With the New Year upon us, it’s time to reflect on the top trends in Strategy Execution Management from 2022.
Strategy execution is not a new topic. It has been around for decades and is recognized as one of the most challenging aspects of strategy. However, we are seeing it move up the corporate agenda. It’s no wonder that directors rate strategy execution as a top priority for improvement in their organisation.
The way leaders are managing and executing strategy has changed dramatically in a post-pandemic world. 2022 has seen an increase in remote and hybrid working. Therefore, alignment around strategy and execution has never been more important. Here are the top 10 trends we have seen gain traction over the past year.
1 – Collaboration – Strategy is no longer just top-down, confined to the closed doors of a boardroom. Employees are becoming part of the creation AND execution of strategy. Employees from different departments, and even sometimes people from outside of an organisation are coming together to share information and work together toward a common goal. Because of this, there is a greater need for a more collaborative working environment, with clear, open communication and access to shared information.
2 – Transparency – In today’s complex and uncertain environment, it is more important than ever to be clear on a company’s direction and focus. Transparency not only enables collaboration and communication, but it also helps companies be adaptive. In markets where everything is always changing, the way a company might want to reach its goal can also change, and things can change quickly. Having a clear direction and focus helps channel all employees’ efforts towards it and keeps everyone on the same page.
3 – Data – Digitisation and analytics have become a key enabler in strategy formulation, with data underpinning the decision-making process. Use of data and analytics has made the strategy formulation and strategy execution process more efficient and effective.
4 – Adaptability – Greater uncertainty means a need for greater flexibility in our approach to strategy and execution. And with so much uncertainty around the globe, strategies are now less long-term in nature than they used to be 5-10 years ago. Markets are now more volatile and unpredictable, having had to adapt to the pandemic, wars, recessions, interest rates, oil shortages, to name a few. This makes it very difficult to plan into the long term. Goal posts are ever changing, so you need flexibility to adapt to those changes, be able to re-align resources quickly and assess those risks and what-if scenarios to help make and adapt the decision-making process. Strategy has become a hypothesis to be tested, not a plan carved in stone.
5 – Sustainability – Strategies are becoming more focused on sustainability and social impact than they were a few years ago.
6 – Speed – Uncertain environments create a need for speed, and strategy cycles have become shorter than they were 5-10 years ago. There has been an increasing movement away from Waterfall and towards Agile Innovation. Markets are faster, tougher, and less predictable with a lot more competition. There are many more uncertainties and risk in new product development, and true innovation is much harder to come by. Speed and agility are key in these fast-paced, ever-changing markets.
7 – What-if scenarios – In such uncertain and fast-changing environments, a greater consideration of alternative scenarios is important. Use of data and evidence to consider unintended consequences and to look beyond the surface are on the rise.
8 – Improved data-visualisation – Previously, project managers were relying on infinite spreadsheets with tedious amounts of data presented in rows and columns. Today, thanks to the latest solutions, you can create customized dashboards with vibrant and engaging visual representations, including colourful charts, graphs and histograms, presenting the most up-to-date information in a visual and digestible format.
9 – Stage and Gate (or Phase Gate) processes – The need for stages and gates, or Phase Gate models is on the rise, especially Agile Phase Gate approaches. The basic idea of Phase Gate is to break the project down into key stages, each with a key focus to help define and progress the development of the new product. Implicit in this is the concept of reducing risk and managing investment to avoid costly and wasteful mistakes. Between each of the stages are the gates – decision points on whether to allow the project to continue further, into the next stage. Undoubtedly the benefits of phase gate software are substantial. Without a clear process, strategy execution is hard to do well.
10 – And lastly, the use of Software – The hard part of strategy is decision-making. So naturally using software that enables decision making is on the rise. Decision-making is enabled when you have access to software that can analyse what-if scenarios and help you to manage risk. It increases learning, collaboration, and speed. How do you decide which opportunities to go after, and which not to? As Steve Jobs used to say, “The quality of your decisions is indicated by the quality of ideas you’ve rejected. It’s easy to say no to bad ideas, but great decisions come from saying no to good ideas.” Strategy is similar – sometimes you need to say No to the good ideas, so that you can focus time and resource on the great ones.
Strategy Execution Management is imperative for a company’s success. We are seeing Strategy Execution Management move up the corporate agenda and become a top priority for executives.
Interestingly, but not surprisingly, Google Trends shows a steady growth of worldwide use of the search term “strategy execution” over the past ten years. There has also been increased attention to strategy execution across the globe. Research and advisory company Gartner have recently started to cover it as an important topic to write about. Since 2019, for example, they have published a series of articles around Strategy Execution. For example, Successful Strategy Execution in a Complex World, The 5 Pillars of Strategy Execution and Strategy’s New Execution Mandate. Given that Gartner is not alone in this increased coverage of strategy execution, there is definite recent growth in attention to the topic.
Also contributing to the growing interest may be that strategy execution has become more difficult. Markets have become more volatile and less predictable, competition is fiercer, employee and customer demands are on the increase. As Gartner puts it, “strategy execution has become more challenging due to more cross-silo coordination, a fast-changing and uncertain landscape, and more decision makers to include in the process”.
Trends in strategy execution may also have growing interest because executives and managers are simply more aware of them, and the importance of strategy execution.