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Strategy Definition or Strategy Execution…

Which is more important?   It’s a bit of a chicken vs. egg argument, but it’s fair to say that both are critical to driving positive financial results.   Put it this way, if defining strategy explains 15% of a company’s financial performance then 85% must be explained by the execution of the strategy.  You can’t separate the two, but given those percentages it’s also fair to say that execution is  a much harder task. The more you study this the clearer the evidence becomes.

 

What do the greatest companies all have in common?  You got it — the ability to focus their organization on strategy execution by ensuring that each individual is working (i.e., executing) on goals that matter to the organization.  What type of goals “matter?”  Put simply, only the ones that have a direct line back to the Strategy sitting in a binder on the CEO’s bookshelf.

 

We’re just researching what impact we have on our customer’s ability to communicate strategy and execute new directions faster. The early results are very intriguing and positive – and we promise to share them when we finalize our research.   The timing is also significant as the economy has forced companies to be agile and demands that companies be able to shift their strategy (and subsequent execution) at a much more rapid pace than in a bull market.

 

The thing that struck me when doing some desktop research was that even though we know that 85% of performance is due to execution, the amount of content available is unbelievably skewed towards strategy — a simple web search on “Business Strategy” returns 3X more hits than “Business Execution”  (80M hits vs. 24M hits).   The term strategy execution returns only 3.5M hits.

 

The good news is that the “worm is turning.”   Execution is the topic du jour – maybe it’s the economy, maybe it’s just the natural evolution of business.   Regardless, you can put us squarely on the “Business Execution” team, and we’re looking forward to sharing our results soon.

 

After all, Execution is the name of the game to drive financial results



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