Top 10 Reasons Strategy Execution Fails (Part 2)

Top 10 Reasons Strategy Execution Fails (Part 2)

June 11, 2018 Strategy
Top 10 Reasons Strategy Execution Fails (Part 2) -

“Almost Half of all Strategic Initiatives Fail Due to Poor Execution”

Economist Intelligence Unit

This is the second article on this subject. Please refer to last month’s newsletter for Part 1

5. Employees are not engaged and committed to the strategy

Strategy development and execution needs to be a collaborative process. Managers that will be responsible for the achievement of the strategy’s objectives need to own the strategy. It needs to be their strategy…not some consultant’s strategy. Without buy in, the strategy will be dead on arrival. Involve your managers in all strategy discussions. Create an environment where strategy becomes a part of everyone’s day-to-day responsibility.

“Our research reveals that, on average, 95% of a company’s employees are unaware of, or do not understand, its strategy”  

Harvard Business Review

6. The budget is not aligned to the strategic plan

The annual budget process is rarely aligned with the 3-year plan. The reason for this is because the budget and the strategy, have different timelines, and are rarely integrated. Also, the annual budget is geared up to feed the existing machine and based on prior year run rates.

The result is the all-too-familiar “use it or lose it” spending attitude at the end of the year, and their new budget looks a lot like the old budget, which can hardly lead to breakthrough results.

7. Employee incentives are not aligned to the strategic plan

The whole purpose of strategic plans is to dramatically improve performance within a company. However, once the plan is issued, most employees go back to work and end up doing the same work they’ve always done. By exclusively rewarding employees for current year P&L performance, an opportunity is missed to change the culture. For example, if delighting the customer is at the core of your company’s strategic plan but employee incentives to boost customer satisfaction are negligible or missing altogether, the frontline staff has little or no incentive to change what they do on a daily basis. Aligning everyone in your organization with your strategy is one of the most important things you can do. Without it, every bit of forward motion is a struggle.

This approach reminds me of a quote often attributed to Albert Einstein, “The definition of insanity is doing the same thing over and over and expecting different results.”

8. The executive team spends less than an hour a month discussing the strategy

“Our research suggests that 85% of executive leadership teams spend less than one hour per month discussing their unit’s strategy, with 50% spending no time at all”

Harvard Business Review

This is generally due to the inability to separate business as usual BAU from strategy and being too internally focussed. You must be disciplined to look outside of your business. Companies that manage strategy execution well, behave differently. Top managers usually meet once a month for four to eight hours. This meeting provides the opportunity to review performance and to make adjustments to the strategy and its execution. A critical question to ask at these meetings is “what have we learned in the last 30 days that effects the future of our business?”

9. Lack of clarity

Your strategic plan should clearly articulate your market identity: who you will serve and who you won’t, what capabilities you will be disproportionately better at than your competitors, and why your target customers will choose you over competitors.

Also, there should be absolute clarity around the 3Ws. This is not a reference to the world wide web but to Who is doing What by When and how you will hold them accountable to deliver and what is the price of failure.

 10. Do not make enough decisions

In Part 1, I used this definition of execution: “the result of thousands of decisions made every day by employees acting according to the information they have and their own self-interest”.

It follows that decision making is a crucial element of execution as is the availability of the right information. Meetings should be primarily focussed on decision making. Adopt a Continuous, Decision Oriented Planning model. Make more decisions. Make faster and better decisions and address the key issues. Do not procrastinate

So, what will make you successful? Sadly, there is no silver bullet. It is mostly down to the choices you make, what you focus on, how disciplined you are and how you energise your organisation to make it happen. Keep your word, live by your values. Exercise your will power muscle, learn how to delegate and help people take ownership of commitments.


“Well done is better than well said”

Benjamin Franklyn


“Do. Or do not. There is no try.”

“Already know you that which you need.”

Yoda, Jedi Master


Phil Kerrigan

Senior Strategist &  Executive Business Coach


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