The document outlines key factors for executing strategy successfully: 1) It identifies 8 components of an effective strategy execution process including strong leadership, clear accountability, and resources to drive execution. 2) It discusses translating strategic plans into actionable plans by defining objectives, responsibilities, and timelines to implement changes. 3) HR can help by identifying talent needs, building core competencies, structuring work to promote collaboration, and linking rewards to strategic targets. 4) Building an organization capable of execution takes time and focuses on leadership, communication, clarity of roles and responsibilities, and performance management.

1. Execution of the Strategy Plan
September 20, 2011
This document intends to share author’s learning, ideas and personal
reflection on the topic. If you intend to quote or replicate any part of this
presentation, acknowledgement of this document and other authors
cited in this document as your sources would be greatly appreciated
1

2. Out of 197 companies surveyed, none met
their multi-year projections
30%
Plan 2005
25% Plan 2004
Plan 2003
Performance (Return on capital)
Plan 2002
Plan 2001
20%
15%
10%
5%
0%
2000 2001 2002 2003 2004 2005 2006
Source: Crafting and Executing Strategy, Thomson, Strickland III,
Gamble 2

3. More than 1/3 of companies surveyed placed
their performance realization at less than 50%
Companies typically realize only about 60% of their strategies’
potential value because of defects and breakdowns in planning
and execution
– Michael Mankins and Richard Steele, Marakon Associates
3

4. Session objective
• To outline key factors that enable a well-executed strategy
• To identify key areas that HR can really help the organization perform at
their best
4

5. Table of content
• What is a strategic plan
• How to translate a strategic plan into action plan?
• What is HR’s (your) role?
• Key takeaways
5

6. What is a strategic plan and why do we need
it?
• What is a strategic plan?
– A long-term business plan that outlines its vision, purpose and goals for
a finite period of time – typically 3 – 5 years
– A roadmap for the organization so to achieve its vision, fulfill its purpose
alongside with meeting financial goals and shareholder requirement
• Why do we need it?
– Provide its stakeholders with a clear direction of growth
– Enable trade-offs, resource allocation and decision making on day to
day activities and investment
– Provide a set of criteria and framework around which the appropriate
new opportunities can be identified for pursuit
6

7. What is good strategy versus a well-executed
strategy?
• What is a good strategy?
– Creates uniqueness, differentiation for customers that is hard to emulate
– Creates value for not only the customers and shareholders but key
stakeholders (suppliers, community, government etc)
– Leverages one’s strengths to exploit opportunities and mitigate threats
and enables the organization to learn and progress through optimization
of resources
• What is a well-executed strategy
– Strategy is understood by the entire organization and aligned with
everyone’s objectives with measurable outcomes
– Functions and business units are aligned and work collaboratively
– Results are reviewed and courses are adjusted accordingly to achieve
the objectives
– Outcomes are delivered
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8. The strategy-making and strategy-executing process
is neither a linear process nor annual process
Creating a Monitoring
strategy to Implementing development,
Developing a Setting evaluating
strategic achieve the & executing performance &
Objectives
vision objectives the strategy making corrective
and vision adjustments
Revise as needed in light of actual performance,
changing conditions, new opportunities and new
ideas
Source: Crafting & Executing Strategy (Book)- Thomson, Strickland and Gamble 8
p.20

9. A second-rate strategy perfectly executed will beat a
first-rate strategy poorly executed
Richard M. Kovacevich, Chairman and CEO Wells Fargo
9

10. Table of content
• What is a strategic plan
• How to translate a strategic plan into action plan?
• What is HR’s (your) role?
• Key takeaways
10

11. The eight components of strategy execution
process Building an
organization with the
Exercising strong competencies,
leadership to drive capabilities, and Marshalling
execution forward resource strengths to resource behind
and attain execute strategy the drive for good
operating successfully strategy execution
excellence
The action agenda
Instilling a corporate for implementing
Instituting policies
culture that and executing
and procedures
promotes good strategy that facilitate
strategy execution What to change or strategy execution
improve
How to get it done?
Tying rewards and Adopting best
incentives directly to practices and
Installing information
the achievement of striving for
and operating
strategic and continuous
systems that enable
financial targets improvement
company personnel
to carry out their
strategic roles
proficiently
Source: Crafting and Executing Strategy, Thomson, Strickland III,
11 Gamble p. 362

12. Where the performance goes??
inadequate poor senior uncom m ited
leadership unapproved strategy
consequences or leadership
2% 1% other obstacles
inadequate redraws for failture 3%
(including inadequate
performance or success skills & capabilities)
monitoring 3% 1%
3%
organizational
silos and culture
blocking execution
4%
unclear
accountability for
execution
4%
actions required to Average realized
execute not clearly performance
defined 62%
5%
poorly
communicated inadequate or
strategy unavailable
5% resources Source: Crafting and Executing Strategy, Thomson, Strickland III,
Gamble 12
7%

13. Table of content
• What is a strategic plan
• How to translate a strategic plan into action plan?
• What is HR’s (your) role?
• Key takeaways
13

14. Let’s think about your role…
• Gaps
• Possible role / actions
• What is required? Ease of implementation ? Timing
• How do you know you are successful
14

15. Let’s think about your role…
Gaps Possible role Ease of implementation / What is How do you know
required / Timing you are
successful?
Inadequate For human resources – identify talent and Use current talent review session to match
resources skill set pools; help prioritize current people with strategic priorities
resources allocation to strategic priorities; Identify gaps – and build a recruitment /
identify gap and build a plan to recruit, outsource plan for 2012 in the next 3
outsource to close the gap months
Not all gaps will be close – short-term
outsource ; long-term need to decide the
appropriate model
Relevance Be the coach and facilitator between Map out key employee groups (levels or Everyone has an
of strategy strategy / planning and employee groups functions) – 2 weeks MBO
to that help use their language to translate Schedule workshops to translate strategy Part of annual
functional strategy into meaningful actions into people’s objectives and actions employee Survey –
activities (objective to ensure everyone understands clarity of roles and
unclear what they need to do in their own language responsibilities
and is aligned) – 2 months
Organizatio Work with senior executives to drive Create a series of corporate events that Part of the annual
nal silos employee communication on company highlight corporate values and have employee survey
and direction and morale; competition to encourage employees to
resistance Develop a culture of collaboration – help submit
to change – drive employee events that break down Work wit h senior leadership to coach them
suboptimal siloes to drive change top down
outcome Revisit incentive system that is not Long-term review incentive system
individual based
15

16. Three components of Building an Organization
Capable of Proficient Strategy Execution
• Putting together a strong management team
• Recruiting and retaining talented employees
Staffing the organization
• Developing a set of competencies and capabilities suited
Building Core to the current strategy
Competencies and • Updating and revising this set as external conditions and
strategy change
Competitive Capabilities • Training retraining employees as needed to maintain skills-
based competencies
Matching the • Instituting organizational arrangements that facilitate good
Organization Structure strategy execution
• Deciding how much decision-making authority to push
to Strategy down to lower-level managers and front line employees
Source: Crafting and Executing Strategy, Thomson, Strickland III, Gamble p. 364
16

17. Structuring the Work Effort to Promote
Successful Strategy Execution
Decide which value chain activities to perform internally and which ones to
outsource
Make internally performed strategy –critical activities the main building
blocks in the organization structure
Decide how much authority to centralize at the top and how much to
delegate to down-the-line managers and employees
Provide for cross-unit coordination
Provide for the necessary collaboration with suppliers and strategic allies
Source: Crafting and Executing Strategy, Thomson, Strickland III, Gamble p. 374
17

18. Trends - Five tools of organizational design
• Managers and workers empowered to act on their
own judgments
• Work process redesign (streamline)
• Self-directed work teams
• Rapid incorporation of Internet technology
applications
• Networking with outsiders to improve existing
organizational capabilities and create new ones.
Source: Crafting and Executing Strategy, Thomson,
Strickland III, Gamble p. 384
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19. Table of content
• What is a strategic plan
• How to translate a strategic plan into action plan?
• What is HR’s (your) role?
• Key takeaways
19

20. Building an organization that executes well
takes time
Key success factors Role
• Coach
• Leadership
• Communication • Relentless communicator
• Clarity, simplicity and relevance • Facilitator with an understanding
employees’ levels, roles and needs
• Accountability and performance
management
• Performance management & coach;
Incentives system designer
• Measurement
•
Monitor of key people measurements
and linkages with performance
Baby steps – pick a few key tasks and do them well
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