The strategy execution gap
The gap that became an unbridgeable chasm
“The causes usually cited for failure of a company are costs of start-up, overruns on costs, depreciation of excess inventory, competition — anything but the actual cause, pure and simple bad management.” — W. Edwards Deming
My colleague Dr Richard Claydon recently asked the LinkedIn community: “Is the strategy - execution gap widening?”.
His question was prompted by having encountered the following problem multiple times over several weeks:
“Senior executives want something done. In transmitting what needs to be done, they are partial and fragmented in their communication. Those doing the work are not sure of the bigger picture, and how what they are being asked to execute fits with other executional projects.”
The individuals tasked with implementing the decision from on high take action based on their local interpretation of the vaguely specified requirement, only to be told later by the requesting executive that they “shouldn’t be doing it that way”.
As Richard pointed out, this creates a toxic environment:
“Neither purely delegative, in which executional managers have the power to determine how to execute, nor purely directive, as the executives-in-charge don't have the knowledge to tell them how to effectively execute.”
Consigned, constrained and condemned to inhabit this half-way house:
“Very little gets done at any pace. Those doing the work wait for those planning the work to be told how to do it, whereas those planning the work don't have the expertise to know how it can be done, meaning every problem is a tricky one that needs to be solved in, for them, novel ways.”
Richard concludes that this counter-agility is unlikely to be deliberate, but a consequence of:
“The legacies of traditional management and strategic planning impacting complex, agile-like executional processes. Everybody involved thinks they are doing the right thing, but are speaking completely different languages.”
Viewed from the senior executive perspective, the strategy execution gap is clearly widening.
But there’s a much deeper problem that few senior executives see — the gap cannot be bridged by the conventional thinking that still dominates the organisational discourse.
Why is that?
The world has become too dynamic, uncertain, and unpredictable for the legacy strategy approach in which senior executives devised a strategy, along with their favoured strategy consulting firm, turned this into a high level plan, broke this down into detailed plans, and rolled these out for execution.
Try that approach in today’s increasingly volatile world, and by the time the detailed plans are ready to be rolled out, the world has moved on, and the underlying assumptions on which the plans are based are no longer valid.
In a nutshell, that’s why future-fit organisations have cultures of innovation, agility, and adaptiveness, where sense making, decision making, & action taking are ever more tightly coupled, rapidly and repeatedly iterated, deeply embedded, and widely distributed throughout the organisation.
The notion that senior executives can cook up a strategy and then hand it off to others to implement was already seen as wrongheaded nearly thirty years ago by Professor Henry Mintzberg, who called it “The Grand Fallacy” in his seminal book “The Rise and Fall of Strategic Planning”:
“No amount of elaboration will ever enable formal procedures to forecast discontinuities, to inform managers who are detached from their operations, to create novel strategies. Ultimately, the term ‘strategic planning’ has proved to be an oxymoron”.
The problem is that old-school organisational strategies only capture a narrow, limited, snapshot at the time of formulation.
These snapshots are far too static, superficial, and simplistic to be of use in dealing with the rapidly evolving dynamics affecting today’s organisations.
This was all too evident in March 2020 after Covid-19 had blown everyone’s annual plans out of the water.
And although the pandemic was a huge dollop of uncertainty and unpredictability laid onto organisations all in one go, it’s far from unique in its scale and impact.
Other now apparent but formerly unpredictable factors include:
Increasing political polarisation leading to flip-flop instability.
A European war affecting global energy and food supplies.
Double-digit rates of inflation unseen for decades.
These, and other unpredictable uncertainties yet to reveal themselves, clearly illustrate what Mintzberg saw all those years ago: the fundamental inability of strategic planning to forecast discontinuities.
So why do organisations cling to legacy mindsets, attitudes, and behaviours around strategy and execution whose fatal flaws were described decades ago by respected experts like Mintzberg ?
A major factor is that senior executives have failed to realise — both in the sense of “become aware” and in the sense of “brought about” — the necessary shift in their awareness of what their role is in ensuring organisational success.
Specifically, most senior executives still see themselves as “decision makers” — despite the fact that in future-fit organisations the senior executive role is not “making decisions” but “creating conditions” — conditions in which good decisions get made and implemented dynamically, rapidly, repeatedly, and adaptively enough for their ever-changing reality.
This legacy senior executive focus prevents decisions from being informed by the rich sense making already happening in the body of the organisation, where:
People are in most direct day-to-day contact with most customers.
People are most closely involved in everyday value creation and see what’s working well, what’s working less well, and what’s not working at all.
The maximum diversity of perspectives come together from multiple generational cohorts.
The fact that the effective senior executives of the future will be those who create conditions in which sense making, decision making, and action taking are effectively joined up, iterated, embedded, and distributed throughout the organisation also requires an updated understanding of the nature and practice of leadership.
Up to the mid 1990’s, the default understanding was that leadership is something done by a senior executive elite — “the leaders” — and done to everyone else — “the followers”.
This was most powerfully captured by Harvard Professor John Kotter in his 1996 bestseller Leading Change:
“Leadership defines what the future should look like, aligns people with that vision, and inspires them to make it happen”
But just as Mintzberg saw more clearly, forward-thinkers such as my colleague Dr Peter Senge saw leadership in ways that are appropriate to today’s world:
“Leadership is the capacity of a human community to shape its future.”
Kotter did eventually acknowledge this failing himself — noting in his book’s 2012 update: “more agility and change-friendly organisations” and “more leadership from more people, and not just top management” are increasingly vital.
But the outdated legacy notion of leadership as something done to everyone else by an elite group of senior executive decision makers is still dominant, and heavily reinforced by mainstream finders, minders, grinders consulting firms hired by senior executives who often feel overwhelmed by the need to fundamentally transform not only their organisation, but also themselves.
To such senior executives, having a big brand name consulting firm promise to take the problem off your hands can understandably be very seductive.
But hiring such a firm costs organisations much more than just their fat fees.
That’s because the mainstream consulting firms solidified their finders, minders, grinders operating model over decades to provide research-based answers in support of senior executive decision making.
It's this operating model that gives rise to their characteristic modus operandi of mobilising large numbers of junior consultants deployed via one-size-fits-all, “cookie cutter” approaches designed to reduce risk and maximise profitability.
However, the fatal flaw with this approach becomes evident when a client organisation wants to create a future-fit culture of innovation, agility, and adaptiveness to thrive in an increasingly uncertain and unpredictable world.
Creating such a culture requires the client organisation to develop new innovation, agility, and adaptiveness muscles — muscles that will only be developed when people in the client organisation do the heavy lifting themselves.
Hire a traditional consulting firm and, by definition, it’s their junior grinders who do the heavy lifting, so any muscles that get developed are in the consulting firm, not the client organisation.
The net result of the above is the counter-agility that Richard refers to.
This will continue to get worse until senior executives focus on fulfilling their primary future responsibility — creating conditions where sense making, decision making, and action taking are ever more tightly coupled, rapidly and repeatedly iterated, deeply embedded, and widely distributed throughout the organisation.
Only those senior executives who make this shift will enable emergence of the future-fit cultures of innovation, agility, and adaptiveness required for their organisations to thrive, and their people to flourish, in an increasingly uncertain and unpredictable world.
Questions for reflection
Is the strategy execution gap still widening in your organisation?
Have senior executives woken up to the fact that their role has fundamentally shifted from making decisions to creating conditions?
Is there a focused, strategic transformation underway to address the increasingly urgent need to create a future-fit culture of innovation, agility, and adaptiveness?
If not, why not?
Out of the Crisis. (1982) Preface.
Richard and I collaborate with clients at the intersection of future-fit culture and future-ready leadership. His original LinkedIn post on the strategy execution gap question is here.
The Rise and Fall of Strategic Planning (1994) p321.
I explored the challenges of this shift in more detail in a previous article: From Strategy to Sense Making
I described this in greater detail in a previous article: Senior executives must give up their decision rights
Leading Change (1996) p 28.
Peter and I served together on the Global Leadership Team of the Society for Organisational Learning (SoL) from 2009-2015. His definition of leadership as community capacity is in his book The Dance of Change (1999) p16.
Ibid (Kotter 2012 update) preface ix.
I unpacked the big consulting operating model in the previous article: Veni, Vidi, Invoici
Ibid - Veni, Vidi, Invoici
Ibid - Veni, Vidi, Invoici
Ibid - Veni, Vidi, Invoici