Five Barriers to Executing Your 2003 Plan...
   and Proven Methods to Overcome Them

Bob Zagotta

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You may be familiar with Dwight D. Eisenhower’s quote, “Plans are useless; planning is everything.” The reason this quote resonates with so many of us in business is because we have all learned (some of us the hard way) that execution -- more so than planning -- is the battleground that determines success and failure. The function of planning should be thought of as much more than simply a means to generate plans and budgets. It should be thought of as a process that builds clarity and alignment, and positions the organization for efficient and effective execution.

Annual Planning: Powerful Management Tool or Exercise in Bureaucracy?

Each year the average organization spends 20,000 person hours in planning, budgeting and forecasting for every $100 million in annual revenue (source:The Hackett Group). With an investment of this magnitude, it would follow that most companies expect significant results from their plans.

Unfortunately, this is often not the case. The ability to bring together people, strategies, and operations to drive results evades even many seasoned management teams. Based on experience with over 50 companies on the topics of strategy, planning and execution, it is evident that the most critical barriers to successful execution typically fall into the five categories described below.

BARRIER #1 The Underlying Strategy is Not Clear

Surprisingly, in the vast majority of both large and small companies the basic strategy of the organization is not clear. Confusion ranges from “fuzziness” in direction to silent conflict in the executive ranks to a breakdown of understanding among managers and employees. It is estimated (source: Fourth Floor Study - 2001) that in most organizations:

• 36% of executives acknowledge a lack of clarity and/or consensus regarding overall strategic direction

• Up to 85% of employees have never been exposed to the strategy or plan in any form

• 68% of executives agree that day-to-day fire fighting inhibits focus on longer-term strategic priorities

These situations can have a direct effect on the organization and its ability to execute.

A strategy represents a set of decisions regarding the future and how the organization will ultimately be successful. Without a crisp articulation of these decisions, the organization -- most particularly the executive team -- must continually reinvent those decisions every time a new idea, opportunity and/or problem arises. This results in endless meetings, hallway conversations, email threads and ultimately missed opportunities while perpetuating a culture of indecision and inefficiency. In addition, organizations in this condition experience dramatically lower returns on executives’ time, one of the most precious resources and important assets of any company.

Consider a somewhat tired, but telling example:

A group of people is planning a road trip from Chicago to Los Angeles. To be effective and build assurance that they will achieve their goal, they could decide on their “strategy” for the trip upfront. Do they want to focus on efficiency and arrive as quickly as possible? Perhaps beautiful scenery is the priority. What about access to comfortable lodging or frequency of historical landmarks? The possibilities are endless.

Without an upfront discussion and set of agreements, there will be many, many conversations (and quite possibly arguments) about route, schedule, and approach. The vacuum that is left without common understanding and perspective is inevitably filled by politics and emotion: one day Bill’s point of view (or obsession or habit or ax to grind) prevails, the next day Sally gets her way. The route becomes circuitous, particularly confusing to anyone who may be trying to follow. In this situation, achievement of the goal (get to L.A.) may also be compromised.

The same situation happens in many businesses. A lack of clarity and agreement regarding the fundamental direction of the organization creates a void where personalities, politics, and one-upsmanship prevail. In addition, fundamental disagreements are seldom understood well enough to be tackled directly. They are instead played out in hundreds of fragments of daily conversations and emails about whether to attend this tradeshow or that one, or what the brochure should say, or what initiative is the priority at that moment. Although the direct effect is diluted progress, there are many other costly repercussions such as manager and employee frustration, missed opportunities, and loss of competitive edge.

CASE EXAMPLE: FORTUNE 50 MANUFACTURING COMPANY

We recently experienced an example of an unclear underlying strategy at a division of a Fortune 50 manufacturing company. The CEO reported flat performance and a feeling of “being stuck in second gear.” Everyone was working more hours than ever but experiencing little progress and no success. While he attributed the situation to an overall lack of accountability, we helped uncover a fundamental disagreement regarding how the company was positioned to compete and win. Roughly half of the executive team, including a very outspoken individual running the international operations, believed that the core competitive anchor for the company was rooted in its ability to provide great customer service. The CEO and the rest of the team thought the game would be decided based on their ability to innovate new products and services. This basic disagreement had some executives pushing in one direction while the others pushed against them. In this example, agreement on the company’s core competitive anchor enabled the executive team to break through several decision “logjams,” give rise to a clear strategy, and pave the way for efficient execution.

What To Do: Invest the Time to Get Clear

Every executive team must come to an agreement regarding the most fundamental aspects of their strategy:

• Who are we?

• Where are we going?

• How are we going to get there?

The level of clarity required for execution is derived from focusing on the practical, pragmatic and actionable answers to these basic questions. For example, in some cases there is more value in crisply defining the basic competitive advantage of the enterprise than in wordsmithing a mission statement or adding more color to an already flowery vision statement. Tools such as these have their place, but too much emphasis can foster belief that strategy is simply employee communications and marketing. We recommend employing a strategic framework to tie together and unify all of the important aspects of strategy.

One of the most important elements of a strategic framework is a Quantified Vision. In addressing where are we going, clarity comes from the numbers. It is extremely powerful to paint a picture of the future with numbers to depict how the organization is going to evolve -- not just financially, but also in terms of customers, products and services, locations, etc.