Meshing Strategy with Reality

The first task of any theory is to clarify terms and concepts that are confused…
Only after agreement has been reached regarding terms and concepts, can we hope to consider the issues easily and clearly and expect to share the same viewpoint…  - Carl von Clausewitz   Great military strategist of the nineteenth century

Carl von Clausewitz stressed the importance of a framework to organize thinking about strategy. And such a framework is becoming increasingly important on today’s battlefield of B2B competition.

Executives are finding that the winning differentiator is increasingly the level of engagement with the customer which is coming to mean a more strategic way of looking at the relationship. In the context of the emerging marketplace, engagement refers to the creation of a deeper and more meaningful connection. Cultivating the necessary level of engagement is a job being undertaken in various ways throughout the entire enterprise, even in the executive suite. High performing companies have an integrated process for sales and operations planning.

The need to realize engagement across the organization has put renewed importance on the element of execution. In fact, execution could be the biggest issue facing business today. However often a gap exists between what executives aspire to achieve and the results the organization delivers. The fundamental problem is that people think of execution as tactical initiatives, something that senior executives delegate so as to allow them to focus on what are perceived as “larger” issues. 

Consider a 2010 survey by CSO Insights of sales leaders where more than 1,800 respondents listed their 13 top initiatives to improve performance in 2009. The items on the list were almost identical to the list developed in 2008. If tactical implementation had been successful in the past, would these leaders need to keep doing it? This kind of repetitive tactical effort often happens in the context of manufacturing settings where the initiatives involve lean tools.

Execution is not just tactics; rather it involves a systematic approach and discipline. It must be built into the company’s three core processes of strategy, people and internal operations.  While executives such as Jack Welch at GE, Richard Teerlink at Harley-Davidson and Larry Bossidy at Allied Signal and Honeywell have all provided a wealth of experiential insights into achieving execution, they did not articulate a consistent standardized framework to describe strategy.

The consequences are that often executives cannot effectively communicate strategy among themselves or their employees. Without a shared understanding, it is difficult to create alignment around it and achieve the desired cohesive effort across the organization needed for disciplined engagement. And without alignment, leaders will not be able to optimize their strategies for the changed environment and create a dynamic competitive advantage which will have to come more and more from intangible assets.

The framework of lean deployment provides the vital alignment and the cornerstone in the foundation of the planning structure, consensus. Research has shown that approximately 75% of executive teams do not have a clear consensus, that is the same viewpoint, around the customer value proposition.  Creating value from intangibles differs in several ways from that created by managing physical and financial resources:*

  • Value creation is indirect
  • The value is contextual
  • The value is potential
  • Assets are bundled

With the benefit of a framework to organize the thinking of everyone in the enterprise – more battles can be won.

* David P. Norton and Robert S. Kaplan

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