Many people will agree with Pete Laburn, strategy consultant and part of TomorrowToday’s network, that strategy just doesn’t work in most companies. Its either about just getting a plan done for head office, or we actually don’t have the time to lift our heads above the daily grind to see into the future. In this article, Pete argues that there is one dominant reason why strategies fail, and that is that the only strategy that organisations will deliver is the one that they are capable of delivering. He suggests three critical elements for developing organisational capability for implementing strategies.
In the many strategic sessions we run, we usually ask delegates “Who feels frazzled in their work?” Response to this question at is inevitably almost 100%. And when challenged as to why this happens, the usual answer is that ‘that’s the way it is today’. When pushed on just how enjoyable or satisfying their work is, delegates eyes glaze over, they shrug their shoulders, in apparent resignation that this is their lot in life, and the only possible way to cope in today’s world.
There seems little encouragement to lift their heads and to try and catch a glimpse of the new, fast changing world around them. Occasionally when offered the opportunity to get out of the ‘just do’ world, into the ‘think about the future’ world, they grab it, often in wide eyed amazement, with energy and enthusiasm, only for the brief interlude with the future to disappear, a day or two after returning back in the stifling office environment.
When challenging their superiors about why this happens, the retort is usually one of anxious frustration that they can’t keep up with demand, there are ever mounting pressures on them to just meet the current demands, they can’t retain staff and that to seriously think about the future is not possible at present.
There is little doubt that an obsession with short term focus, whether by choice or circumstance, is compounding the difficulties that organizations face in coping with this world of rampant paradox – where everyday is just head down, churn out what is expected, and a ‘don’t think, just do’ approach.
Sadly, many organizations who do spend some time in strategic sessions supposedly planning strategy, do so because head office requires a plan, or because they ought to do it, or have always done it. It’s kind of a ritual, an annual rain dance, that will hopefully this year bring new opportunity. And yes its true that many organizations often aided by skilled facilitators, do a reasonably good job of looking at their changing world, undertaking market research, doing a competitor analysis, talking about their perceived strengths and weaknesses in dealing with the threats and opportunities their market is presenting.
But all too soon, on returning to the office, it is back the grindstone, with the very best intentions, only to be overtaken by the 200 emails, and pressing demands and budgets to be met. Another question we ask is “what percentage of strategy that is strategized, actually gets implemented?” The answer is usually an alarming less than 10%. This seems catastrophic – why is the implementation rate so incredibly poor? With these results it would appear that the strategic process, whilst initially appearing useful, ultimately proves time consuming, probably somewhat expensive and delivering questionable value. Not what was anticipated.
All sorts of reasons are sited for this low implementation rate, with the finger usually pointed at changing market conditions, international competition, government regulations and new demands being placed on organizations. Why doesn’t the market respond normally and why can’t everything just be straight forward – like in the old days.
In reality there is one dominant reason why strategies fail to be delivered, and that is that the only strategy that organizations will deliver is the one that they are capable of delivering. And organization capability is a function of its structure, systems, governance, processes, culture, skills and above all talent. These are the capabilities that must deliver the strategy. These capabilities must in tune with, and even preferably ahead of the strategic goals set. Once they are aligned to your strategy you can happily send you strategy to you biggest competitor, because the sexiness of the strategy is not in the design, but in the ability to implement!
Anticipating the capabilities your organization will need for the future is as much the key to an effective strategic process as is the setting specific strategic goals. More than ever organizations should be anticipating the ‘conditions of engagement within their market 2 -3 years from now, and what capabilities will be required for strategic effectiveness at that time. The old definition of insanity suggests that “insanity is doing what you have always been doing and expecting a different result”. It seems that most organisations might well be insane, and they continue to address the new challenges with organisational capabilities that are frankly from the last century and very ‘industrial age’ in their design.
Three particular critical elements have come to the fore in building contemporary capabilities. The first is that strategically it is now more critical to decide what the organisation is not going to do, than specifically what it thinks it must do. Ill informed decisions now will create legacy systems, processes and thinking that may well limit the flexibility required to meet future demands.
The second is that strategic advantage is more than ever being driven by the human factor – the organisation that attracts, inspires and retains talent is well ahead strategically. And talent is smart, very quick to identify dynamic organisations, where forward thinking, capacity building and proactive strategies give hope for future organisational effectiveness in coping with the rapid change.
The third is that an organisation’s capability is primarily determined by the leadership – or lack of leadership. Proactive, forward thinking leadership will identify what capabilities are required in the future and put them in place ahead of time. They will take their stakeholders with them, communicating openly and deeply, and preparing them for the anticipated changes. They are likely to keep their organisations in a continual state of change, but within a clear strategic field, clearly identifying what is ‘out of play’ on their strategic journey. Weak or non existent leadership, as so often typified by short term management obsession, will not proactively address the future capabilities needed, and thereby plunge their organisation into facing one crisis after another. This is a zero sum game.
Developing appropriate organisational capabilities and leadership are crucial elements of the strategic thinking process, requiring as much focus on, and interpretation of the rapidly changing world as the strategy formulation does. Strategic thinking is a holistic process, an ongoing journey, a vital dynamic enabling tool for organisations when given the appropriate time, focus and energy.