Is Strategy Execution the new black?
“All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.” —Arthur Schopenhauer (1788-1860)
What is this all about? Is this an approach whose time has come? Are organizations actually approaching execution in a systematic way? Or are consultants just promoting the next fad?
Who is talking about Strategy Execution?
On November 11, 2013, a Google search yields ~30M responses (which compares to ~699M responses for Project Management and ~48M for Change Management). Granted, this is a very blunt instrument with which to measure activity but it is interesting. Thirty million responses suggests there is some chatter.
I happen to monitor Strategy Execution because I figured out about a decade ago, on reading “Execution: The discipline of getting things done” by Larry Bossidy and Ram Charan, that this is what I do. I realized then that I had deep insight and experience in only a few components of it and set out to get an understanding of the broader picture. Even last year when I put together the series on “Strategy Execution Methodologies” it was not such an easy or straight-forward piece of work. There are many who talk in terms of principles—motherhood, if you will—but very few who can translate this into operational process.
Back in 2002/03, references to strategy execution were lower case, as if it were a category like performance improvement or operational efficiency. Not too many people were talking about Strategy Execution. Don’t get me wrong, many consultants use the phrase “strategy execution,” typically as a generic reference to a set of competences or processes, but not as a standard discipline.
Years ago, when I started looking for thought leaders on Strategy Execution, outside of the usual consulting firms who promote their services but publicly provide little in the way of research or process, I found only Conner Partners. Granted, the firm’s inception out of ODR in 2004 gave it a very OD-related perspective; however, the innovative approach was also peppered with bottom-line concepts including strategic alignment, installation vs. realization, and the integration of change management and project management. The firm has continued innovating and you can catch the latest perspectives on “Successful Strategy Execution” in this 21st Century Business Television Series showing across various US cable networks in November 2013.
Other distinctive training and consulting offers have emerged. Here are some examples:
Of note, although a lesser-known name, Joe Evans at Method Frameworks is producing some very insightful and pragmatic tools, techniques, and approaches.
What’s that chatter all about? And why is it “hot” now?
There is a general recognition that the rate and degree of change that organizations are required to make to remain competitive is still increasing. Further, there is a level of anxiety around the low success rates that most organizations have with strategy execution (more on this in “Time to kill the phantom 70% failure rate?”).
As the complexity of strategy has increased and the pressure rises to implement faster, organizations are pressed to coordinate and deliver to higher standards. This is creating interest in the nascent discipline of Strategy Execution.
However, this is not your mother’s Project Management. Project Management emerged years ago and has continued to evolve. It has moved faster than leaders’ understanding of it. Program and Portfolio Management are still not widely appreciated. And yet, only just this August, PMI released a discussion paper on integrating change management (more on this in a subsequent post).
Agree and disagree
There is no standard definition of Strategy Execution so some approaches will agree on some components and disagree on others.
To my mind Strategy Execution is the C-Suite-to-front-line, beginning-to-end conception-to-execution of strategy—from approved Business Case to sustainable results. This means integrating three key components:
Where most thought leadership still falls short, though, is in how to operationalize these in a comprehensive and, yet flexible, approach.
Sure, there is a commercial angle here. Most of the sources noted are consultants and training providers, so if you want to know more about how to execute, you should, of course, retain them and/or take their training. Buyer beware though, in my opinion, most of these are still emergent. My own experience and networking suggests that many large organizations that have thoroughly reviewed some of these offers are still faced with cobbling multiple approaches together to create “ABC Company’s Delivery Approach.”
What is “bigger” than Strategy Execution?
As fast as we are running to help organizations become better, faster, and more effective at Strategy Execution, most organizations are also missing a bigger opportunity.
Surely it has become clear that the notion of stepped change (i.e., make a change, then milk that new competitive advantage, then later change again) is an anachronism. Organizations need to change constantly. This will continue to be a process, but it need not be an ordeal. Organizations need to develop competencies around change. They need to develop a culture of change, an appetite for change.
Many thought leaders have written about “change agility” and the “nimble organization,” but it seems that most organizations are focused on current needs rather than developing deeper capabilities.
Meanwhile, newer organizations in newer industries such as technology and communications seem to have been born into a more dynamic state. Organizations such as Apple, Amazon, and Google live to change.
Imagine the impact on our economy if all of our organizations were highly adaptable.
We are just scratching the surface of this topic. More to come.
So, who do you follow on the subject of Strategy Execution? Or on creating a nimble culture?
Time to kill the phantom 70% failure rate?
The “70% failure rate” has been exploited enough already. It’s time to stop beating this dead horse and give it a decent burial.
I get why it resonates with most of us. Strategy execution is hard. Some falls short of objectives and some fails outright. The more transformational the change the more likely that it will fail in some way. We all abhor failure. Any failure feels like too much. It feels like 70%.
And I get why it is used—fear is a standard sales technique (I am recovering from this nasty habit myself). You know the drill: convince the leaders there is a high risk of failure unless they follow a different prescription. This is used internally to expand execution budgets as well as externally to tout execution services and solutions. Notwithstanding the intentions of either internals or externals, the origin of this legend was never a real statistic. Yes, you read that right. Where did the “70%” come from then? More on this below.
Furthermore, there is better data. In August 2013, The Economist published the first third-party (can anyone say “objective”) survey, “Why good strategies fail: Lessons for the C-suite.” (http://www.pmi.org/~/media/PDF/Publications/WhyGoodStrategiesFail_Report_EIU_PMI.ashx) How about we all do a three-point turn? What are the right questions to ask or conversations to have around success/failure?
First, how did we get here?
As I said above, as far as I can tell, the legendary failure rate is not an actual statistic.
Since I last wrote about this topic I was referred to an excellent article that attempts to track the source of this so-called data. The abstract of “Do 70 Per Cent of All Organizational Change Initiatives Really Fail?” (http://www.tandfonline.com/doi/abs/10.1080/14697017.2011.630506#.UoE8F_lJOHc) (Journal of Change Management, Mark Hughes, 2011) hits it hard: “This article critically reviews five separate published instances identifying a 70 per cent organizational-change failure rate. In each instance, the review highlights the absence of valid and reliable empirical evidence in support of the espoused 70 per cent failure rate.”
Let’s review that: “the absence of valid and reliable empirical evidence.” Wow. That’s pretty amazing, don’t you think?
Hughes reviews each of the five instances—you will probably recognize some of them:
For each instance, Hughes provides the original reference verbatim and also provides some context. I highly recommend this article.
The bottom line is that we don’t know, from the sources cited, what the real failure rate was at that time. We only know what a handful of pretty smart and experienced consultants / academics estimated it was based on their limited exposure.
To be fair, many academics and consulting firms have run surveys. Some consulting firms even run them annually. Their data comes pretty close to 70%. The one that comes to mind is “Success Rates for Different Types of Organizational Change,” (http://onlinelibrary.wiley.com/doi/10.1002/pfi.4140410107/abstract) Martin E. Smith, Performance Improvement Journal, International Society for Performance Improvement, 2002.
This is a “meta survey.” In other words, Smith analyses 49 surveys and drives out median success rates (the median failure rate being, obviously, the rest). What is also useful about this survey is that it identifies by type of change (e.g., restructuring has a 54% failure rate, culture change has an 81% failure rate). With that, one can arrive at a median 70% failure rate. So, maybe one can argue that there is a real 70% failure rate, or there was sometime before 2002 (11 years ago).
In March 2013, The Economist’s Intelligence Unit, sponsored by The Project Management Institute, initiated a survey of 587 senior executives globally and then undertook a series of in-depth interviews with additional executives and academics.
The result was a current and objective (non-commercial) touch-point on what executives believe. As noted on the PMI website:
“Key findings include:
So there it is. These executives believe the failure rate on “strategic initiatives” is 44%.
So while that’s a fair distance from 70%, it is still a very high risk.
So let’s review: we have looked at five original references that turned out to be opinions of thought leaders, a meta survey of 49 sources, and a survey of 587+ executives.
It seems odd, in this light, to realize that this is actually not primary research (i.e., real-time tracking of actual change initiatives on their performance against stated objectives).
This would be the real test, wouldn’t it? One hopes that inside of organizations there might be an appreciation for tracking success/failure and for improving strategy execution over time. Project management protocol calls for a Post Implementation Review and Lessons Learned, but this is rarely converted into organizational learning or harvested into enterprise best practices.
Strategy execution is hard, damn hard. It often fails or falls short.
We may disagree on the degree of risk but no one can predict the probability of success or failure for a particular initiative/organization based on a general survey.
What if we all at least started this conversation from more relevant space? For example, “What is this organization’s experience with strategy execution? Let’s have a look at the data and see how we can help you improve your results.”
Maybe organizations would begin to think about establishing strategy execution as an organizational competency and managing it across the organization, and in working to improve their performance would drive better results to the bottom line. Now, that would be good for all of us.
Earlier this Fall, I facilitated a discussion entitled “What if it’s not true that “70% of change initiatives fail”?” in the Organizational Change Practitioners Group in LinkedIn and many experienced and insightful practitioners chimed in—some agreeing and some disagreeing. Around the same time Jennifer Frahm published an excellent post entitled “70% of change projects fail: Bollocks!” (http://conversationsofchange.com.au/2013/09/02/70-of-change-projects-fail-bollocks1/#!). Much of my thinking above has been informed by their contributions.
The enlightened Program Manager - partnering with Change Management
There are three basic key players in strategy execution: the Leader, the Program Manager and the Change Management Lead.
What if we partnered?
It all starts at the beginning.
The reality in most organizations is that strategy is parsed into Strategic Business Units and / or Divisions and the Leader assigns it to a Program Manager to organize (I am not endorsing this approach?I have other thoughts here). This cascade is often one-directional and the Change Management Lead is buried deep in the project with very little access to the Leader.
In transformational change where ROI depends on people, at all levels, changing the way they think and what they do then Change Management takes on a heightened priority. These shifts in mindsets and behaviors, sometime shifts in culture, cannot be dictated or taught. Rather they must be led. The Leader and the Change Management Lead need to collaborate directly to achieve success.
Imagine what might happen if, when Program Managers resourced a project, they tee’d up change management (CM) differently? What if:
1. The Program Manager identified the senior change management practitioner they want to work with and introduced them to the Leader this way:
2. The CM practitioner entered the conversation with the Leader this way:
3. Once retained, the relationships really need to take on a deep partnering for success:
What if you sent this to your favorite Program Managers and asked them to take it into consideration next time around?
It might open productive conversations and whole new working relationships with them also. They may want to negotiate a few parameters to begin to get comfortable with this dynamic but that should be quite achievable.
What are you waiting for? You want to be successful? You already know what it takes. Require it.
“You’re a little loopy when you’re hungry.” Working at the limits of change capacity
I always laugh when I see the new Snickers commercials—I admit it, I sometimes even rewind them.
They remind me that “You’re not yourself when you’re under the stress of change.”
Have you seen Robin Williams on your projects lately? This is the “Fourth and loopy” commercial where the usually very intense and focused coach is momentarily an incarnation of Robin Williams. Very funny…because we can relate.
“Signs of distress”
There is a point at which any of us reach our optimum performance?many of us refer to this as “The Zone.” Then, under continued pressure, we tip over and become less and less productive. We know intuitively when it is happening but we’re not always conscious of it.
The pressure also affects our project team and the people in the organization impacted by change (change targets).
In Managing at the Speed of Change, (1) Daryl Conner identified the signs of distress. Have you seen these in your projects? Here are some excerpts (quoted with permission):
Symptoms of low-level stress:
Increasingly dysfunctional behaviors:
Tangible and measurable
What you might observe is that, as the levels of change increase, dysfunctional behavior becomes more apparent and more severe.
You may also note that many of these symptoms pose immediate, tangible, and measurable impacts on productivity (and potentially on quality and safety), not to mention ultimate ROI of the initiative.
Why does this happen?
Our capacity for change is limited, and yet manageable
One perspective on the capacity of humans for change comes from Alvin Toffler: “Future shock is the shattering stress and disorientation that we induce in individuals by subjecting them to too much change in too short a time.” (2)
This sure sounds like many of the transformational initiatives I worked on early in my career.
In Managing at the Speed of Change, Daryl designed a working definition for future shock as “that point when humans can no longer assimilate change without displaying dysfunctional behavior.”
I have seen that switch flip. Have you?
So, what is capacity?
Daryl explains capacity for change with a metaphor:
We often hear targets inside of change initiatives say, “It’s raining change,” “When will it stop?” and plaintively, “When can we go back to business as usual?”
The challenge is that organizations must make so much change annually now that “business as usual” really doesn’t exist for many people any more.
If you need your people to assimilate a change (to become proficient and even excel with it) and there is more, and perhaps concurrent, change coming, then learning how to manage capacity for change is crucial. This is a moral and a business imperative—ROI depends on it. It is a key component of organizational change management (i.e., helping people transition through change).
Fiduciary duty to optimize capacity and balance demand
Many leaders and project teams make an implicit assumption that capacity for change is unmanageable. This is both dangerous and untrue.
If you understand that change demands can put individuals and organizations under enough pressure to impair their ability to deliver daily tasks as well as impact their overall well-being, then you must acknowledge that it will become untenable at some point. Knowing where that point might be is a fiduciary responsibility. The moment it affects quality and safety, the organization has crossed into liability space.
Furthermore, if this risk jeopardizes the project ROI then it likewise requires attention.
What can we do about capacity and demand?
In the fourth post of his “Capacity and Demand” series, Daryl presents “Putting It All Together—The Mechanics of Capacity Management.” As he notes, the objective is to “determine the desired balance between demand and capacity (stretch the organization’s limits while keeping change-related dysfunction within acceptable boundaries).”
Activities should include:
Interventions can include the following:
Is your project, and your team, suffering the negative impacts of change overload?
Is your ROI in jeopardy? This is serious risk.
Four things you can do:
(1) “Managing at the Speed of Change: How Resilient Managers Succeed and Prosper Where Others Fail,” Daryl Conner, Random House, New York, 1992, 2006
(2) “Future Shock,” Alvin Toffler, Bantam, New York, 1984
“The whales sing, not because they have an answer. They sing because they have a song.” —Andrew Stevenson
There is no substitute for getting away from it all.
Displacement is a powerful rejuvenation technique.
For six hours on March 14thwe forgot everything. We focused only on finding whales. I hope this story will “take you away” for a few minutes.
The power of adventure
This was the first whale-watching trip of the year for the Endurance, the official research vessel of the Bermuda Zoological Society, which runs out of the Bermuda Aquarium, Museum & Zoo (BAMZ).
Every year in March and April, humpback whales migrate from the Caribbean to New England, the Maritime provinces of Canada, Labrador, Greenland, Iceland, and even Norway. They pause in Bermuda on their 5000-kilometre journey to rest and feed (sound familiar?).
We were fortunate to be joined by Lynne, a biologist from BAMZ and, at the last minute, at the invitation of Captain Nigel, by Andrew Stevenson, founder of the Humpback Whale Research Foundation. As we set out (and immediately forgot all of our daily stresses), Lynne told us what to look for (a mist, or “blow” on the sea as the whales come up to breathe), described common humpback whale behaviors such as logging (swimming along the surface) that we might see, and shared stories of previous sightings. Andrew noted that he had seen twenty different whales just the day before.
Captain Nigel let us know that our path would take us on almost a full loop of the entire island in six hours. As we headed east, he tried to manage our expectations: “Finding the whales is a bit ‘hit and miss’?naturally the whales move around so we might see some and we might see none.”
Uninformed optimism and conscious incompetence
We were still incredibly optimistic and scanned the horizon looking for anything that might look like a whale breathing.
Mid-March in Bermuda is winter. The ocean seems like a massive cauldron. Even on this beautiful day, the waves were easily 10 feet and rolled in lengths of 100 feet. The boat that seemed big at the dock became remarkably small. Yet we were undeterred.
One of the guests became increasingly seasick (known locally as “feeding the fish”), but we were glued to the deck on look-out. Andrew and Lynne made their way to the top deck and braved the sea spray for a better view. None of the rest of us were so brave.
The hours and the miles passed and we became a little worried. Was that a whale? Or just a wave? The eyes begin playing tricks with you when you want something so badly.
More time passed. The kids had a snooze in the cabin.
About four hours in, Andrew called out, “Whale! 1 o’clock” (front right of the boat).
We all sprung into motion and crowded at the edge of the boat, straining to learn what a “blow” looks like.
There it was! Smaller than you might think, in the distance. Then a fin, then a second fin! Amazing.
Captain Nigel, half-in the cabin and half-out through the driver’s window kept look, steered, and adjusted the speed. “We have to pace them. We don’t want to over run them or scare them” Lynne explained.
We were breathless. Where were they?
Suddenly the ocean seemed vast again. They could be below the boat or a mile farther away. “They breathe every three minutes,” someone said. We waited and tried to time it. Did we miss the last blow?
There! Ahead! Again, Nigel sped up to get close enough to see but not close enough to scare them, or endanger us.
Wonderful. We watched them as long as they let us. We were hooked. Then they were gone.
We cruised around a while longer but it seemed those two beautiful whales would be it for today.
On the way back, I had an opportunity to speak with Andrew. He is a man who has repeatedly reinvented his life?you can read his amazing story here.
By my count, he has lived in eleven countries and it is easy to lose count of the number of his vastly different careers. He says he even has dreams of another country and another career.
The Humpback Whale Research Foundation, his current project, has catapulted humpback whale research: “By the end of 2012 we had obtained 673 fluke IDs, which compares to 145 Bermuda fluke IDs over the 40 years before this project began.”
In 2010, he learned how to film and produce an underwater movie. Amazing you say? Better still, It was an award winning production. If you can give yourself five more minutes, watch this clip from “Where the Whales Sing,”narrated by his daughter Elsa, then a precious six years old.
His advice to me? “Life is short. Follow your passion.” Sounds quaint right? Not so, coming from a man whose own life is a testament.
I hope that in sharing this little story you might experience a break?a little vicarious R&R.
And I hope that if you are considering taking a vacation to rejuvenate, this might be a tipping point.
And if you have any interest in whale watching, Bermuda, or anything else, I hope you will feed your curiosity.