We wrote a two-part article all about mistakes leaders make when executing strategy, and how they can be avoided.
Part 1 (you're here)
This year, the 4th edition of the Cosmic Conference dives into the heart of strategy execution challenges and helps leaders unpack actionable solutions to transform their strategies from wishful thinking to tangible reality. At the opening event of the Cosmic Conference, Cosmic Centaurs CEO & Founder Marilyn Zakhour talked in her keynote about leaders being the enablers of strategy execution in their company.
“Kaplan and Norton are among the rare few who have studied the intricate art of strategy execution. They've delved deep into the challenges faced by organizations aiming to translate their strategic visions into tangible results. Their research led them to identify three crucial enablers that underpin successful execution. Leadership: Here's the hard part. While Kaplan and Norton can offer templates and best practices for everything else, leadership is the wildcard.” said Marilyn.
In the first part of this article, we list 4 of the 9 mistakes that leaders make when executing strategy and how you can avoid them.
1- Neglecting to Involve Individuals from all Organizational Levels
The Mistake: Excluding individuals from various organizational levels in the strategy development and validation process can result in narrow viewpoints and reduced commitment from the team.
The Solution: Foster inclusivity in strategy creation by involving representatives from every level. Diverse input ensures a holistic understanding of challenges and opportunities, fostering a sense of ownership among employees. This inclusivity not only enhances the quality of the strategy but also cultivates a more engaged and committed workforce.
Our Approach: To ensure inclusivity in our team selection, we conduct a Stakeholder & Influencer Mapping exercise. The objective is to map key stakeholders across various organizational levels, identifying individuals who should participate in the strategy development process based on their roles, expertise, and influence.
2- Overlooking the Capability Gap Analysis
The Mistake: Ignoring the crucial step of capability gap analysis hampers the identification of skill and resource deficits required for effective strategy execution.
The Solution: Conduct a comprehensive capability gap analysis to identify areas where the organization lacks the necessary resources, skills, or technology. By understanding these gaps, leaders can strategize on how to bridge them, ensuring that the organization is well-equipped for successful execution.
Our Approach: The capability gap analysis can be conducted using a variety of tools and techniques that we tailor to each client’s specific context. This may involve Skills Assessment surveys, interviews, workshops, observation days, or the utilization of specific competency frameworks.
3- Misaligning Budget with Strategy
The Mistake: Failure to align the budget with the strategy, neglecting the distinction between STRATEX, OPEX, and CAPEX, can lead to misallocation of resources and hinder execution. Companies develop strategies that are quite differentiated from the current business as usual, but fail to allocate the needed resources and budget needed to execute them.
The Solution: Ensure precise alignment between the budget and strategy. Clearly delineate strategic expenses (STRATEX) from operational costs (OPEX) and capital expenditures (CAPEX). This alignment guarantees that financial resources are allocated in accordance with strategic priorities, fostering efficient execution.
Our Approach: Leverage a Zero-based budgeting approach to help organizations identify the budget allocations needed to deliver on their key strategic initiatives. The ultimate goal is to ensure that the budget allocations are directly tied to the delivery of key strategic initiatives.
4- Hyperfocusing on Quick Wins:
The Mistake:Prioritizing quick wins at the expense of long-term goals can undermine the sustainability and impact of the overall strategy.
The Solution: Play the long game. While quick wins are essential for morale and momentum, leaders must balance short-term gains by also prioritizing sustained success over the broader horizon. As this HBR article beautifully puts it, “One of the most visible and essential elements of your job as a leader is to create an exciting, unified vision of the longer-term future for your company or unit.” This requires patience, resilience, and an understanding that enduring change takes time.
Our Approach: Collaboratively define strategic Key Performance Indicators (KPIs) that align with each of the organization's goals and establish a process to monitor and review them. Developing metrics scorecards will provide the team with visibility to identify areas where quick wins can be achieved by focusing on specific, high-impact initiatives. By following this approach, leaders can ensure that each quick win contributes to the broader, longer-term strategic objectives. From there the advice we give to all leaders we work with is to do one small thing every day that will get them closer to their long-term vision. This could simply be one phone call, reading one article, writing an email, etc.
This article is split into two parts. Read Part 2 here.