Definition: Strategy Implementation
Strategy Implementation refers to the execution of the plans and strategies, so as to accomplish the long-term goals of the organization. It converts the opted strategy into the moves and actions of the organisation to achieve the objectives.
Simply put, strategy implementation is the technique through which the firm develops, utilises and integrates its structure, culture, resources, people and control system to follow the strategies to have the edge over other competitors in the market.
Strategy Implementation is the fourth stage of the Strategic Management process, the other three being:
- Determination of strategic mission, vision and objectives
- Environmental and organisational analysis
- Formulating the strategy
It is followed by Strategic Evaluation and Control.
Strategy implementation is the translation of chosen strategy into organizational action so as to achieve strategic goals and objectives. Strategy implementation is also defined as the manner in which an organization should develop, utilize, and amalgamate organizational structure, control systems, and culture to follow strategies that lead to competitive advantage and a better performance.
Organizational structure allocates special value developing tasks and roles to the employees and states how these tasks and roles can be correlated so as maximize efficiency, quality, and customer satisfaction—the pillars of competitive advantage. But, organizational structure is not sufficient in itself to motivate the employees.
An organizational control system is also required. This control system equips managers with motivational incentives for employees as well as feedback on employees and organizational performance. Organizational culture refers to the specialized collection of values, attitudes, norms and beliefs shared by organizational members and groups.
Process of Strategy Implementation
There are six steps in our process guide to strategy implementation that you can follow and ensure that your strategic plan evolves from just a plan into strategic implementation:
- Define your strategy framework
- Build your plan
- Define KPIs
- Establish your strategy rhythm
- Implement strategy reporting
- Link performance to strategy
Define Your Strategy Framework
On the one hand, strategy should be incorporated into everything you do. It should be ingrained in the organization's and its employees' DNA. On the other hand, if you do not make an effort to expressly point it out, you will not obtain the attention or traction that you require.
Begin with a simple framework that presents a strategic lexicon that everyone can understand and support. When someone asks, "How are our strategic objectives coming along?" everyone should be on the same page regarding what that means. Cascade employs the following ‘strategy house' to define the many components of our strategy.
More information on this approach can be found in our How to Write a Strategic Plan Guide, and if you like it, we have a free template you can use to put in your own strategy. The essence, though, is that it provides us with a clear mechanism to structure and discuss strategy implementation. It avoids employing excessive jargon.
In addition, rather than the more common 'vision/mission' combination, we have purposefully included solely a vision statement. We did this because people frequently fail to understand the distinction between the two. Confusion of any kind is the last thing we want when discussing strategy implementation, thus we choose to include only a vision statement.
Consider utilizing a strategy framework, such as the Balanced Scorecard or McKinsey's Strategic Horizons, to add depth to your plan. We have created a guide to assist you in determining which framework is best for you. However, whichever framework you use, keep things simple.
Create Your Strategy
The following phase in our strategy implementation process guide is where you will begin developing your plan. Now that you have established your framework(s), you will begin the actual creation of your strategic plan.
Steps to build your plan:
- Gather the organization's leaders (founders, CEO, directors, etc.) to agree on your vision. You could tackle this in a workshop.
- Begin writing down the values that the organisation holds at the same training.
- Finally (same workshop), jot down 3 or 4 emphasis areas that the team believes must be addressed to achieve the goal.
Then stop! Do not be tempted to create strategic objectives just yet.
Return your basic structure to your team(s) and begin to solicit independent opinion for strategic objectives under each of the emphasis areas. You may give one focus area to each member of your leadership team and have them lead the charge to flesh out that focus area.
After you have filled out the strategic objectives, reassemble as a group and ask yourself:
- If we deliver each of these strategic objectives under a given focus area, will we have nailed that focus
- If we deliver all focus areas, will we reach our vision?
- Will our values help or hinder us along the way?
Define KPIs
Step 3 of our plan implementation process guide asks you to specify your KPIs. They keep you honest about your development and focused on the goals you set.
Pointers for creating KPIs:
- Keep it simple – avoid complicated ratios that only a few comprehend.
- Choose at least one KPI for each strategic goal; more than one is OK, but the total should not exceed 6–7.
- Make sure KPIs can be measured quickly; avoid long-term-only measures.
- Do not make it all about the money; KPIs should be the catalysts for financial outcomes.
Establish Your Strategic Rhythm
Step 4 is where you develop your strategy rhythm.
- Decide how often to meet to discuss progress (monthly or quarterly).
- Determine participants (leadership team at minimum).
- Decide meeting length (minimum 1 hour).
- Set meeting structure and reports.
Implement Consistent & Simple Strategy Reports
Step 5 focuses on reporting. Reports should be:
- Consistent – everyone knows what to update.
- Simple – at-a-glance view of progress.
- Accountable – include owners and contributors.
- Insightful – overview of progress over time, with comparisons or charts.
Link Performance Reviews to Strategy
Integrate strategy with performance management:
- Link employee performance and rewards to strategic execution.
- Recognize individual contributions to strategy.
- Use a performance management system or traditional reviews to ensure alignment.
Factors That Support Strategy Implementation
People
- Ensure enough people to implement strategies.
- Verify they have skills, knowledge, and competencies.
- Provide training, workshops, and seminars if needed.
- Ensure commitment and dedication to organizational goals.
Resources
- Allocate financial and non-financial resources.
- Ensure sufficient time to monitor and implement strategy.
Structure
- Clear lines of authority and responsibility.
- Effective communication channels across the organization.
Systems
- Tools and systems should support strategy implementation.
- Enhance efficiency, monitoring, and evaluation.
Culture
- Promote responsibility, accountability, and motivation.
- Involve employees in strategy implementation to increase engagement.
Pre-requisites of Strategy Implementation
- Institutionalization of Strategy – defend and promote strategy internally.
- Proper organizational climate – cooperative and committed environment.
- Formulation of operating plans – actionable decisions and programs.
- Organizational structure – aligned with strategy.
- Periodic review of strategy – ensures relevance in a dynamic environment.
- Alignment of resources, structure, culture, process, and reward structure is essential.
Aspects of Strategy Implementation
- Create budgets supporting strategic activities.
- Provide skilled and experienced staff.
- Align policies and procedures with strategy.
- Employ leading practices for key business functions.
- Establish information and communication systems.
- Develop a favorable work climate and culture.
