Strategy plays an important role in guiding the company in the right direction and to help achieve its Vision. It is also the key to staying competent in the market. However, according to this HBR article, many companies still experience a gap between organisational strategy and its execution.

Top management of the organisation spends large amounts of time and effort in developing their strategies for the coming year or whatever duration is suitable, but usually long term. They also go the extra mile to communicate these strategies to the relevant people in the organisation and make sure they are thoroughly understood as well.

Despite all these efforts, there is a gap between what needs to be done and what actually does get done. This is the execution gap which many organisations find it difficult to overcome.

According to the HBR article, authors Paul Leinwand, Cesare Mainardi, and Art Kleiner have examined 49 enterprise leadership teams to understand how the most successful teams bridge the organisational strategy execution gap. The 2 most important factors that they studied are:

• How do high performing teams spend their time
• What is the perceived effectiveness of such teams on critical behaviors such as setting goals, etc.

In this blog, we will further analyse the study and interpret a few important statistics that the authors have collected. In addition, we will provide a few tips on what should be done to make sure these challenges are circumvented.

Importance of defining strategy

The management needs to be very careful while drafting their strategies. These strategies play an important role in the goal setting process of the organisation. When set in the right manner, these strategies can help the company reach their destination. But if they fail in this very first step and are unable to correctly define the right course of action, they may definitely need to restart from the beginning.

• High performing teams spend nearly 20% more time (compared to low-performing teams) defining strategy (i.e., translating a high-level vision into clear actionable goals). (Source)

The most common problem that companies face is that strategies they create are vague, unactionable, or altogether misdirected. A lot of opportunities are lost due to poor organisational strategy definition.

It is recommended that the management views strategy less as a plan and more as a direction and set of criteria to make business critical decisions. The strategy should consist of actionable and precise criteria that will sustain for intended duration. It should help in making short-term decisions with the end destination in mind. At the same time, the strategy should be flexible enough to change since it is incorrect to assume that there is only one path to reach the destination.

Align organisational strategy with goals

Majority of companies fail to execute their strategies effectively simply because they do not take steps to break them and align with team and individual goals at multiple levels of the organisation.

• High performing teams spend 12% more time aligning the organization around that strategy, through frequent internal communications and driving a consistent message downward into the organization.

• High-performing teams spend over 25% more time focusing the enterprise than their lower-performing peers. That time is spent establishing financial and operational metrics, aligning goals with overarching strategy, allocating resources, and reviewing key metrics.

One of the many approaches available is through OKR goal setting methodology. It is one of the surest ways to ensure individual and team goals are efficiently aligned with the company’s overall growth strategy in order to be effective. The employees need to understand how their individual role and responsibilities fit into the larger picture of organisational strategy.

Leverage continuous feedback to stay on track

Companies who consistently communicate with their employees about the strategies and goals are better able to keep them engaged in the work they do.

• High-performing teams spend 14% more time checking their progress against strategic goals by reviewing key metrics and shifting resources accordingly..

A culture of continuous feedback is important to make sure everyone is on track and going in the same direction. Every individual can regularly receive as well as seek feedback from their manager and other colleagues, instead of the once a year feedback. It helps both to focus on achievements, areas of improvement and further increase the employees potential.

Due to continuous feedback being exchanged through the organisation, the management is better able to identify if there is strategy-execution gap and accurately spot the bottleneck. Thus, it is better to be proactive and agile to reap the benefits of continuous feedback.

To summarize: Companies can become successful at devising bold but executable organisational strategy by reinventing their work culture and making sure that employees are equally invested behind the change so that everyone is motivated to go the distance.