To address business challenges and concerns, organizations must constantly monitor, evaluate, and adjust their strategic initiatives. When it’s time to implement a new strategy, it’s typically up to managers to do so.
Access your free e-book today.
DOWNLOAD NOWWhat Is Strategy Implementation?
According to the online course Strategy Execution, strategy implementation is the process of turning plans into action to reach business goals and objectives. In other words, it’s the art of getting stuff done.
Your organization’s success rests on your ability to implement decisions and execute processes efficiently, effectively, and consistently. Yet, that’s often easier said than done.
“If you've looked at the news lately, you've probably seen stories of businesses with great strategies that have failed,” says Harvard Business School Professor Robert Simons, who teaches Strategy Execution. “In each, we find a business strategy that was well formulated but poorly executed.”
You can learn a lot from failed strategies, and understanding how to implement a successful one is vital to leading change. Here are steps you can take to effectively roll out your business strategy.
4 Steps in the Strategy Implementation Process
1. Handle Tension
Making tough choices isn’t easy, and you need to manage any tension that arises with change.
In strategy implementation, tension often exists between innovating to grow your business and controlling internal processes and procedures.
For example, leaders at ride-hailing company Uber have faced challenges in balancing growth and control. While Uber has transformed the transportation industry, its need to expand has led to several instances of misconduct due to insufficient internal controls.
You can manage tension and find balance by designing and implementing levers of control, which comprise:
- Belief systems: Organizational definitions you communicate and reinforce to provide direction to employees
- Boundary systems: Negatively phrased statements that tell employees what behaviors are forbidden
- Diagnostic control systems: Formal information systems that help monitor organizational outcomes
- Interactive control systems: Formal systems managers use to involve themselves in subordinates' decisions that impact strategic uncertainties
These levers help create opposing forces throughout strategy implementation that continuously balance each other. While half of them (belief systems and interactive control systems) promote innovation and inspiration, the others (boundary systems and diagnostic control systems) establish boundaries and threats of punishment when employees cross the line.
To ensure your strategy execution succeeds, use the power of tension when designing management control systems.
2. Align Job Design to Strategy
No matter how well-formulated your business strategy is, it can’t succeed without your team. To prime employees for success, it’s essential to design jobs with strategy in mind.
Job design is structuring jobs’ components to enhance organizational efficiency. Its common elements include task allocation, job development, and feedback and communication.
“Job design is a critical part of strategy execution,” Simons says in Strategy Execution. “If individuals don't have the resources they need and aren’t accountable in the right way, they won’t be able to work to their potential.”
According to Simons, you can use the Job Design Optimization Tool (JDOT) to design or test jobs by analyzing their balance of demands and resources.
The tool prompts you to consider:
- What resources do employees have to get the job done?
- What measure will we use to evaluate their performance?
- Who must they influence to achieve their goals?
- How much support can they expect when reaching out for help?
By answering these questions and ensuring they align with your strategy, employees can directly support your initiatives.
3. Inspire Employee Buy-In
Even if you position employees for success through effective job design, you must still gain their buy-in for strategic goals. According to a Gallup survey, organizations with strong employee engagement experience 10 percent greater customer loyalty and 23 percent higher profitability.
You can garner their support by communicating your organization’s core values—its purpose that impacts what employees should do and how they should act.
According to Strategy Execution, effective core values possess two attributes:
- Inspiration: They make employees proud of where they work.
- Guidance: They ensure employees know whose interests to prioritize when making difficult decisions.
Communicating your organization’s core values doesn’t just help bolster support for strategic initiatives; it also provides employees with a purpose to improve performance and workplace accountability.
Another useful tool is ranking systems.
“Ranking systems—which are quite common in practice—have really good features that managers can use to stimulate performance,” says HBS Professor Susan Gallani in Strategy Execution.
Ranking systems provide clear measures—like leadership capabilities—for employees to determine their ownership in your business strategy. Gallani says establishing such measures helps eliminate unknowns that create anxiety.
“What the ranking system does—it takes that shock away,” Gallani says in Strategy Execution. “Everybody's compared at the same level, and that's good because it really highlights the individual contribution of different workers and points out who did better and who did worse.”
By implementing ranking systems, achievement-driven employees can be more likely to invest in your business strategy.
Related: How to Get Employee Buy-In to Execute Your Strategic Initiatives
4. Manage Risk
Even if you take these steps when implementing your business strategy, your initiatives can still fail.
“Competing successfully in any industry involves some level of risk,” Simons says in Strategy Execution. “But high-performing businesses with high-pressure cultures are especially vulnerable. As a manager, you need to know how and why these risks arise and how to avoid them.”
Engaging in risk management—the systematic process of identifying, assessing, and mitigating threats or uncertainties that can affect your organization—is crucial to long-term success.
Three types of pressures that make you vulnerable to risk are:
- Growth
- Culture
- Information management
Business risks aren’t always obvious, making it critical to identify unexpected events or conditions that could impede your organization’s business strategy.
“I think one of the challenges firms face is the ability to properly identify their risks,” says HBS Professor Eugene Soltes in Strategy Execution.
For example, the automotive industry heavily relies on semiconductors. However, due to an unexpected disruption in manufacturing priorities during the COVID-19 pandemic, companies had to navigate production during a semiconductor shortage.
By understanding your strategy’s vulnerabilities, you can prevent failures because of unanticipated events and protect your organization from challenges like increased market competition, evolving technologies, and shifting customer needs.
Learn How to Oversee Strategy Implementation
Implementing strategy successfully is challenging.
By taking an online strategy course, such as Strategy Execution, you can draw insights from real-world business examples and build the strategy execution skills and knowledge to achieve your organization’s objectives.
Do you want to improve your strategy implementation? Explore Strategy Execution—one of our online strategy courses—and download our free strategy e-book to take the first step toward doing so.
This post was updated and republished on January 16, 2024. It was originally published on February 25, 2020.
