Truth About Why Strategies Fail

Let’s begin with an important question. Why do strategies fail?

We all have seen fancy documents of the new strategy in a PowerPoint presentation and a report with weighty stats which are all trying to justify why the chosen strategy is better and why we should pursue it. Soon, the new strategy is communicated, balanced scorecards are recalibrated, clear budgets are defined along with the buffers obviously to support various initiatives to amplify the new strategy. And then nothing happens.

The reason you would ask, at this time it’s fair to assume that the new strategy failed because it might not be a strategy at all. In my mind, a strategy should have a clear set of options that define what an enterprise is going to do and most importantly what it’s not going to. In short, strategies fail to get implemented, despite all the hard-working people, because they do not frame a set of clear choices.

 “Our brand should be number one or number two in the market in which we operate” is a classic example of a goal and not a strategy. Why? Because it doesn’t specify what should a company do; it just tells you about the desired outcome. Others may define a set of organization’s priorities, but they do not help to form a coherent strategy when considered in conjunction. For example, “We want to increase organization operational efficiency; we will target specific geography and will invest X amount over Y years”. These may be excellent priorities, but together they do not form a strategy.

Without a clear strategic direction, organizations implementation plan will definitely fail. Three simple thoughts to rescue your strategy,

• Spend time to explain the logic behind the choices: A limited set of choices that fit together. You cannot communicate a list of 10-20 choices, because nobody is going to remember them. And if they don’t remember them, it’s really difficult to influence their behaviour, in which case you do not have a strategy (but just a fancy PowerPoint deck)
• Not just a top-down process: Another important reason why strategy fails is because of a top-down process. Consider that your, “Organization strategy is ready; now it’s time to implement it”. That might not work. According to Robert Burgelman a Standford professor, “Successful organizations are distinguished by keeping a bottom-up internal testing & selection processes and at the same time maintaining top-driven strategic intent.” Therefore, the strategy will only be effective if, the organization creates bottom-up initiatives that fall within the boundaries set by that strategic intent.
• Change is a default: Lastly why strategy fails is because all strategy requires changing people’s habits. These accumulations of habit’s certainly don’t change by telling people in a town hall meeting that they should act differently. Often times people are not even aware that they are doing things in a particular way and that there might be different ways to run the same process.

I hope you liked the article, if you wish to explore more on the topic of strategy, I strongly recommend checking the below link - https://www.gsb.stanford.edu/faculty-research/books/strategy-destiny-how-strategy-making-shapes-companys-future