Every business, whether it manufactures tires or provides tax-consulting services, has to maintain control of three essential resources – people, processes and finances. Business leaders should have a vision of how these resources will help shape the company’s future; in turn, everyone throughout the organization should know what that vision is. Businesses move forward by matching this vision against the execution of specific strategic goals (ideally, no more than three to five in a fiscal year).
All of the above is true on paper.
The sobering facts are different. According to Skip Reardon’s Six Disciplines blog:
- 85% of management teams spend less than one hour a month on strategy issues.
- Only 27% of a typical company’s employees have access to its strategic plan.
- 60% of typical organizations do not link their strategic priorities to their budget.
- 90% of well-formulated strategies fail due to poor execution.
Where do things break down? Here are a few key areas:
Because so little time gets spent on strategy issues, this part of the business is considered unimportant and a distraction from more “pressing” matters. Some CEOs fear too great a focus on strategy causes them to take their eye off the ball—that is, the day-to-day operations of the business.
Normally, the strategic planning process doesn’t coincide with budget planning. As a result, many strategic initiatives fail to get included in the budget so there’s no link between the two and the initiatives quickly fall by the wayside.
Even the best strategies fail without an “executive champion” in the organization who is accountable for pushing them forward.
If any of this sounds familiar to you, it’s important to answer these questions:
- Do you have a simple and clearly defined vision for your company?
- Does everyone within the organization know what it is?
- How much is the lack of strategic planning costing your business?
- Without execution on strategy, how can your business hope to dominate in its space?
CNC Strategy Cloud Solutions provides companies with strategic diagnostics via the cloud, which help them better understand how they are aligned with and executing against their vision and strategies.