The majority of senior executives participating in a global survey said they didn't believe their company possessed a "winning strategy," and two-thirds said they felt their organizations lacked the necessary capabilities for executing strategy, according to Harvard Business Review.
Shocked by these findings, Paul Leinwand, partner at Booz & Company's global consumer, media and retail practice, and Cesare Mainardi, CEO of Booz & Company's Knowledge and Marketing Advisory Firm, along with Art Kleiner, editor-in-chief of Strategy+Business, set out to learn how some companies are able to marry strategy with execution.
They discovered companies like Amazon and Apple — those that have closed the gap between strategy and execution — don't follow the traditional practices of their industries. Instead, those companies' leaders demonstrate five unusual management practices that challenge conventional knowledge, according to HBR.
1. Commit to an identity. Exceptional companies are not scatterbrained — they do not create strategies for chasing numerous market opportunities at the same time. Instead, they zero in on what they do best, develop a strong value proposition and invest in building capabilities that can be continually refined and distinguish them from competitors.
2. Translate the strategic into everyday actions. Many managers believe the path to success is adopting the best practices of their industry and using external benchmarks to measure progress. However, organizations that are most poised to effectively execute their strategy "design and build their own bespoke capabilities that set them apart from other companies," the report read. "Then they bring those capabilities to scale in their own distinctive ways."
3. Tap the power of culture. Many organizations turn to restructuring the organizational chart or designing new incentives when it comes to solving execution problems, according to the report. But the most successful companies avoid disruptive reorganizations and instead seek to extract the power that already exists in their workforce's thinking and behavior.
4. Cut costs to enhance areas of strength. A conventional approach to cutting costs might be to go lean all across the board. However, the companies the authors studied took a different approach. "They marshal their resources strategically, doubling down on the few capabilities that matter most and pruning back everything else," the report read.
5. They dictate their own future. The companies best prepared to execute on their strategy don't simply bend to the forces of the market around them. They create the change they want to see in their industry. They encourage and prioritize innovation, keep a watchful eye on emerging trends — even in other industries — and engage the consumer.