this will have a negative impact on their ability to execute their strategies.
When directing communicating to individual departments, leaders must personalise their messages so that everyone involved understands how strategies relate to them and what role they play in accomplishing the desired results. It is imperative to visualise the final goal. The first step is to establish a message that will not only communicate what the strategy is meant to accomplish, but will get others to come together in support of the changes that will be taking place.
A good example of how important communication is in the execution process is McDonalds’ strategy message: ‘Plan to Win’. To complement this message, McDonald’s created five easy-to-understand drivers that directly related to the main message. These drivers clearly communicate what steps McDonald's needed to take for the ‘Plan to Win’ strategy to be successful. Next, it set a growth strategy, creating a message of ‘being better and not just bigger’.
The company communicated its strategy message through its annual report, website, company newsletters, corporate speeches and by its actions. Today, its customer satisfaction scores are on the rise; in 2008, McDonald’s achieved its sixth consecutive year of comparable same-store sales growth. Remember, even if a company has the greatest ideas, best products and brilliant concepts, without the right messages and communication plan it will be hard to get the kind of organisational buy-in needed to successfully execute the strategy.
To get maximum performance from department heads and line and project managers, leaders must put aside any personal agendas—real or perceived—and monitor how key employees are interpreting and communicating the goals and objectives to those who report to them. It is important that everyone is on the same page in the way they are communicating what is expected from their subordinates. In other words, the organisation must be moving in the same direction and doing what is necessary to produce the desired results.
Accountability and measuring processes
Leaders must put in place systems for how managers will be evaluated and held accountable for their execution performance. The systems should include a reward structure and what management practices are required to obtain such rewards. This information will help managers and their teams understand what actions will need to be taken, what will remain the same and what kind of changes will be required to successfully implement the strategies.
A well-defined plan outlining how success will be measured can provide clarification to both the organisation and managers on what direction they need to be headed in. It is important that the process by which managers will be measured is well defined and easy to interrupt. Measurement systems can be a tactical tool to create the right kind of actions, behaviours and focus that will help implement the strategy. Successful measurements that focus on what is important, what practices are needed, the strategy itself and how an organisation's culture must work will have the best opportunity to succeed. Without complete clarity, measurements can become counterproductive and produce results that were not intended.
To gain the necessary insights, leaders must conduct in-depth research within their organisations to find out what has worked in the past and why. If an organisation has a global presence, special care must be taken to ensure the research identifies differences that might exist from one culture to the next.
Leaders must recognise that making large-scale changes to an organisation and its culture is not an easy task. This is why leaders and their teams need to debate and examine what changes are truly necessary and if they can be done. A number of factors will influence an organisation's ability to change and accept new ideas. Such factors include maturity stage, openness to change, the relationship between management and workers, the overall design of the organisation, and its leaders' skills at implementing change.
It is the responsibility of leaders and their executive teams to set change priorities and to develop plans to help their organisations accept and adjust to the desired changes. Also, leaders must know how every department will be affected and who will be responsible for getting the right things done.
It is important that when leaders develop their strategy that it is aligned to the culture of the company. An example is an organisation that has a long history of producing high-end, quality products but in a difficult economy needs to reduce expenses. The culture of the company is based on pride in the quality of their products. If the leader has a strategy of reducing the cost of their product by 20% and takes the focus off quality, this might be disruptive to the organisation’s heritage and culture. It could result in the loss of good employees. On the other hand, if a leader approaches the same situation by challenging the organisation to produce the highest quality product possible at the needed price, this might produce the desired results without changing the deep history and culture of the organisation.
Making it work
Strategy execution is a complex process that cannot be taken lightly. Every strategy is different and will require a unique execution plan of action that will align the strategy to the organisation's culture, processes and structures. Leaders need to know the depth of their management teams and align what can be done with what needs to be done. Leaders who take a hands-on approach exert a higher level of influence over the execution process and can generate the kind of organisational buy-in needed to make the strategy take hold.