The critical aspects of strategy
Strategy development is an essential aspect of execution. There are two aspects of the strategy that can have an effect on its execution: the kind of strategy, and how it is translated into plans.
There are four critical characteristics of a strategy that leads to successful execution:
- planned — A realistic, workable strategy begins with good planning. Before you make any major move, evaluate the current situation and possible consequences. Poor planning can significantly affect execution. Because the goal of business strategy is always to gain competitive advantage, your strategy should be planned to gain an understanding of the industry and competitors, and to develop capabilities that increase your competitive edge.
- integrated — Corporate and business strategies must be integrated if your strategy is to be executed well. The strategies must support each other.
- measurable — For a business strategy to be executed well, it needs measurable objectives. Everyone involved should know what metrics will be used to measure strategic performance. You should have a plan in place that can be used to assess your progress with regard to short- and long-term goals.
- supportable — To be successful, the business strategy must be supportable. Trying to make changes that are too big in too short a time could make demands on the organization’s skills, resources, and capabilities that can’t be supported. If you ignore these demands, you’re unlikely to be able to execute the strategy effectively.
Selecting strategic initiatives
The second step in creating strategy that executes is to develop the strategy. This involves four steps:
- select strategic initiatives based on themes
- assign accountability to initiatives
- translate initiatives into strategic targets
- allocate resources to initiatives
The first step in developing a strategy involves actually selecting strategic initiatives. It’s important to evaluate which strategies you should choose to implement, based on the existing situation in your company and the potential consequences. Poor planning can negatively affect many areas of the organization.
Sound planning and a clear, focused strategy are essential if the company is to reach its goals. That’s where strategic initiatives come in. They’re the short-term actions that guide your company toward achieving its vision. The company screens strategic initiatives and selects them by examining whether they help the company achieve its objectives.
Selecting strategic initiatives involves five steps:
1. examine the strategic objectives that have arisen — During the defining process, you will have formulated strategic objectives in each of the four strategy map perspectives: financial, customer, internal, and learning and growth. The objectives are the continuous improvement activities that link to your strategic themes.
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