Business Case Studies, Executive Interviews, James M Higgins on Strategy Execution

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Executive Interviews: Interview with James M Higgins on Strategy Execution
September 2008 - By Dr. Nagendra V Chowdary


Dr.James Higgins
Dr James M Higgins is Cornell Professor of Innovation Management at Crummer Graduate School of Business
Rollins College Florida.


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  • OnPoint Consulting recently surveyed the gap between strategy and execution. And the results were startling. Of the leaders surveyed: 49% perceived a gap between their strategies and execution (the ability to make their strategies happen), and of these, 64% didn't have full confidence that their companies would be able to close the gap! How to identify strategy execution gaps? At what stage do you advocate such an audit should be carried out? If so, who should carry out the gap analysis so that the company is kept always on the right course?

    Financial results eventually indicate whether execution efforts have been effective or not. However, theymay be also ndicating whether the strategy was sound or not. Surveys are another way to determine whether or not execution and/or strategy have been effective. OnPoint uses a survey based on eight key success factors. Firms can create their own survey based on what they perceive as key factors. Surveys can be delivered by the company or by consultants. But another way is to follow up periodically with direct reports, who in turn follow up with their direct reports. This is an early warming system designed to prevent ineffectiveperformance.

  • After all, no one plans for a failure. Why do you see so many companies' strategies failing? Why don't good strategies result in good results? Drawing from your rich experience and research inputs, what's your advice to companies in making their strategies successful?
    Strategies mostly fail because of poor execution. Firms do not align the 8Ss. They don't recieve commitment fromorganizationalmembers tomake the strategy successful. But on the strategy side, there are plenty of causes of failure as well. Many firms don't respond to changes in the market, in customers, and in environmental factors. They fail to take advantage of opportunities. They are not innovative enough. The strategy itselfmay lack clarity. I also see among failed entrepreneurial firms too much risk taking, and among larger, more bureaucratic firms, too little risk taking. Arrogance among highly successful firms leads to following the same paths when new paths are required. Toomany companies are unwilling to give up what has made them successful but what will not make them successful in the future.

    The next ten years are going to be the most turbulent in global business ever. They will make all past eras seem tame by comparison. The energy crisis, the pursuit of sustainability, the continued major shift in global economic power to China and India, increasing environmental problems such as prolonged droughts, a continuing global food shortage, a potential revolution in agriculture (or maybe not), and a host of other issues defy doing business as usual. But many firms will try. My advice for making strategies successful in the future is to focus on innovation product/service, process, and business model innovation; to embrace new paradigms or better yet innovate them; align the 8 Ss; and to treat sustainability and energy sources and uses as competitiveness issues and not unpleasant tasks that have to be done.

  • In all the BSchools, the students are offered a course either on Corporate Strategy or Business Strategy. And invariably, these courses offer tools and techniques of strategymaking. But no B-School seems to be teaching execution as part of the strategy. All of them become very good in strategizing with no idea whatsoever on implementing. Even as regards to implementation, the students are taught the science in the classrooms. How about teaching them execution? What according to you should be done to sensitize them to the importance of becoming equally good executionists?
    For the major paper in my strategy/ business policy class, I require students to not only formulate a strategy for a company but also to address all of the 8 Ss for their proposed strategies; formulate a communication strategy for investors and a different one for employees; devise a cultural artifacts strategy focusing not just on rewards but other artifacts as well; and to write a letter of understanding covering the ground they hypothetically discussed with a specific direct report regarding executing the new strategy along the lines of what Larry Bossidy and Ram Charan suggest in their book Execution. I use an example of howcritical this follow up is from a close friend of mine who has successfully turned around three sizeable companies in the past 12 years.

1. Business Strategy Case Studies
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The Interview was conducted by Dr. Nagendra V Chowdary, Consulting Editor, Effective Executive and Dean, IBSCDC, Hyderabad.

This Interview was originally published in Effective Executive, IUP, September 2008.

Copyright © September 2008, IBSCDC No part of this publication may be copied, reproduced or distributed, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or medium electronic, mechanical, photocopying, recording, or otherwise without the permission of IBSCDC.

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