Why Is Strategy Management So Important?

  |   Strategy Management


Strategy is top management’s plan they believe will lead their organization to achieve its intended purpose. The executive team typically invests many man weeks of time and effort developing their annual strategy. Their strategy is usually translated into many man-years of tactics that are cascaded down to functional departments, or assigned to project teams. Ultimately these tactics become detailed goals that associates throughout the organization are individually held accountable for.


Most leadership teams are fairly good at completing this annual strategic planning process. They also do a diligent job communicating their plan, but often come up short making sure that their plan is translated, understood and agreed to by the associates in their organization. They also fail to translate their strategic plan into tactically aligned and concisely defined associate level goals.


“A recent survey of more than 400 global CEOs found that executional excellence was the number one challenge facing corporate leaders in Asia, Europe, and the United States, heading a list of some 80 issues. Studies have found that two-thirds to three-quarters of large organizations struggle to implement their strategies.” (Sull, Homdes, Sull March 2015)


Failures to align your organization with its strategic plan, followed by the failure to coordinate resources across functions are the primary reasons that cause execution to fall short of plan. Strategy Management is the process designed to prevent this failure from occurring.


To be effective, Strategy Management systems must be able to strike a balance between alignment and agility. Alignment is a top-down approach that drives strategy throughout an organization. Agility requires the sharing of resources across functional boundaries to keep strategic initiatives on track. Failure to strike a balance between alignment and agility results in conflict where hierarchal aligned initiatives take priority. Although many companies have formal cross-functional systems in place, only about 20% of their managers believe they work well.


VIDEO: Donald Sull explains why strategic objectives are poorly understood.


Courtesy of Harvard Business Review




All breakdowns between an organization’s strategic plan and their ability to achieve it are referred to as the Strategy Management Gap. The gap is widened whenever the strategic plan is changed. Compounding the size of the gap further is an organization’s natural resistance to the changes required to execute the new strategy.


Strategy Management

Strategy Management bridges the gap between an organization’s Strategy Execution process and its Performance Management process. This bridge links the strategic initiatives, defined by its leadership team to gain competitive advantage, down to the “No Excuses” individual associate level goals required to achieve them.


Strategy Management begins after the initial strategic plan has been defined by the organization’s leadership team and consists of the following formal planning and execution process:


  1. Alignment – aligns an organization’s current strategies, tactics and goals with its Vision, Mission, Values and Core Competencies
  2. Assignment – creates “No Excuses” accountability for the effective and timely achievement of all aligned strategies, tactics and goals
  3. Management – supports bi-directional contemporaneous feedback between goal Managers and goal Owners that document past actions, current risks, future plans and corrections actions required to stay on course
  4. Achievement – establishes unbiased performance assessments that drive group and associate level recognition and rewards


Breakdown of any step in the Strategy Management process will result in underperformance of the strategic plans. This breakdown in performance is referred to as the Strategy Management Gap. Surveys suggest that only 63% of the financial benefits anticipated from strategic plans will be realized.


Benefits of bridging your Strategy Management Gap

Bridging your Strategy Management gap makes execution 10x more effective. However, bridging the gap to achieve these benefits is the most difficult challenge organizations face. As is true with difficult challenges, the rewards for overcoming them are just as great.


Achieve Competitive Advantage

The best way to assure top and bottom line growth is to achieve a sustainable competitive advantage. Delivering more customer value, at less cost than your competition is the only way to achieve this advantage.


Achieving a sustainable advantage is becoming more of a challenge in today’s world of global competition. Patent laws still offer protection of intellectual property. However, advanced computer based design technologies allow competitors to copy and modify products and processes at light speed that get around existing patents. As product commoditization occurs more rapidly, achieving a sustainable competitive advantage, based solely on products or processes, becomes more challenging.


Organizations that develop several core competencies that complement one another make it more difficult for competitors to duplicate. The synergistic benefits derived from the complementary competencies create the sustainable advantage.


Strategy Management aligns the associates across an organization to develop the targeted core competencies and supporting tactical initiatives that combine to create the sustainable competitive advantage. Strategy Management forms a virtual bridge between Strategy Execution and Performance Management gap that makes your competitive advantage more sustainable.


Manage Strategy Revisions

A primary key to successful strategy management is the effective communication of an organization’s strategy and its translation into lower level group tactics and associate level goals. Automatically cascading company level strategy and group level tactics to the responsible associates across an organization is required to hold everyone accountable.


In today’s world of dynamic changes, an organization’s strategy must be validated on an ongoing basis and revised as necessary to remain competitive. As ongoing changes occur to the organization’s strategy, the corresponding lower level tactical and associate level goals must also be revised. A sound Strategy Management process will assure that these ongoing revisions are made and communicated in a timely manner.


Global companies have the additional challenge of bridging the collaboration gap between associates located anywhere. Strategy Management provides the ability to support communication between these geographically dispersed associates that must work together.


Drive Continuous Improvement

The principles behind lean continuous improvement are sound. In today’s world of global competition, all organizations must achieve continuous improvement in order to survive.


Driving continuous improvement in all organizations by definition requires ongoing change. Existing business processes must be documented and executed. The existing processes must be analyzed using lean principles leading to the development of more efficient processes. These new more efficient processes must then be documented and implemented at which time the continuous improvement process starts over again.


Strategy Management helps organizations drive lean continuous improvement by holding individual associates accountable for conformance to existing processes and successfully completing lean projects launched to drive continuous improvement.


Clarify Goal Scope

Failure to clarify goal scope up front causes confusion that has a negative impact on productivity for the life of the goal. Poorly defined goals force associates to rely on their best judgement in hopes of meeting their boss’s poorly defined expectations. This confusion causes a wrestling match between the boss and associate during their performance review process.


Successful Strategy Management requires concisely defined goals that are aligned to support the organization’s strategies. Properly defining goals enables associates to understand their scope of responsibility and authority. Ongoing management provides them the feedback necessary to stay on track and forms the basis for periodic performance assessment. Concisely defining goals in the first place produces better results and requires less effort to reconcile any misunderstandings.


Achieve Reciprocal Accountability

Strategy Management recognizes that there is a Manager and Owner responsible for each assigned goal. Managers typically define the goal scope, assign the goal Owner, make sure resources are available, review achievements, provide ongoing feedback, support corrective actions and rate the Owners performance upon completion.


Goal Owners are responsible for understanding and agreeing to complete their assignments on time and within budget. Goal Owners should routinely report prior actions, identify current risks, formulate future plans and then pull out all stops to successfully achieve their assigned goals when promised.


Strategy Management places equal emphasis on both the Manager and Owner roles. These dual roles that oversee the outcome of all strategically aligned associate centric goals create the “No Excuses” accountability that increases the probability they will be achieved on time and within budget.


Develop a “No Excuses” Culture

The culture of any organization is established by the behavior of the critical mass of its population. Unfortunately, a prevailing culture that exists in most organizations is a lack of accountability. Poorly defined goals are informally assigned making associate level accountability impossible. In the absence of valid due dates, the relative priority of assignments is left to the whim of each associate. Due dates are regularly missed without consequences. The gap between Strategy Execution and Performance Management becomes so wide; they function independent of one another.


Strategy Management bridges this gap by establishing associate level accountability for the effective and timely achievement of all goal assignments. Peer pressure takes over as accountability is achieved that slowly shifts an organization toward a “No Excuses” culture. Once the critical mass embraces the “No Excuses” culture, the “can’t do” attitude will be replaced by a “can do” attitude. There’s nothing like peer pressure charged with a “can do” attitude that will get things done as required to bridge the Strategy Execution Gap.



Executional excellence is the number one challenge facing corporate leaders throughout the world today. The best strategies are worthless when they can’t be executed. Any shortfall between plan and actual at the strategic level will have significant adverse consequences.


Strategy Management is designed for the sole purpose of bridging the gap between an organization’s Strategy Execution and Performance Management processes. Effectively bridging the Strategy Management gap realizes many benefits that lead to exceptional performance. Failure to bridge the gap results in catastrophic failure. Strategy Management is critical to your organization’s success.