Blog 39: Strategies require proper execution to be effective

Most companies admit they struggle with strategy execution (a HBR study).

Good execution is based on four building blocks:

1. Clear sense of decision making responsibilities

   1. Specify who owns each decision and who must provide input

2. Smooth information flows

   1. Ensure information flows where it’s needed

3. Alignment of motivators

   1. Right set of motivators in place

4. Efficient Structures

   1. Flexible organisation and structures

As per HBR research, the first two blocks (decision rights and information flows) are far more important – about twice as effective as the other two.

Firms with strong execution have 17 common traits:

1. Everyone has a good idea of the decisions and actions for which he or she is responsible. [BUILDING BLOCK1: DECISION RIGHTS]

2. Important information about the competitive environment gets to headquarters quickly. [BUILDING BLOCK2: INFORMATION]

3. Once made, decisions are rarely second guessed. [BUILDING BLOCK1: DECISION RIGHTS]

4. Information flows freely across organisational boundaries. [BUILDING BLOCK2: INFORMATION]

5. Field and line employees, usually have the information they need to understand the bottom-line impact of their day-to-day choices. [BUILDING BLOCK2: INFORMATION]

6. Line managers have access to the metrics they need to measure the key drivers of their business. [BUILDING BLOCK2: INFORMATION]

7. Managers up the line get involved in operating decisions. [BUILDING BLOCK1: DECISION RIGHTS]

8. Conflicting messages are rarely sent to the market. [BUILDING BLOCK2: INFORMATION]

9. The individual performance appraisal process differentiates among high, adequate, and low performers. [BUILDING BLOCK3: MOTIVATORS]

10. The ability to deliver on performance commitments strongly influences career advancement and compensation. [BUILDING BLOCK3: MOTIVATORS]

11. It is more accurate to describe the culture of this organization as ‘persuade and cajole’ than ‘command and control’. [BUILDING BLOCK1: DECISION RIGHTS]

12. The primary role of corporate staff here is to support the business units rather than to audit them. [BUILDING BLOCK1: DECISION RIGHTS]

13. Promotions can be lateral moves. [BUILDING BLOCK4: STRUCTURE]

14. Fast-track employees can expect promotions more frequently than every three years. [BUILDING BLOCK4: STRUCTURE]

15. On average, middle managers here have five or more direct reports. [BUILDING BLOCK4: STRUCTURE]

16. If the firm has a bad year, but a particular division has a good year, the division head would still get a bonus. [BUILDING BLOCK3: MOTIVATORS]

17. Besides pay, many other things motivate individuals to do a good job. [BUILDING BLOCK3: MOTIVATORS]

Jump to blog 100 to refer to the overall product management mind map.

Source: Book - HBR’s 10 Must Reads on strategy

All the best! 😊