Business Strategy Execution – Building Blocks

Leadership Skills, Organizational Change, Human Capital Management

Sep 10, 2009 Wayne Smith

Execution is an art. It is a matter of leadership, culture change and choosing the right people for the right jobs.

Execution is a good deal more than business management. It is a matter of getting results. And results have never been more important than they are in today’s global economy. Unfortunately, too many companies are unable to bridge the gap between the goals they set in their business plan and the results they need for success.

In their book, Execution: The Discipline of Getting Things Done, former Honeywell CEO Larry Bossidy and renowned management consultant Ram Charan describe the building blocks for execution. In their view, execution must become the driving value in the organization – a cornerstone in its culture – and the unifying theme for all levels of leadership.

Execution goes well beyond the scholarly work in management techniques and strategic thinking. It is a mindset that includes dialogue with subordinates, truly understanding the business at all levels, development of talent and relentless focus on goals and milestones.

Three Key Principles for Business Strategy Execution:

  • Execution is a discipline: It is a systematic process of operational planning, follow through and accountability.
  • Execution is the main job of the leader: Even leaders at the very top must be personally involved in the details of running the business.
  • Execution must be a core element of the business culture: It must be embedded in reward systems, norms and behaviors throughout the organization.

In addition, there are three building blocks for execution.

Building Block 1: Leadership Skills for Execution

Bossidy and Charan define seven essential behaviors that will enable leaders to be keenly in touch with their business and yet avoid becoming micromanagers.

  • Know the people and live the business.
  • Insist on realism.
  • Set clear goals and priorities.
  • Follow through.
  • Reward the doers.
  • Expand people’s capabilities.
  • Know yourself.

Building Block 2: A Framework for Organizational Change

Culture change only works when it is linked to improving execution. Change that is not directly tied to outcomes will have no impact. This often requires a new way of thinking. But to achieve new thought paradigms, it is first necessary to put them into action. New ways of thinking follow new ways of acting.

Next, leaders should focus on what gets rewarded in the organization. Linkage of rewards to performance is the foundation of behavior change. But leaders should not focus solely on the numbers when building reward systems. They also should also consider desirable behaviors – those that lead to increased capability for execution – so that people will get stronger. Over time, financial results will reflect this increase in employee capability.

Building Block 3: Putting the Right People in the Right Places

Many leaders proclaim that “people are our most important asset,” but few put sufficient thought into the critical process of choosing the right people for the right jobs. The leader must ensure that the organization maximizes its human capital, because the judgment, capability and experience of its people make the difference between success and failure. Why do employees end up in the wrong jobs? Here are some mistakes that leaders make.

  • Lack of knowledge: Leaders sometimes lack thorough knowledge of candidates for critical jobs and rely on inadequate staff reports. Or sometimes they commit one of several appraisal errors, such as stereotyping, the recency effect or projecting their own values onto the candidate.
  • Lack of courage: Sometimes leaders lack the moral courage to confront an underperformer and usher in a replacement. This lack of conviction can cause significant damage in the organization, especially if the non-performer is highly placed.
  • Psychological Comfort: Often leaders promote people with whom they are comfortable or who have demonstrated loyalty. Sometimes, however, breaking away from the comfort factor is just what is required to bring about change.

To be strong in execution, leaders cannot be detached from the workings of the organization. Also, they must develop the necessary skills and experiences both in themselves and in others. Both they and the organizations they lead will benefit.

Reference

Bossidy, L. & Charan, R. (2002) Execution: The Discipline of Getting Things Done. New York: Crown Business.

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The copyright of the article Business Strategy Execution – Building Blocks in Business Management is owned by Wayne Smith. Permission to republish Business Strategy Execution – Building Blocks in print or online must be granted by the author in writing.
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