So (you and) your people don't understand your strategy?

Apr 20, 2016

Oh boy. A new study by Maarika Maury in Finland highlights that only 13% of top management, 8% of middle management, and a sad 2% of other employees are able to articulate the strategy of the company as it stands. 

And this is no random observation: the study ran for several years 2010 - 2016, included some 150 organizations in different industries, and engaged almost 10 000 respondents altogether.

What's more, I've got several other studies since the early 1980s summarized, where the focus has mainly been in learning how well strategies are getting implemented:

So what's wrong?

Well, for one, if you don't know or understand your strategy, it's pretty hard to implement it, right? Combining the analyses of the same studies - and then some - with my own experience, I believe all those failures are mainly due to just four major problems:

Lack of Foresight

Inability to communicate what you believe your future business environment will be like. This is crucial for understanding the rationale for your strategy, where a mere one third of top executives believe their organization is reasonably equipped.

Lack of Roadmap

Sticking to "strategic jargon" and not focusing on really visualizing your target and the path towards it. This is highly important for commitment and buy-in that needs to reach at least 50% for execution acceleration.

Lack of Alignment and/or Decisiveness

Failing to connect your strategic roadmap with concrete daily choices and activities. Or failing to follow through those tough choices of e.g. letting go of some of today's opportunities for the benefit of the long term targets.

Lack of Leadership

Shortcomings in building and nurturing the corporate culture, and in specific, in organizing and putting the right people in the right positions: you need to accept that people ultimately come first, strategy second (as a strategy enthusiast it almost hurts me to say this but even I know this is right!).

Strategy matters, and it matters a lot. I believe it is necessary for success - but not sufficient. Success is just as much about execution, decisiveness, follow-through, and leadership.

Regarding my own small team, I am especially proud of our ability to take brave decisions also in letting go of the past and being consistent with the choices made (see point 3 above). I also think we are doing better than average in understanding our business surroundings now and in future (point 1 above). We are struggling most - at least this is how I see it - still with really concrete steps towards our target (point 2 above) and to some extent also with personal roles and division of work, not only among ourselves but also with our expanding network of collaborators.

At our customers, the key questions are sometimes about futures understanding (point 1), sometimes about roadmaps and really acting according to plans (points 2 and 3). I am really happy to say that most of our customers today are well on their way with transparent, modern leadership (point 4), which gives a solid basis for the hard-core strategy and execution stuff also.

How about you, then: are you happy with your performance in all points 1-4 above, both personally and as an organization?

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Panu Kause is the founder and CEO at FIBRES. Before founding FIBRES, he held several management positions and ran his own foresight and strategy focused consultancy.

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