I find it shocking that statistics show 60%-90% of companies fail to execute their strategies.
HBR quotes a survey where more than 400 global CEO’s from Asia, Europe and the United States found that executional excellence was the number one challenge facing corporate leaders. Execution directed the list of 80 issues regarding innovation, geopolitical instability and top-line growth.
Before we get into the reasons why companies fail to execute, let’s agree that most companies fail to execute, and execution is a highly critical issue that companies face.
Success is a combination of brilliant strategy and excellence in execution. With highly refined marketing processes, companies tend to do a very good job building brand plans and marketing strategies.
Therefor execution is the key differentiating factor for success. If you are better in executing than your competitor, then you should take market share from them. In an informal survey of 12 Business Unit Directors where they were asked if they had a formal marketing plan in place, they laughed and said it was added. Consequently, when asked whether they had a formal execution plan in place, they all looked puzzled.
Companies spend several months developing brand/marketing plans, yet the same companies only spend a day or two rolling out these plans and in discussing execution. There is a completely lopsided approach between the times spent on strategy versus time spent on execution.
Before I layout the six reasons why companies fail to execute, I want you to ask yourself the following questions:
Is your team clear on how to execute?
Do you have a process to execute your strategies?
If you can’t say yes to both, I will share with you what you need to do so that you will not be another company that fails to execute.
7 Obstacles in Executing with Excellence
There is a reason why 90% of companies/business units fail to execute. Execution is very difficult. There is no silver bullet. With over 25 years of sales and marketing and business experience I have developed a solid approach to execution. I was never a great strategist but I was damn good at executing. I have helped many companies improve their commercial execution and have several new pilot programs going on this year.
Below you will find my 7 obstacles to great execution. If you don’t clear all 7 obstacles you will be one of the 60-90% of companies that fail to execute.
On the bright side, knowing what the obstacles are will give you an opportunity to review what you are doing and allow you to make course corrections.
Business Execution Process
All important business endeavors require some type of process. An example of a well-tuned process that successful companies utilize is the annual marketing plan process. Execution is a full year process starting with the marketing plan, building the execution plan, leading execution and keeping the plan on track.
What are the chances you don’t have a formal process? If you don’t, then no need to read the following six points as you will fail to execute!
Clarity on What’s Critical for Success
Most companies try and do too much. If you try and do too many things you can’t do them all well. My approach to success in business is figuring out the 3 most important things you need to do to achieve your goals and doing them extremely well.
Execution is the discipline of getting the most important things done.
If you can clearly articulate the 3 things you and your team need to do to be successful, then give yourself a point. If not, you are going to fail to execute with excellence. Fail!
Execution is a team sport. Excellence requires alignment of not only sales and marketing but other support departments. You need operations, production, business analytics, and all other support departments. The key is the need to be aligned on the critical success factors. All departments need to know what their CSFs are. They need to ensure that their departments have plans and can support the commercial unit on their critical success factors.
You also need to be sure that your sales management teams are aligned with the critical success factors. There have been too many incidents where I ask the business unit head to share their critical success factors with me.
I then ask their sales managers what the critical success factors are. Many times, they have identified relevant CSFs. However, if they are not aligned with the business and the other sales managers there is no way that you are going to execute with excellence.
If you team is not aligned forget about it!
Ownership of the Plan
Have you passed the last three obstacles? Even with a plan in place and having your team aligned, without ownership of the plan you are doomed. You are probably ready to give up at this point. Don’t despair, getting ownership to any plan is not that difficult. No one wants to be told what to do, but they do want to have input on the plan. All you need to do is make them part of the process then they will have ownership. The key is bringing all stakeholders to the planning process to make them the architects of the plan.
One of the final ingredients is having leadership from the front line to keep the sales people focused on what is important. When salespeople tell you that they are very busy the likelihood is that they are. Your front-line sales managers are also very busy. It is incumbent on them to lead the way. Your sales managers are the key to sales execution. When they see their salespeople off track or spending too much time on non-critical areas they need to bring them back so that they can focus on the critical success factors.
Well Defined Metrics
A colleague once told me that people respect what you inspect. The key is every executable item whether it is execution of a program or if a specific deliverable needs to be measured. Let’s say you are having a customer conference and it is up to your sales people to get customers to attend, you need to give each of them a target.
As a commercial leader you know that if you don’t measure it people don’t do it. Review your plan and make sure you have built a scorecard of all the key deliverables and provide metrics for each.
Quarterly Review Meetings
The last and possibly most important hurdle goes hand in hand with having defined metrics is also having quarterly business review meetings. The objective of these meetings is to review the scorecard. Having each of the sales managers, marketers and support department heads present how they are doing versus the metrics and what they intend to do over the next quarter is essential. Have a look at How to Conduct an Impactful Quarterly Business Review Meeting.
Execution is not a science or an art, it is a discipline. If you don’t have all the ingredients in place you stand to be one of the 90% of companies that fail to execute. Take a step back and ask yourself what are you missing to execute with excellence? Go back and review each of the 7 obstacles and see what you can do to positively impact your year.
About the Author
Steven A. Rosen, MBA is the Founder of STAR Results, a leading boutique sales management training and executive coaching company. Steven is also the author of 52 Sales Management Tips – The Sales Manager’s Success Guide.