Strategy Implementation/Execution
Abdullah - 2306188140
Raffi Fafian Chairul Putra - 2206007751
Agenda
Definition of Strategy Implementation
Conceptual Framework
Obstacles of Strategy Implementation Success
Strategy-to-Execution Gap
Effective Executive
Strategy Implementation Effectiveness
1. Visions and strategies that are not actionable
2. Strategies that are not linked to departmental, team,
and individual goals
3. Strategies that are not linked to long- and short-term
resource allocation
4. Feedback that is tactical, not strategic
The Four Barriers to Strategy Implementation
Source: The balanced scorecard : translating strategy into action I Robert S. Kaplan, David P. Norton
Definition
01
The heart of execution lies in
the three core processes: the
people process, the strategy
process, and the operations
process. (Larry Bossidy, Ram
Charan)
Strategy implementation
involves a broad range of
efforts which focus on the
transformation of strategic
intentions into action (Miller
and Dess, 1996)
Source: Bossidy, L., Charan, R. & Burck, C. (2002). Execution: The Discipline of Getting Things Done.
02
03
As for Noble (1999), strategy
implementation is defined as:
The communication,
interpretation, adoption, and
enactment of strategic plans
For Wheelen and Hunger
(2012), implementing a strategy
involves taking ideas, decisions,
plans, policies, objectives and
other aspects of the chosen
strategy and implementing
them into action
Example of conceptual models
in strategy implementation
Pryor et al (2007)
Conceptual
framework [5P's
Model]
ryor et al. (2007)
advocated the inevitable
intertwined elements of
culture, organization,
people, and systems for
strategy implementation
and put forward a broad,
process oriented
interpretation of these
elements in the form of
"the 5P's model of
strategy implementation"
Source: M Hourani. (2017). Conceptual Frameworks for Strategy Implementation: A Literature Review
Strategy Implementation
using OKR
OKRs Are Not New, They Are Best Practice
Andy Grove creates
OKRs to execute
Operation Crush at Intel
1970’s
John Doerr introduces
them to Google and
they’re adopted
Google becomes pretty
successful over the next
20 + years
OKRs become a
best-practice goal
setting framework
1999
2000’s
Today
Doerr’s formula
I will (Objective) as measured by (this set of Key Results)
So, as the name implies, OKR has two components, the
Objective and the Key Results:
Objectives are memorable qualitative descriptions of what
you want to achieve. Objectives
should be short, inspirational and engaging. An Objective
should motivate and challenge the
team
Key Results are a set of metrics that measure your progress
towards the Objective. For each Objective, you should have
a set of 2 to 5 Key Results. More than that and no one will
remember
them.
Source: Viktoria S, J.H Gundelsby, R Ulfsnes, Nils B. (2022). How agile teams make Objectives and Key Results (OKRs) work
The success story behind OKRs at Google:
Strategy Implementation
using Balanced Scorecard
Definition
1.
The balanced scorecard (BSC) was introduced in 1992 as a tool to improve managerial
insight into organizational performance. Since then, the BSC has been hailed as a widely
used and highly influential management tool
2.
The Balanced Scorecard emphasizes that financial and nonfinancial measures must be part
of the information system for employees at all levels of the organization
3.
The BSC is like the dials in an airplane cockpit: it gives managers complex information at a
glance
Source:
1. The balanced scorecard, competitive strategy, and performance Business Horizons | E.M. Olson, S.F. Slater
2. The balanced scorecard : translating strategy into action I Robert S. Kaplan, David P. Norton
3. The balanced scorecard — Measures that drive performance Harvard Business Review | R.S. Kaplan, D.P. Norton
The Balanced Scorecard as a
Management System
The Balanced Scorecard is more than a tactical or an operational
measurement system. Innovative companies are using the scorecard as a
strategic management system, to manage their strategy over their long run.
They are using the measurement focus of the scorecard to accomplish
critical management processes
1. Clarify and translate vision and strategy
2. Communicate and link strategic objectives and measures
3. Plan, set targets, and align strategic initiatives
4. Enhance strategic feedback and learning
Source: The balanced scorecard : translating strategy into action I Robert S. Kaplan, David P. Norton
Linking Multiple Scorecard Measures to a
Single Strategy
Many companies may already be using a mixture of financial and nonfinancial
measures, even in senior management reviews and to communicate with
boards of directors
Cause-and-Effect Relationships
A strategy is a set of hypotheses about cause and effect. The
measurement system should make the relationships (hypotheses)
among objectives (and measures) in the various perspectives explicit
so that they can be managed and validated. The chain of cause and
effect should pervade all four perspectives of a Balanced Scorecard.
Example: improved OTD is expected to lead to higher customer
loyalty, which, in turn, is expected to lead to higher financial
performance. So both customer loyalty and OTD are incorporated into
the customer perspective of the scorecard
Source: The balanced scorecard : translating strategy into action I Robert S. Kaplan, David P. Norton
Example of BSC Implementation in Indonesia
Balance Scorecard (BSC) Method in Performance
Management of the Ministry of Finance-DJKN:
Framework and Visualization of Strategy Maps
In public sector organizations, BSC can be used to
monitor and evaluate organizational performance
from an internal perspective, customer
satisfaction/service, financial and other perspectives.
In the Ministry of Finance itself, especially the
Directorate General of State Assets (DJKN), there are
4 perspectives used, namely Stakeholder
Perspective, Customer Perspective, Internal Process
Perspective and Learning & Growth Perspective
https://www.djkn.kemenkeu.go.id/artikel/baca/15137/Metode-Balance-Scorecard-BSC-dalam-Pengelolaan-Kinerja-Kementerian-Keuangan-DJKNKerangka-dan-Visualisasi-Peta-Strategi.html
Kurt Verweir (2014) : five root causes for unsuccessful
strategy implementation”:
Obstacles of
Strategy
Implementation
Success
• There is too much focus on financials in strategy
discussion.
• Functional strategies are not substitute for a business
strategy.
• Strategy implementation is too fragmented.
• Managers communicate about strategy but forget to
translate strategy into action.
• Strategy implementation requires leadership capabilities.
How to Build a Coherent Enterprise & Avoid Strategy-to-Execution Gap
Five Acts of Unconventional Leadership
- Leinwand, P & Mainardi C. (2016) CONVENTIONAL
WISDOM
UNITENDED CONSEQUENCES
THE FIVE ACTS
Focus on Growth
Getting trapped on a growth treadmill: chasing multiple market
opportunities where you have no right to win
Commit to an identity: Differentiate and grow by being
clear-minded about what you can do best
Pursue Functional
Excellence
Striving to be world-class at everything but mastering nothing:
treating external benchmarking as the path to success
Translate the strategic into the everyday: build and
connect the cross-functional capabilities that deliver your
strategic intent
Reorganize to Drive
Change
Falling into a habit of organizing and reorganizing: trying in vain
to change behaviors and create success by restructuring alone
Put your culture to work: celebrate and leverage your
cultural strengths
Go Lean
Cutting costs across the board: starving key capabilities while
overinvesting in noncritical businesses and functions
Cut costs to grow stronger: prune what doesn’t matter to
invest more in what does
Become Agile and
Resilient
Constantly reacting to market changes: shifting direction in the
misguided conviction that if you listen hard and act fast, you will
survive
Shape your future: reimagine your capabilities, create
demand, and realign your industry on your own terms
Source: Leinwand, P & Mainardi C. (2016). Strategy that Works. Harvard Business Review Press.
What Makes an Effective Executive?
- Peter F. Drucker (2006) What needs to be done?
Gave them the
knowledge they needed
What is right for the enterprise?
Develope action plans.
Convert this knowledge
into effective action
Took responsibility for decisions.
Took responsibility for communicating.
Focused on opportunities rather than problems.
Ran productive meetings.
Thought and said "we" rather than "I."
Ensured that the whole
organization felt
responsible and
accountable
Strategy
Implementation
Effectiveness (SIE)
• The extent to which an
organization’s implemented
strategies correspond to its
strategic intentions (Lee &
Puranam, 2016).
Source: Alex, et. Al. (2020)
Aggregate
Dimensions
Managerial
Actions
Actions through which managers
influence the implementation process.
These actions are used by managers to
communicate, adopt, and enact a
strategy or a strategic initiative
Conditions
Conditions represent dimensions of the
emergent state that result from
managerial actions and define three
critical components required for SI
effectiveness. These conditions explain
how managerial actions ultimately
impact SI effectiveness
Dynamic
Managerial
Capabilities
The underlying managerial capability to
create the best possible combination of
conditions by enacting the most
appropriate managerial actions
Alex, et. Al. (2020)
Tawse, A., & Tabesh, P. (2021). Strategy Implementation : A Review
and an Introductory Framework. European Management Journal
Definitions
Alex, et. Al. (2020)
Dynamic Managerial Capabilities Category
Definitions
Managerial Cognition
“Knowledge structures” that determine how managers understand the
implications of different choices (Garbuio, King, & Lovallo, 2011)
How well managers anticipate and understand the process through which
available actions will impact SI effectiveness.
Managerial Social Capital
“Consists of goodwill derived from relationships, both formal and informal, that
managers have with others and can use to obtain resources and information”
(Helfat & Martin, 2015, p. 1286).
Managerial Human Capital
Focuses on the knowledge, education, experience, and skills of managers (Helfat &
Martin, 2015; Hitt & Ireland, 2002; Wright, Coff, & Moliterno, 2014).
Source: Tawse, A., & Tabesh, P. (2021). Strategy Implementation : A Review and an Introductory Framework. European Management Journal
Alex, et. Al. (2020)
Managerial Actions Category
Definitions
Structural Actions
“The effects of the formal organizational structure and control mechanisms on
implementation processes and outcomes” (Noble, 1999, p.120).
Factors such as policies, procedures, controls, systems, and programs
Interpersonal Actions
Formal or informal human interactions that influence the feelings
and actions of others. (Skivington & Daft, 1991)
Activities such as “facilitating,” “championing,” “influencing,” “selling,”
“discussing,” “coaching,” “team building,” and “supporting.”
Tawse, A., & Tabesh, P. (2021). Strategy Implementation : A Review and an Introductory Framework. European Management Journal
Alex, et. Al. (2020)
Conditions of Effective SI Category
Definitions
Competency
Based on theories of the firm (e.g., Hamel, 1990; Sanchez & Heene, 1997), the
condition of competence refers to the knowledge, skills, and abilities required to
execute tasks that support strategic objectives.
Commitment
The extent to which organizational members are determined to execute their
implementation responsibilities and support strategic goals (Noble &
Mokwa, 1999).
Coordination
The “process of interaction that integrates a collective set of interdependent
tasks” (Okhuysen & Bechky, 2009, p. 463).
Tawse, A., & Tabesh, P. (2021). Strategy Implementation : A Review and an Introductory Framework. European Management Journal
THANK YOU
Reference
1. Bossidy, L., Charan, R. & Burck, C. (2002). Execution: The Discipline of
Getting Things Done. [p. 1-8 and 20-31].
2. Drucker, Peter F. (2017). The Effective Executive. [Foreword and
Introduction]
3. Leinwand, P & Mainardi C. (2016). Strategy that Works. Harvard Business
Review Press.
4. Maher, Hourani (2017). Conceptual Frameworks for Strategy
Implementation: A Literature Review. Macrothink Institute
5. Tawse, A., & Tabesh, P. (2021). Strategy Implementation : A Review and an
Introductory Framework. European Management Journal
6. Viktoria S, J.H Gundelsby, R Ulfsnes, Nils B. (2022). How agile teams make
Objectives and Key Results (OKRs) work
7. M Hourani. (2017). Conceptual Frameworks for Strategy
Implementation: A Literature Review