STRONG OPERATIONS: A KEY INGREDIENT TO BRINGING YOUR BUSINESS STRATEGY TO LIFE
Written by Jessica Murray
What happens when you have a great strategy but can’t act and make the outcomes a reality? You lose.
That may sound blunt, but it’s true. Even with the best strategy, if you can’t execute, you won’t fulfill your potential.
Let’s use an example from the past to illustrate this point.
Toys “R” Us had a strategy that worked well for a while. However, at a certain point, they stopped being laser-focused on the customer and the strategic direction that would allow them to continue delivering a differentiated value proposition.
There are plenty of cautionary tales from the past, but the big takeaway is this: If you’re investing time to formulate a winning strategy, you should also think critically (i.e., invest the appropriate amount of time and resources) about how to execute effectively and remain flexible enough to evolve when the market shifts.
Often, a strategy-execution gap exists among teams, which can further these struggles.
This occurs when:
Strategy isn’t clearly and continuously communicated to everyone on the team.
Leaders forget it’s not just about communicating a message, but rather that a strategy must be distilled into language that everyone can understand.
Resource availability and allocation weren’t carefully considered when establishing a strategy, so your team isn’t equipped to succeed.
You lack flexibility, limiting your ability to adapt if market factors change mid-course.
Strong accountability structures don’t exist across the team.
What can help your ability to implement a strong strategy? Ding, ding, ding! Strong operational design.
Operations can be a broad category, and sometimes it’s hard to fit it into a well-defined “box.” However, simply put, operations ensure the daily activities of your business align with long-term objectives.
Strategy and operations are interconnected and you need strength in both to succeed. There’s a complete feedback loop: Operations takes direction from strategy, and strategy is refined and improved based on operational performance. I’ll explain how below.
How strategy informs operations
Resource allocation: Strategy clarifies what resources should be leveraged to achieve objectives. Operations takes those inputs and makes the appropriate allocation decisions to align execution to the strategy.
System and process focus: Strategy informs which systems and processes should be refined by operations first, again based on the outlined long-term objectives.
Metrics: Strategy should define what success looks like, enabling operations to establish the right metrics for measuring performance.
Operations also serve to refine strategy
Real-time feedback: Insights and data collected on performance metrics provide real-time, continuous input to the strategy’s effectiveness. This allows leadership to make more dynamic adjustments and not hold fast to a strategy that isn’t working.
Capability assessment: Operations should be able to surface internal capabilities and limitations, which is necessary feedback to stress test whether a business’s strategy is achievable.
Surfacing innovation: Observations from front-line operations often uncover new opportunities to innovate, which can inform strategic direction.
While strong operations can make a business with a great strategy shine, it can’t put lipstick on a bad strategy. If you’re targeting the wrong market, don’t have a strong grasp of customer needs or lack a differentiated market positioning, no amount of optimization can make you successful. Therefore, spend adequate time developing a sound strategy and then focus on operational excellence to make it a reality.