After completing a strategy process, a lot of managing directors I work with are tempted to breathe a sigh of relief. However, if you think going through the process of discussing strategy and creating a plan means it will magically be implemented, think again. Only 10% of companies implement their strategy successfully.
A few years ago, Fortune Magazine published a surprising statistic that stated only 10% of employees understand their company’s strategy. If employees don’t understand their company’s strategy, how can they possibly be expected to implement it? Strategy implementation requires its own effort and plan of action. The following three steps will help you start this process:
Most managing directors under communicate, especially in the areas of strategy and what it means to the roles and responsibilities of people in different departments. Communication happens through conversations. Communicating strategy is not simply a presentation of the company’s highlights to all employees. People need to understand where the company is going, why, and the strategies that will help them reach their goals. So how much communication is enough? Employees need to hear about the strategy all the time. Perhaps if more companies knew that increased communication drives increased financial performance, they would build a strong communication plan into their business plan.
As managing directors communicate the strategic plan, they must also encourage people to ask questions so they really understand it. In large meetings, ask a lot of questions so people will have the opportunity to interact with others in different teams. Don’t be afraid to let people challenge the strategic direction. This type of a dialogue engages people to help them understand not just what the strategy is, but why the company has chosen a specific strategic direction. Ensure managers know how to cascade the strategic plan to their teams. Improved implementation is the result of people really understanding what the strategy is, as well as what the role of individuals in making it happen.
A common problem that occurs when plans are submitted by individual teams and combined into one strategic plan is a lack of alignment. Department managers need adequate time to discuss how their individual team activities support and cascade from the strategies of the business. They also need to learn how strategies and initiatives are integrated with other teams, and request what they need from others to achieve their goals.