While the dictionary defines “strategy” as “an action designed to achieve a long-term or overall aim,” leaders have always cautioned that “there’s many a slip ’twixt the cup and the lip.” You may have the best strategists who can map scenarios drawn up by futurists, and those strategists can plan what issues the organization needs to do to address, but change occurs only when plans are executed effectively.
In other words, you may have the best tour guide and a car equipped with the most powerful four-wheel drive engine and latest navigational system, but you can’t move forward without turning on the ignition and hitting the gas pedal. That is the sixth, most important phase of the whole Strategy Development Approach I outlined in my previous posts.
The “execute” phase is critical for creating a workable action plan. It asks, “how do we drive change?” and then allocates resources, including manpower, equipment, services, and finances, to make change a reality. It involves mobilizing partner resources and elements important for daily organizational operations to meet the strategic goals set in the “formulate” and “explore” phases to exploit future opportunities defined in the “anticipate” phase. Three tools commonly used during the execute phase are strategy maps, the balanced scorecard (BSC), and strategic expense (StratEx) management.
While a strategy map translates a plan into action in a visual or graphic format, the BSC helps measure targets and goals defined under the strategic objectives to evaluate progress beyond traditional financial measures. In the case of the APO, for example, the BSC may include strategic objectives related to sustainability, stakeholders, internal processes, and people and knowledge.
A strategy map aligns goals with issues defined in the explore phase, usually represented as bubbles on the map to give a macro view throughout the organization. This is also important from the resource mobilization perspective, since the bubbles enable each department and individual to envision their roles and align them with the overall organizational goals. They help individuals understand how they fit into the big picture and the changes, including skill upgrading or training and business process modifications, required to meet key performance indicators.
The BSC, developed by Dr. Robert S. Kaplan and Dr. David P. Norton in 1992, is one of the best performance measurement frameworks used globally and is invaluable in measuring organizational progress based on strategy maps. The Balanced Scorecard Institute defines it as “a strategic planning and management system that can help an organization not just measure and monitor progress towards strategic targets, but also enables it to align the day-to-day work that everyone is doing with strategy and prioritize projects, products, and services.” Last but not least is StratEx management, or monitoring significant expenses required to meet strategic objectives and manage the changes needed to prepare for the future.
However, there is another critical component, or the other side of the execute coin. While a strategy map, BSC, and StratEx management are important tools for translating a strategic plan into action, risk management is the other of the coin that can help organizations stay on track and avoid potholes in the road as they speed toward their destinations. Like 100-meter sprinters, whose ability to adapt to track conditions is nearly as important as their speed, organizations must be aware of risks, which are basically the effect of uncertainties on the final objectives. The ability to see the whole picture, align individuals with key performance metrics, and constantly measure and correct the course is critical for the Sustainable Productivity journey.