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What Is Strategy Execution, and Why Strategies Fail
Strategy execution is the work of turning a chosen strategy into decisions, funded work and results, week after week. This guide shows where it breaks, how to place your own organization, and what to change first.
Authors: Shannon Phillips & Tristan Ham
This guide is written for leaders of organizations with 20 to 500 people, where the people who set the strategy are often the people who carry it out. Our view at Unbounded Thinking: a strategy has been executed only when it changes what people work on this week.
On this page
01
What Is Strategy Execution
The Definition of Strategy Execution
A strategy says where an organization will compete and what it will stop doing. Execution is everything that has to happen for that to be true a year later.
Strategy execution is the repeated work of turning a strategy into choices about people, time and money, and of changing those choices as results come in.
It Repeats
Execution is not a phase that begins when the plan is approved. The same few decisions return every month: what gets people’s time, what gets money, and what stops.
It Includes Changing the Plan
Results arrive that the plan did not expect. Adjusting the plan on evidence is part of execution, not a failure of it.
Execution and Implementation Are the Same Work
Textbooks call the step after strategy formulation “strategy implementation”. Leaders more often say “strategy execution” and mean the ongoing work. This guide uses execution for both.
02
Planning and Execution
Strategy Execution vs Strategic Planning
The same people often plan and execute, so the line between the two blurs. They answer different questions and fail in different ways.
Strategic planning
Strategy execution
What it decides
Where to compete, and what to stop doing
What people work on this month, and what changed because of it
How often
Once a year, or once every three years
Every week and every month
Who does it
The leadership team, often with the board
Everyone who holds a budget, a team or a project
What it produces
A plan, priorities and targets
Decisions on time and money, finished work, results
What its absence looks like
Every project looks equally important
A good plan in a slide deck, and the same work as last year
A plan also assumes one future. A three-year plan written in a calm year can be out of date within months, and execution is where an organization notices and adjusts. Strategic foresight helps it see the change coming.
03
Why Strategies Fail
Why Strategies Fail: They Stall in the Middle
Most strategies do not fail in the plan. They stall in the middle, between the people who chose them and the people who do the work. Across 124 organizations studied for MIT Sloan Management Review:
“Only 28% of executives and middle managers responsible for executing strategy could list three of their company’s strategic priorities.”
The Priorities Are Not Known
People cannot act on a priority they cannot name. Ten priorities have the same effect as none.
No Time Is Freed
New work lands on top of the day job, competes with every urgent request, and loses.
Nothing Stops
Projects that no longer fit keep their people and their budget. Innovation portfolio management is how an organization decides what to stop.
04
The Execution Gap
The Strategy Execution Gap: Six Places a Strategy Stalls
When a strategy does not reach the bottom line, the cause is usually what Unbounded Thinking calls the Execution Gap: the organization cannot carry its ideas through to results. In a strategy, the gap opens in six places.
Priorities
Too many at once, or written so broadly that any project can claim to serve one.
Agreement at the Top
The leadership team agrees in the room, and each member leaves with a different version.
Capacity
No one counts the hours the strategy needs, so it is staffed with whatever time is left over.
Ownership
Each priority has a sponsor, but no one owns its next result and its date.
Rhythm
Progress is reviewed at the annual planning session, too late to change anything.
Visibility
Leaders see reports of activity, not of what changed, so they cannot tell what is working.
For innovation work, What Is Innovation Readiness describes the same gap through its five symptoms, from the Zombie Pipeline to the Black Box.
05
How to Execute a Strategy
How to Execute a Strategy: Four Decisions That Repeat
Strategy execution frameworks use different words. The strategy execution process underneath comes down to four decisions, made again and again.
1
Choose a Few Priorities
Three to five, each written so a manager can tell whether a project serves it. Publish the order, not only the list.
2
Free the Capacity
Count the hours each priority needs, and decide what stops to make room. Capacity comes before scoring.
3
Name an Owner and a First Result
One person owns each priority, with its next visible result and a date within ninety days.
4
Review and Decide
On a fixed rhythm, monthly for most organizations, look at what changed and give each initiative one of three answers: do it, test it more, or shelve it.
The fourth decision feeds the first: the review is where priorities change.
06
Common Frameworks
Strategy Execution Frameworks: Balanced Scorecard, OKRs and Hoshin Kanri
Three strategy execution frameworks come up most often. Each helps an organization set and track goals. Each still depends on the four decisions above.
Framework
Where it comes from
What it adds
What to watch with 20 to 500 people
Balanced Scorecard
Robert S. Kaplan and David P. Norton, first in Harvard Business Review in 1992
Measures beyond the financial: customers, internal business processes, and learning and growth
Many measures to keep current. Choose a few, or the scorecard becomes a reporting task.
OKRs (objectives and key results)
Created by Andy Grove at Intel; John Doerr took them to Google in 1999
An objective with a few measurable key results
Easy to write too many. Without freed capacity, OKRs restate the strategy without moving it.
Hoshin Kanri (policy deployment)
Lean management; the Lean Enterprise Institute calls it “a strategic framework for building sustained high performance”
A few objectives, pursued and reviewed with plan-do-check-act thinking
The full method is heavy for a small team. Its review habit travels well.
None of the three decides what stops to make room. That decision stays with the leadership team.
07
New Initiatives
Strategy Execution and Innovation
Most strategies call for something new: a product, a service, a market or a way of working. New initiatives are where execution breaks first, because they compete with the core business for the same people.
New initiatives are added on top of the day job.
A pilot is funded without agreeing what a good result leads to.
Every project stays alive until someone notices.
Progress is reported as activity: meetings held, ideas collected.
The strategy lives in a slide deck.
Free the Hours First
Name the work that stops before the new work starts.
Agree the Next Step in Advance
Before a pilot starts, agree what a good result will unlock: a budget, a team, a launch date.
Stop on Evidence
Agree the criteria for stopping before a project starts, so stopping is a decision about evidence, not about the people who championed it.
Report What Changed
A customer served, a cost removed, a decision made.
Keep the Priorities in View
Anyone in the organization can name the top three.
A pilot measures technical success; scale depends on human adoption. Unbounded Thinking calls the distance between the two the Innovation Gap. Why Good Ideas Are Not Implemented names six more places where approved work stalls.
08
Smaller Organizations
Strategy Execution in a Small or Mid-Size Organization
Most writing on strategy execution assumes a strategy office, a planning department and a software budget. An organization of 20 to 500 people has none of these. It has advantages a large one lacks.
The Leadership Team Is the Delivery Team
The people who set the strategy also run operations. Protect a fixed block of their time for strategic work, or the day job takes all of it.
Capacity Is the Real Limit
A team of five cannot carry eight priorities. Two or three finished beat seven started.
The Rhythm Can Be Light
One hour a month, with a single page per priority: the owner, the next result, the date and the decision.
Everyone Can Know the Strategy
At this size, every manager can name the priorities. Test it on Monday: ask five managers to write down the top three, without notes.
Decisions Are Close
Fewer layers mean a stop or a change can happen in one meeting. That speed is an advantage; use it.
09
Where You Stand
Strategy Execution Maturity: Four Stages to Place Your Organization
Unbounded Thinking describes innovation readiness in four stages: Random, Reactive, Structured and Organizational. The same four stages describe how an organization executes its strategy.
1
Stage
Random
How execution works
The strategy lives in the plan. Work is chosen by whoever asks loudest.
What a leader sees
No one can name the priorities.
2
Stage
Reactive
How execution works
Priorities change with each crisis. Projects start quickly and rarely finish.
What a leader sees
Last quarter’s priorities replaced before they produced a result.
3
Stage
Structured
How execution works
Priorities, owners and a review rhythm are in place, though decision-making remains largely top-down and silos still slow execution.
What a leader sees
Good reports, slow decisions.
4
Stage
Organizational
How execution works
Execution from concept to implementation happens as routine. Capacity is counted, reviews end in decisions, and stopping a project is normal.
What a leader sees
Priorities change on evidence, and people can say why.
An organization can sit at different stages for different priorities. The free Snapshot gives a first reading of your stage for innovation in about five minutes.
10
Measures
How to Measure Strategy Execution
Financial results arrive late. Four measures show sooner whether a strategy is being executed.
For measures of innovation itself, see innovation KPIs.
01
Priorities Named
The share of managers who can list the top three priorities without notes. It is close to the test the MIT Sloan study used.
02
Hours on the Strategy
The share of working hours spent on the priorities, counted rather than estimated.
03
Time to a First Result
The days from a decision to its first visible result.
04
Decisions Made
The number of initiatives changed or stopped on purpose each quarter. Zero usually means no one is deciding.
11
Next Steps
Close the Gap in Your Organization
Four ways to start, from five minutes to a full plan.
Free Innovation Readiness Snapshot
Five minutes, free: a first reading of your organization’s stage.
Innovation Readiness Assessment
The full assessment, taken by your leadership team, shows where execution breaks and what to fix first.
Strategic Blueprint
A strategy built to be carried out: an action plan in which each step has a priority and a timeframe.
12
Questions About Strategy Execution
What is strategy execution?
Strategy execution is the repeated work of turning a strategy into choices about people, time and money, and of changing those choices as results come in. It means choosing a few priorities, freeing the capacity for them, giving each an owner and a first result, and reviewing on a fixed rhythm so that work continues, changes or stops.
What is the difference between strategy execution and strategy implementation?
Very little. Textbooks call the step after strategy formulation “strategy implementation”. Leaders more often say “strategy execution” and use it for the ongoing work of carrying a strategy out and adjusting it. Some writers keep “implementation” for the one-time rollout of a plan. This guide treats the two as the same work.
What is the difference between strategic planning and strategy execution?
Strategic planning decides where the organization will compete and what it will stop doing, usually once a year or less often. Strategy execution turns those choices into decisions about people, time and money every week and every month. A good plan with weak execution looks like last year’s work under new headings.
Why do strategies fail?
Most strategies do not fail in the plan. They stall in the middle: the priorities are not known below the leadership team, no time is freed for them, and nothing stops to make room. A 2018 study of 124 organizations in MIT Sloan Management Review found that only 28% of executives and middle managers responsible for executing strategy could list three of their company’s strategic priorities.
What is the strategy execution gap?
It is the distance between the results a strategy promises and the results the organization delivers. Unbounded Thinking calls it the Execution Gap: the organization cannot carry its ideas through to results. In a strategy, it opens in six places: priorities, agreement at the top, capacity, ownership, rhythm and visibility.
What is a strategy execution framework?
A framework is a set of steps and tools for carrying a strategy out. The best known are the Balanced Scorecard, OKRs (objectives and key results) and Hoshin Kanri. Each helps an organization set and track goals. None decides what stops to make room; that decision stays with the leadership team.
How do you measure strategy execution?
Financial results arrive late, so add four early measures: the share of managers who can name the top three priorities, the share of working hours spent on them, the time from a decision to its first visible result, and the number of initiatives changed or stopped on purpose each quarter.
Who is responsible for strategy execution?
The leadership team owns it and middle managers carry it. In the MIT Sloan research, two survey items stood out as reliable predictors of alignment: top leaders communicate the strategy clearly and consistently, and a manager’s own boss explains why the priorities matter for the company and for the team. Each priority also needs one named owner for its next result.
How does strategy execution work in a small business?
The same four decisions apply with less machinery. Keep two or three priorities, protect a fixed block of the leadership team’s time, review for one hour a month with one page per priority, and use the short distance between people to stop or change work in a single meeting.
About the author
Shannon Phillips
Co-Founder and Innovation Strategist
Designs structured innovation systems for enterprise organizations and helps leadership teams set priorities that reflect how the organization operates.
About the author
Tristan Ham
Co-Founder and Lead Facilitator
Leads the delivery of innovation programs for enterprise and public sector teams and helps groups align on priorities and reach decisions.
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Next Step
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Take the free Snapshot for a first reading of your organization’s stage in about five minutes, or talk to us about a plan your team can carry out.
