To implement any strategy or plan effectively, the involvement of a business leader in the execution process is the key. If execution is not good, any good plan is likely to fail. In the last 14 years, I have seen leaders in the corporate world, who had so many plans to implement. But they were poor at the execution of those plans. They take initiatives, but with poor execution, fail on many. So what should one do to avoid this?
There are some essential behaviors that form the building block of execution. We are going to understand three such behavior here as-
- Know your people and your business.
- Insist on realism.
- Set clear goals and priorities.
Know Your People and Your Business
Leaders have to live their businesses. In companies that don’t execute, the leaders are usually out of touch with the day-to-day realities. They’re getting lots of information delivered to them, but it’s filtered—presented by direct reports with their own perceptions, limitations, and agendas. The leaders aren’t where the action is. They aren’t engaged with the business, so they don’t know their organizations comprehensively, and their people don’t really know them.
Suppose a leader goes to a plant or business headquarters and speaks to the people there. He is sociable and courteous. He shows superficial interest in his subordinates’ kids—how well they’re doing in school, how they like the community, and so on. Also, he may ask some shallow questions about the business, such as “What’s your level of revenue?” This leader is not engaged in his business.
When the visit is over, some of the managers may feel a sense of relief, because everything seemed to go so well and pleasantly. But the managers who are any good will be disappointed. They’ll ask themselves, What was the point? They had prepared for tough questions—good people like to be quizzed, because they know more about the business than the leader. They’ll feel frustrated and drained of energy. They didn’t get a chance to make a good impression on the leader—and the leader certainly didn’t make a good impression on them.
As a leader, you have to show up. You’ve got to conduct business reviews. You can’t be detached and removed and absent. When you go to an operation and you run a review of the business, the people may not like what you tell them, but they will say, “At least he cares enough about my business to come and review it with us today. He stayed there for four hours. He quizzed the hell out of us.”
Insist on Realism
Realism is the heart of execution, but many organizations are full of people who are trying to avoid reality. Why? It makes life uncomfortable. People don’t want to open Pandora’s box. They want to hide mistakes or buy time to figure out a solution rather than admit they don’t have an answer at the moment. They want to avoid confrontations. Nobody wants to be the messenger who gets shot or the troublemaker who challenges the authority of her superiors.
Sometimes the leaders are simply in denial. When we ask leaders to describe their organization’s strengths and weaknesses, they generally state the strengths fairly well, but they’re not so good on identifying the weaknesses.
Embracing realism means always taking a realistic view of your company and comparing it with other companies. You’re always keeping an eye on what’s happening in companies around the world, and you’re measuring your own progress, not internally, but externally. You don’t just ask, “Have I made progress from last year to this year?” You ask, “How am I doing vis-à-vis other companies? Have they made a lot more progress?” That’s the realistic way to look at your station.
Was it realistic for AT&T to acquire a bunch of cable businesses it didn’t know how to run? The record shows it wasn’t. Was it realistic for Richard Thoman to simultaneously launch two sweeping initiatives at Xerox without being able to install the critical leaders? Clearly not.
How do you make realism a priority? You start by being realistic yourself. Then you make sure realism is the goal of all dialogues in the organization.
Set Clear Goals and Priorities
Leaders who execute focus on a very few clear priorities that everyone can grasp. Why just a few? First, anybody who thinks through the logic of a business will see that focusing on three or four priorities will produce the best results from the resources at hand. Second, people in modern-day organizations need a small number of clear priorities to execute well. In an old-fashioned hierarchical company, this wasn’t so much of a problem—people generally knew what to do, because the orders came down through the chain of command.
A leader who says “I’ve got ten priorities” doesn’t know what he’s talking about—he doesn’t know himself what the most important things are. You’ve got to have these few, clearly realistic goals and priorities, which will influence the overall performance of the company.
Along with having clear goals, you should strive for simplicity in general. One thing you’ll notice about leaders who execute is that they speak simply and directly. They talk plainly and forthrightly about what’s on their minds. They know how to simplify things so that others can understand them, evaluate them, and act on them so that what they say becomes common sense.
Sometimes it takes a new pair of eyes to clarify priorities. In August 2000, the world’s largest retail chain in its category named a new CEO. The chain was losing ground to competitors. Caught up in the excitement of “revolutionary” ambitions, it had pursued e-commerce and other new non-store ventures and had lost its focus on executing the core business. Its stock price had fallen by two-thirds over the past year.
The senior management team urged the new CEO to grow the business by building more stores. But the CEO, who had risen through the company as a block-and-tackle execution-oriented person, felt the company was already chasing too many possibilities. He made improving the performance of existing stores his top priority and focused his people on raising gross margins and comparable sales (improving same-store sales from year to year).
He took three steps to translate these goals into actions. First, he sat down with his ten direct reports to explain the goals and discuss their implementation—how they could be met, what obstacles had to be overcome, and how the incentive system had to be changed. Then he gathered his roughly top 100 merchandising and store executives for a two-day session. He taught them about the anatomy of the business, explaining directly and simply such things as what had happened to sales growth and why; what factors, such as logistics flow, were affecting the cost structure; and how harmony between the merchandising people and the stores was missing and what the consequences were. He set clear targets for the next four quarters and discussed with them how to meet the targets. Before the executives left, each had a ninety-day action plan and a clear agreement on following through. Finally, he conducted a similar two-day session for several hundred merchandising and store managers.
“Vision without action is a daydream. Action with without vision is a nightmare.” – Japanese proverb