Here's Why Your Organization Probably Isn't Sticking To Its Strategy
Michael DeVenney
January 31, 2022

Each year, leaders and organizations invest time, resources, and money into developing, renewing, and planning their strategies. Consultants descend on the business to apply four-box matrices to determine what to SWOT and how to SOAR, or whatever other model is popular at the time.

So, is it worth it?

We seem to believe it to be. Time is precious and to devote so much attention on our strategies, we must see it as creating value and impact.

Without a doubt, the actual process of strategic planning is valuable itself, due to the discussions and thinking that enable learning and growth. Surely, that professional development creates change and capacity for success.

The numbers say something different. As a strategist, I love strategy. As an analyst, I adore numbers. I felt constricted. Studies show that only about 17% of strategy will result in the outcomes as planned or expected. No wonder people are becoming more disengaged and demotivated. All this discussion, and more than 80% of the time, things do not happen as we planned. We get in our own way.

We are experiencing a lot of ‘Big Hat, No Cattle’ syndrome, where there is a lot of talk, but not much application and action for impact.

I believe in strategy, but I do see a flaw in how we are working with it.

Basically, with strategic positioning, leaders are making decisions, and choices, about where attention is to be placed in a balance of revenue generation, innovation, and productivity. Leaders decide what is most important, how to build on the strengths of the business, what challenges need to be resolved to move the company forward, and what opportunities are the best fit for the future of the organization.

Working with leaders, we measured using our custom WorkInsights analytics to assess the confidence in the strategic positioning of their companies for growth. Revenue generation was identified as the most important dimension, not surprising while experiencing the global upheaval of the pandemic. Productivity was seen to be the strength, people are capable, competent, and committed. And innovation, to be honest, overlooked.

Leaders clarified that focusing on revenue generation, by building on strengths and preserving past successes, was the position most supportive of growth at this time.

The sad part was the degree of confidence. Although leaders rated their ability to lead effectively at 76.2%, they did not believe they could influence the effectiveness of the strategic decisions around revenue generation.

Leaders ranked their capacity to impact revenue generation at the lowest rate, just 19.5% (that number may look a bit familiar in reverse, as 80% of strategic initiatives do not provide results as planned). It seems a strategy is set, choices made in the most essential aspect of the business, revenue generation, but we do not believe we can influence the outcomes.

In comparison, the degree of influence felt for innovation was 28.9%, and then at 46.4% around productivity (with the highest level of agreement).

Digging deeper into revenue generation, the lowest levels of perceived influence were in partnering for business opportunities, such as acquisitions, joint ventures, and other investments, and then for marketing being effective for converting leads to clients. The highest level of confidence in being able to influence results, at 23.4%, was in focusing on core offerings, doing what we already do.

So, leaders are committed, but unsure.

How can leaders communicate a consistent and compelling message to their people if there is no belief that it can happen?

But here is something of further interest - the highest level of disagreement around how to grow was in revenue generation. This means leaders have widely varying feelings around the different methods of using revenue generation strategies. If there was a way to reduce the variance, there could be greater confidence and higher success rates.

The ability to outperform, held by only 20% of companies, is explained by alignment. Nearly 70% of the variance of top performers against all others rests in the agreement of leaders on what is most important and where to focus energy, resources, and attention. And with alignment, comes confidence.

Alignment is achieved with data, information that describes perspectives and uncovers the biases and beliefs of the senior leaders and everyone in the business. With clarity of data, leaders know what is happening, why it is happening, how it is playing out, and what should happen next. And with quantitative and qualitative data, leaders can uncover the perspectives and the sentiment underneath. Now decisions can be made knowing how people think and feel, being clear on the mindset of the team and organization.

With data comes greater confidence in the ability to influence outcomes. In fact, outperforming companies achieve three times the success of other companies, working from clarity and focus, founded in awareness, understanding, and commitment – resulting in informed decisions that are followed through on.

This does not mean we can predict the future, or manipulate the market, nor control the outcome. But we can be confident in our own actions, doing what we know will have the greatest impact, and aligned around a shared understanding of what needs to happen. Scenario planning with data around the key factors of strategic positioning builds adaptability, agility, and vitality for a more engaged and resilient organization, one that is more confident in being proactive in responding thoughtfully to markets and events.

Strategy is worth the time and attention, although we need to shift our approach to broaden and deepen our understanding of the perspectives of people, so we can commit to positions that fit our business (not a model).

Ah, the answer is the combination of strategy and analytics, as a strategist and an analyst, my heart soars.

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