Roughly 40% of executive leaders say their enterprise accountability and leadership are not aligned on strategy execution, according to the 2020 Gartner Execution Gap Survey. Why does this misalignment occur? After all, the objective sounds simple enough: Define the organization’s strategy and make resource-allocation decisions to pursue it.
Executives should take these steps to ensure their functional strategic planning process is productive and tied to business goals.
The problem paradoxically is that many organizations lack a coherent plan for their strategic planning that properly translates lofty enterprise goals into functional initiatives and objectives.
The strategic planning process, especially during volatile times, should eliminate everything that isn’t necessary and sufficient to communicate an effective strategy. But the focus for functional leaders is still to identify initiatives that will drive enterprise growth ambitions and determine how to unlock the capacity (time, budget, talent and technology) needed to execute those initiatives.
- Verify the business context
Be clear what impact business priorities and challenges will have on your function’s imperatives, opportunities and risks, and therefore what you need to emphasize, deemphasize or stop doing.
- Assess capabilities
Evaluate the maturity and importance of key functional capabilities required to support the overall business goals. There shouldn’t be a big difference between the function’s self-assessment and business partners’ perceptions of its strengths and weaknesses. Generate a prioritized list of functional capabilities to bolster or gaps to fill to support business goals.
- Set objectives
Develop a prioritized list of objectives with discrete and measurable steps that describe how a specific goal will be accomplished. Each strategic business goal can be supported by a few objectives with a time horizon of one to two years.
Objectives should be specific, measurable, actionable, relevant and tied to a near-term deadline to ensure timely completion. Develop an action plan that stipulates how the objectives will be met, including specific measures to track progress, and metrics that are robust but simple enough to quantify that progress effectively.
- Look to fund innovation and growth
Be sure to deprioritize funding for less strategically relevant initiatives, and look to better leverage underutilized resources. And, make sure you have a clear understanding of the relative cost, risk, time and benefits of potential cost optimization initiatives.
- Put your strategy on a page
Capture the elements of your strategic plan on a single page. Gartner suggests creating a template outlining where the functional organization is, where it is going and how it will get there.
Communicate how you are adding value today and demonstrate how you plan to impact future business across the coming year. Include a statement of strategy, a before-and-after description of the state of the function, one or two critical assumptions underpinning the strategy, and five to seven initiatives required to meet the functional objectives established to support business goals.
- Drive the plan home
Do this by articulating the objectives and strategy across the function and company.
You need a clear and consistent message that drives buy-in and commitment from your functional leadership team, engagement and motivation among the workforce to implement the plan, and understanding across the enterprise of how your priorities are changing, and why.
- Prepare to respond to change
Once the strategic plan is adopted and shared, it’s critical to measure progress against the objectives, revisit and monitor the plan to ensure it remains valid, and adapt the strategy as business conditions change
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