Don't just plan it – do it*

By David Kane and Josée Santoni

Execution is the missing link in too many strategic plans

*This article is an expanded version of a summary that first appeared in the August 2004 issue of CAmagazine.

Whether you are a sales manager or a CEO, planning is often a stimulating, thought-provoking experience. But how often have you poured your soul into extensive, groundbreaking strategic planning sessions only to see your plans fizzle before they ever got off the ground?

The lack of executional understanding and ability are at the root of some serious business issues we see in today's economic environment.

Planning is fun but execution is where the money is
Let's face it, planning is fun. There are no restrictions on blue-sky thinking and no consequences in discussing numerous "what-if" scenarios in a world where everything is possible. It is easy to say we can reduce costs by 10%. But when the amount of work required is more clearly understood, you can begin to see the true economic value of your newfound strategic initiatives.

When specific responsibilities are assigned, the planners often engage in a favourite diversion: they question the target, then back-pedal like crazy. As an executive, you must deal with these individuals firmly. Remember, the team members were all for the objectives before these people were given specific responsibilities.

Good planning does not make up for poor execution
In the past few years, many wonderful ideas have come to life without any consideration paid to their commercial feasibility or viability. We have seen numerous adventures (not to confuse with ventures) fueled in large part by the heady dreams of venture capitalists and institutional lenders. In some cases, they miraculously forgot that a solid business plan followed by rigorous execution is the best guarantee of success. We give these companies full credit for being able to sell their plans and create a huge amount of wealth, if only on paper. But some of these businesses were launched on weak foundations, and many people (including innocent bystanders) either lost money or saw their reputations seriously damaged.

To get a true sense of what an underplanned, poorly executed non-success looks like, visit the New Products Showcase and Learning Center in Ann Arbor, MI. The showcase is part of NewProductWorks (http://www.newproductworks.com/), a division of Arbor Strategy Group. The company bills the 70,000-item showcase as "an ever-growing collection of new and once-new consumer packaged products. It covers essentially every product category sold in a grocery store: food, beverage, household, health and beauty care, baby care, pet products and many others. "

We have been involved with some very forward-thinking organizations that are constantly probing the most unlikely areas in search of new opportunities and better understanding of their markets. But even if you are not a fringe strategic planner, it is worthwhile to take a look at some wonderful and not-so-wonderful ideas that achieved a certain degree of fame by not being able to gain or sustain customer acceptance and market share.

A bad rap?
We're all familiar with the line, "Genius is 10% inspiration and 90% perspiration." Since execution is the 90% part, it's easy to see why it suffers from bad PR.

Many books and articles have been written on planning and strategy (including many in CAmagazine), but execution always seems to get second billing, if it makes it to the marquee at all. 

In our instant gratification society, execution is not an attention-getter. But steady and methodical progress is the best guarantor of results. Jim Collins' book Good to Great identifies 11 great companies that have been able to deliver exceptional, sustainable results. He concludes that many of these exceptional organizations are not flashes in the pan. They owe their success to great (but not flashy) leadership, clear direction and disciplined execution, applied over the long term.

As a senior executive at a major venture capital group recently said, "The single most important element that is currently missing to ensure business success in most Canadian companies is the ability to execute."

Who is going to do it?
While it is painfully obvious that we should look at planning with a considerable amount of common sense, over-optimistic thinking and under-assessed situations are very common in current business practices. Often, as a result of group dynamics, a group is willing to take on much greater risk than any individual would be prepared to take.

None of us likes to rain on someone's parade or to put the brakes on some great plan, but sometimes it is the strategic thing to do. This is why it is important to have strong individuals, well grounded in the day-to-day operations of the organization, involved at the early stages of planning. Not only are they an excellent source of ideas and information, but they play a huge role in keeping things realistic and the meetings much more productive.

Even then, the most likely cause of overly optimistic planning remains a lack of detailed understanding and planning of the execution. These details often get treated summarily, as in, "We'll cross that bridge when we come to it."  This approach may have worked in the past, but it will always depend on the state of the bridge you plan on crossing and the size of the load you want to get to the other side.

From time to time, planners get a superiority complex – they feel disdain for the details of execution, not to mention the hard work. Other times, the executives get so tied up in day-to-day operations that they lose sight of the fundamentals and the realities of execution. This point was driven home recently on CBC TV's Venture program "Back to the Floor." It showed Bruce Bowser, CEO and president of AMJ Campbell Van Lines, spending time at the foundations of his business – doing sales calls, packing, moving, storing and re-installing customers in their new homes. The experience was an eye-opener for Bowser, who concludes, "These people have been with us for years. And these guys have put a lot of thought and input into what we're doing." Following his trip back to the floor, Bowser made a point to ensure that other senior managers have the same experience in an effort to improve their understanding of what is going on at the shop floor level, drawing on the knowledge that exists to determine what should be done and the best ways to execute.

Being realistically optimistic
The best way to produce actionable and results-oriented initiatives is to ensure the plans are firmly grounded in reality. This does not mean we should avoid risk or discourage big, bold objectives; it means we should make a reasonable assessment of the obstacles as well as the resources and commitment required to reach these targets.

Say a company is planning a 15% increase in unit sales. If we assume the sales will be coming from new customers, we should not only assume an increased workload for the sales force, but also for the credit department, shipping, production, accounts payable, receivable and so on.  If these subtle changes are not considered in the planning stage, you may be running some risk in spreading yourself too thin. 

Understand what you are up against
If you are looking at growth, which most of us are, you must establish where it is coming from. Very few people or organizations have extra money put aside waiting for someone to walk in the door with breakthrough technology, business processes or products that will have a strategic impact on the business. Any planned increases have to come from someone else's customer. You will have to convince people to give you money they have traditionally spent elsewhere, either within your industry or outside it. 

According to Statistics Canada, average household income and expenditures were both very close to $59,000 in 2001. More than 80% of household income was spent on the basics: taxes, food, shelter, clothing and transportation. Thus, it is spoken for before it is even spent.

Let's say you have a budget of $100 a week for groceries. While doing your shopping on Thursday evening, you see a new product trumpeting huge health benefits. Trying new products makes sense, but are you willing to face the wrath of your teenagers if you opt for the spinach-enriched, whole wheat, organic breakfast cereal instead of the sugar-coated glucose puffs? Not only do you have to justify the new product, but you also have to justify not buying the puffs to your 16 year-old son who eats them out of the mixing bowl. The same applies to any business situation. Even if you convince the VP production that you have the best widgets, will he be able to push your product to his staff, the purchasing group and the other stakeholders?

And how do you think the makers of the glucose puffs are going to react? How would you react to an incursion into your sandbox? Basically, you must anticipate the reaction of the stakeholders, customers and competitors and plan how to deal with it. Remember, there are few things more dangerous than a cornered animal, or one that thinks it is.

Stay focused, assign responsibility and reward progress
Lack of strategic vigilance is another way of saying poor control over execution. One of the best ways to ensure things get done is to assign specific responsibilities and to deal in fact rather than conjecture.  By maintaining a project list with the associated objectives and time frames, you or the team will monitor the executional progress and make modifications where necessary. These decisions must be made and supported by fact. If people make claims regarding executional performance, make sure they can support their argument with solid information.

Rigorous execution is a discipline: the more you practise it, the easier it becomes. But many organizations never even get that far. Until execution is given the attention it deserves, blue-sky planning will continue to mesmerize many board members and produce countless exhibits for the new products showcase in Ann Arbor.

David Kane, BCom, BA, and Josée Santoni, MBA, CA, are associates at SMCS Inc. (www.smcs-inc.com), a Montreal-based organization dedicated to business development and organizational effectiveness. They can be reached at info@smcs-inc.com.