Successful business strategy depends on your ability to execute your plan. Is your strategy ready to launch, or doomed to fail?
You've spent a lot of time hammering out your brilliant business strategy, but your execution falls flat.
Why does that happen? How does it happen?
Roger Martin at Harvard Business Review makes the case that there can be no good strategy without execution because strategy is the same as execution.
While I disagree on the semantics, I do see where he's coming from. The first step in your execution is crafting a great strategy, and if execution fails, it wasn't a great strategy.
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Business strategy cannot be an idea framework, it must be an actionable plan. If your business strategy is grounded in dreams, where all ideas work in optimal conditions, you're in trouble before you start. No matter how flawless and beautiful your vision is on paper, the execution is often messy and flawed.
The fastest road to failure is implementing a plan without allocating the resources: money, manpower, training, management, and time. Let's talk about the process and the issues most likely to get in the way of success.
Finding the Weak Links in Your Business Strategy
Success is not magic. You can't go from “First we'll make a plan” to “and then we'll rake in tons of money.” Success happens in between. Here's a real-life example from my past:
In the early 2000s, I worked for an amazing startup. The concept was exciting and brilliant. Working on the idea that auto mechanics spend a lot of time finding parts to fix vehicles, and owners with unusual vehicles often experience repair delays as a result, a young group of entrepreneurs put together a business plan that seemed to have a big future.
Mechanics from giant chains to driveway DIYers would log in, enter a part, and the part would arrive at their door within an hour or two, or the next day if it had to come from across the country. Since parts inventory from sources all over the country would be looped in with local response prioritized, no other effort was necessary.
Dealerships jumped on board. Auto parts chains jumped on board. Investors loved the business model, and threw money at the company like beads from a Mardi Gras float. Stock soared.
Nothing compares to working at a startup on the crest of a wave. It was exhilarating. We were going to revolutionize the auto repair industry! It was a quintessential BHAG – Big, Hairy, Audacious Goal.
A couple of days from launch, reality smacked us right in the face. The business plan was all about developing the concept, building the software, getting dealers on board, and romancing the investors. Seems they'd forgotten to find out if average mechanics were online. With much of the country still suffering dialup connections...they weren't.
A mad scramble followed, and we even offered to provide computers to some of the big auto repair chains, but it was too little and too late. Dazzled by their own brilliant business plan, our execs left out a critical link in the chain. Within a week of launch, the bubble burst, the stock plummeted, and the layoffs began.
In a report sponsored by Project Management Institute (PMI), Michael Astrue, former US Commissioner for Social Security, hit the nail right on the head.
“Commonly [in the public sector], people put strategy together from a theoretical perspective. They have not factored in practical matters such as operational complexity and budget constraints. You need to have people at the top who can integrate all those things. It is a big issue.”
For a small company or startup, the same principles apply. You're more likely to succeed if you can get your employees and your audience excited about your project.
Today, you have to consider your audience part of the team, especially if you're working with a small marketing budget. You can amp up your chances of success by involving your social media followers. Crowdsource decisions, talk about new initiatives and build excitement long before your launch. If you're working on a radical new idea you don't want to share, you can still hint at the customer benefits to come.
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Make Your Strategy Portable
“In tournament poker as well [as a business], you must start with a game plan, and through the course of a tournament, refine and adapt to changes in stack sizes, table dynamics and tournament situations, including ICM (Independent Chip Model used to determine the dollar value of your chip stack as you approach and get in the money). Even within a hand (like a customer sales opportunity) you need to adapt as more information is gained and re-evaluate your plan for the hand on every street.”
While every business strategy is specific to industry and business, some truths are universal. Adaptability has to be baked in. Examine your plan carefully for workability across sectors. Could you use core elements of your plan as poker strategy? If your strategy isn't portable, it may lack substance.
Provide the Means to Success
While the idea that implementing a new plan requires a realistic budget shouldn't really surprise anyone, it's a shockingly common mistake. Good strategy includes a comprehensive cost analysis with a generous margin for error.
Financial sustainability needs to be at the core of your strategy, without making financial constraints the defining construct. When you're discussing your strategy, include a realistic discussion of resources on hand to allocate and revenue strategies you can implement to make up any shortfalls. For every stage of your strategy, ask:
- Can you afford to do this?
- If not, can you realistically find extra money?
- Do you have the budget to sustain the effort until it pays off?
- Do you have enough employees to pull it off?
- Do your employees have the necessary skills?
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Big business or small, the success of your business depends on your vision, and the ability to bring that vision to live. Whether you're launching a new company, a new product, or a new marketing campaign, strategic planning is your best asset. Avoid the potholes with a realistic look at achieving your goals, and a plan that will allow your to roll with the punches, even if the marketing landscape shifts.