Agile Business Ownership and the premise of strategy execution

A 2019 study by Harvard Business Review Analytic Services of 1,636 executives from around the world revealed that only 20% of organizations achieve 80% or more of their strategic goals. The rest fail to turn their strategic goals into reality. This figure highlights the difficulty that many companies face when trying to successfully implement their strategies. One might question whether we can generalize this finding by saying that the majority of organizations fail to turn their strategic goals into reality.

Another relevant study from 2017, conducted by the Economist Intelligence Unit and sponsored by the Brightline Initiative (PMI), interviewed 500 senior executives from companies with annual revenues of 1 billion dollars or more and revealed that 63% of respondents admit that implementation is not seen as a strategic task, despite its contribution being crucial to the success of the business.

Without effective execution, the strategy remains just a plan on paper. Strategy execution involves engaging people, mobilizing resources and carrying out activities that create value for stakeholders across the organizational ecosystem. This can include developing new products and services, improving operational efficiency and effectiveness, providing excellent customer service and many other elements that generate a competitive edge for the business. Therefore, strategy execution is essential for generating value and may require ambidextrous management, which balances efforts to sustain and improve current operating models with those of innovation and organizational transformation.

At Agile Business Ownership, we understand that strategy execution is what guarantees organizational evolution towards achieving the future state desired by senior management (the strategy itself). It is strategy execution that enables sustainable business growth. By implementing the strategy effectively, the company can achieve its business objectives, such as developing the following organizational capabilities that make Business Agility a reality in organizations:

1. Respond quickly to the needs of customers and other stakeholders.
2. Adapt to the changes and trends of an increasingly VUCA and digital world.
3. Accelerate growth through innovation, creating trends with new products and services.
4. Attract, develop and engage talent in the company's transformative purpose.
5. Carry out the necessary organizational transformations in a sustainable way.

Therefore, the third premise of the evolutionary practices of Agile Business Ownership states that:

(3) Strategy execution must guarantee organizational evolution and enable sustainable business growth.

To close, a few questions for you to reflect on your organization's performance: How effective is the execution of your company's strategy? How do you measure it? How are leaders and managers being trained to increase discipline and performance in strategy execution? How are corporate governance and portfolio management addressing this challenge?

In the previous article , I presented the seecond premise of the evolutionary practices of the Framework for Agile Business Ownership, which places strategy at the heart of the process of organizational evolution. In the next article, I will present the 4th premise, which focuses on the need for a continuous process of discovering and delivering business value to all stakeholders in order to ensure organizational evolution. Stay tuned!