Why Your Strategies Fail. Execution Matters!

Boris Reuter
March 12, 2021
Execution Management

Even though it's hard to pin down an exact percentage, research has shown that on average, about half of strategic initiatives fail to be executed successfully. For those conceptualizing strategies, this is, of course, a sobering statistic: this means half the strategic work you're doing is not leading to the desired results. In this article, we'll look at some of the reasons why strategic measures aren't executed, and help you ask the right questions to increase the impact of your strategies.

Why strategies fail

Intuitively, we all know this: great concepts, ideas and strategies alone don't work. Even if based on detailed analytics – it's the execution that matters. So, what are the reasons strategies fail? Some central themes reoccur, or cause issues in multiple areas, like communication, organizational culture, or management. However, being aware of these issues and building good habits will help you successfully execute your strategies. In the next paragraphs, we're discussing some of the key questions that can guide you.

What do we want to achieve?

This may seem like a redundant question, but it's not. For strategies to succeed in execution, it is vital to find the right levers. This implies a good understanding of the core competencies and business mechanics: knowing what areas to focus on, and what areas not to focus on – supported by an experienced management and good analytics. For execution to be successful, it requires a clear picture of what needs to change, where to start, and where to go, all with a defined timing, a clear scope and monitored by operational metrics.

How do we want to achieve our goals and strategies?

A logical follow up: how do we want to achieve these things? Here, the measures needed to achieve targets need to be clearly defined, featuring a clearly described action plan, responsibilities, and objects. They are of particular importance because the concrete, measurable change will happen on the object level, and make your measures tangible. Objects can be processes and organizations, or very concrete elements in your supply chain, such as slow-moving items.

How do we align ourselves?

When you're carrying out multiple measures throughout the organization alignment of targets becomes a necessary process, because contradicting, unrealistic or even too ambitious targets, let strategies fail. Communication is crucial in avoiding this: with good communication, you can manage expectations and goals to set. From this aligned goal setting, prioritization and more detailed task description and assignment follow. Therefore, it is vital to work out internal alignment leading to operationalized targets, as this will introduce a process where you critically evaluate set goals and adjust them if needed.

But: what do we align?

  • Starting with the basics: what 'alignment' means in your organization.
  • Task setting: what you need to do, how you will do it, and who will do it.
  • Goal setting: what good, realistic goals are, and how you will hold on to them.
  • Combining these three points: how you support alignment through the assigned tasks and set goals.

This shows us that process description matters and is essential. Documentation shows us what the concrete tasks at hand are, what stakeholders need to be informed, and what systems I need to log my actions in. Concrete tasks that help us align will help follow up on execution, and introduce countermeasures when necessary.

How do we remain disciplined?

Discipline is crucial for execution: you must carry out tasks springing from improvement measures with regularity. The many individual tasks that amount to an improvement initiative often aren't routine and therefore not intuitive, so it is essential to follow up on their completion. Thus, creating rituals can help bring regularity and discipline to tasks that aren't routine and build routine through ritual.

That is where most strategies fail, as follow up of the individual tasks is insufficient. But: discipline to follow this regularity can be stimulated by regular tracking of these tasks. Often, new improvement initiatives are already introduced before the previous was showing results. This blocks resources without harvesting success, creating frustration and missing the chance to control the effectiveness of measures and initiatives while learning from them.

How do we move in the right direction?

We have a certain expectation when it comes to the result of a measure reflected by operational targets. This needs to be transparently measured and reported so that you can steer when deviations occur. It's crucial to recalibrate measures based on deviations you identify, for instance through:

  • Sharpening the action plan, making tasks and descriptions more precise.
  • Adapting measures due to changes in underlying conditions.
  • Shifting resources where needed.
  • Reprioritizing.
  • Readjusting expectations.

Transparency is key. When you don't accurately report and measure, it becomes hard to measure success and identify what adaptions or realignments you need for improvement.

How do we learn and make the change sustainable?

Management, of course, is interested in knowing if their measures are successful, and want to answer the question: what do I need to do if they weren't successful? If you can't measure your strategic initiatives' success, you don't know what's working, and you may keep introducing new initiatives. This, as discussed, hurts sustainability, and may land you in so-called 'firefighting mode' where you experience the constant pressure to do something, without these initiatives and their tasks having the possibility to become ingrained. When the processes addressed in the previous paragraphs are followed; this makes a continuous improvement process possible and enables us to learn from measures and react to situations much faster.

This stops blind 'actionism' where, for instance, working capital management initiatives are carried out at the end of the year, every year. Better use of business resources would be setting up a sustainable optimization project, where you carry out measures routinely. When effective and transparent measures become a leading practice in your business, you will know which measures part of a strategy makes a difference.

When we think about why strategies fail and what you can do about this, the importance of transparency, alignment, and clear process description while defining concrete to do's immediately becomes apparent. It sounds simple, but it's execution management where most strategies fail.

AIO Impact can help you execute measures intelligently while providing you with the transparency that tells you what works. Download the AIO Impact brochure to find out more about its features and benefits!

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Meet the Writer
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Boris Reuter
Boris boasts over 25 years of experience in supply chain management and analytics across diverse industries. His passion lies in uncovering hidden insights within supply chains, leveraging cutting-edge algorithms to drive informed decisions and transform them into actionable results. As one of the pioneering minds at aioneers, Boris is dedicated to shaping the future of supply chain excellence.


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