IGrowth & StrategyGuide
Executing Strategy: Why Good Plans Fizzle Out in Daily Business
The strategy is set, the plan is good, and three months later everything runs as before. This is rarely due to a lack of will. A large study shows that execution fails in places other than most owners suspect. This guide shows where, and what a small business can do about it.
Key takeaways
- Execution rarely fails because of unclear goals. In a survey of nearly 8,000 managers, more than 80 percent said their goals were limited in number, specific, and measurable (Sull, Homkes, and Sull 2015).
- It fails because of three gaps: the strategy is not understood, coordination between units does not work, and there is not enough time and money for too many initiatives.
- If you respond to stalled execution only with more control, you fall into the alignment trap: more metrics, more meetings, fewer results.
- For small businesses, a simple rhythm helps: few initiatives, each with an owner and time in the calendar, a weekly meeting for status, and a quarterly review for adjustments.
Why good plans fizzle out in daily business
In January, the strategy is set. The owner spent an afternoon thinking, perhaps with the team, and defined three initiatives for the year: address a new customer group, speed up the proposal process, discontinue a service. By April, none of them has made significant progress. Orders got in the way, an employee was off sick, a customer had an urgent problem. Nobody gave up the initiatives; they simply fizzled out.
The pattern is so common that it seems almost normal. The question this article sets out to answer: why do good plans fizzle out in daily business, and what helps a small or mid-sized business against it? To answer it, we first clarify what execution actually is, then present the findings of a large study, weigh two perspectives on the plan, and finally arrive at a rhythm that holds up in daily work.
A strategy that nobody has time for in their calendar is a wish with a date.
What is execution? A term often understood too narrowly
Most owners understand execution to mean translating goals into tasks, assigning them to people, and checking them. In technical terms, this is called alignment: activities in the business are aligned with the strategy. That is correct but incomplete.
Donald Sull, Rebecca Homkes, and Charles Sull (2015) propose a broader definition. For them, execution is the ability to seize opportunities that fit the strategy while coordinating continuously with other parts of the company. This definition contains three things that go beyond alignment: understanding, because only those who know the strategy recognize fitting opportunities; coordination, meaning collaboration across unit boundaries; and agility, meaning the willingness to adjust the plan when the situation changes.
The mental model: the three gaps of execution
Over several years, Sull, Homkes, and Sull conducted more than 40 experiments in companies and surveyed nearly 8,000 managers from more than 250 companies. Their most important finding: several widely held beliefs about execution are wrong. Alignment worked well in most companies. More than 80 percent of respondents said their goals were limited in number, specific, measurable, and funded. The problems lay elsewhere.
Source: Sull, Homkes, and Sull (2015)
A mental model with three gaps can be derived from these findings. The understanding gap: the strategy is communicated often and at length, but not understood. Nearly 90 percent of middle managers felt top management communicated often enough, yet almost half could not name any of the five priorities. The coordination gap: 84 percent could rely on their own boss and team, but hardly on other units. The resource gap: more initiatives are running than time and money can support, and old initiatives are ended too rarely.
| Gap | How you recognize it | Remedy |
|---|---|---|
| Understanding gap | Employees cannot name the two or three initiatives of the year in their own words | At most three initiatives, each described in one sentence, regularly asked about rather than merely announced |
| Coordination gap | Sales, delivery, and administration pass delays back and forth | Commitments between units are recorded and checked in the weekly meeting |
| Resource gap | Every initiative waits for things to quiet down | Fixed hours in the calendar for every initiative; for every new initiative, end an old one |
Worked example
The alignment trap: when more control does harm
When execution stalls, many managers respond with more control: more metrics, more frequent reports, additional meetings. Sull, Homkes, and Sull call this the alignment trap. The additional control often turns into micromanagement; it stifles the experimentation that agility requires and the direct coordination among colleagues. Execution suffers further, and management tightens the screws even more.
Alignment trap
- More metrics when an initiative stalls
- Owner decides every conflict personally
- New initiatives are added, old ones remain
- The strategy is repeated at every meeting
Better way
- Clarify the cause of the delay, usually a missing commitment
- Conflicts between units are resolved there; the owner sets the framework
- For every new initiative, an old one is ended
- Employees explain the strategy in their own words
In a small business, the trap takes a special form. The owner is often the only person with an overview of all areas. If they resolve every conflict themselves, that works for a while. But the study describes precisely this path as a risk: concentrating decisions at the top weakens, over time, the ability of others to coordinate among themselves. Who may decide what without asking is described in the guide defining decision paths. Where information gets lost between units is shown in the analysis interfaces between departments.
Two perspectives: stick to the plan or adjust it?
The first perspective says: a plan only works if you stick to it. If you deviate at every difficulty, you lose the line, and in the end the strategy was a paper without consequences. Goal-setting research supports this. Locke and Latham (2006) summarize that specific, challenging goals produce better performance than vague ones when people feel committed to them, as the guide OKR for small and mid-sized companies describes.
The second perspective says: no plan survives contact with reality. Henry Mintzberg and James Waters (1985) showed that realized strategies rarely consist only of the planned part. A large part emerges along the way, from opportunities and experience. Sull and colleagues support this: nearly a third of respondents named the difficulty of adapting to changing markets as the greatest challenge of the coming years. Most companies reacted either too slowly, or quickly but without reference to the strategy.
I consider both perspectives compatible if direction and path are separated. The direction, meaning the two or three initiatives of the year, stays fixed until the annual strategy check deliberately changes it. The path there may change every quarter. Those who confuse the two either cling to an outdated action plan or abandon the direction at the first difficulty. The study also warns against the opposite of sticking to the plan: half of middle managers believed they could secure resources even for opportunities outside the strategy. Agility without boundaries leads to more initiatives than the business can carry.
An execution rhythm for small businesses
The three gaps lead to a simple rhythm with three cycles: year, quarter, week. It needs no software and no consultants, but discipline in the calendar.
Year: set at most three initiatives
The annual strategy check ends with at most three decisions, one thing the business stops doing, and a date for review. Each initiative is described in one sentence that anyone in the business can repeat.
Year: assign responsibility and time
Each initiative gets a responsible person and fixed hours per week in the calendar. An initiative without time in the calendar is not executed, however important it is.
Week: five minutes for status
In the weekly team meeting, ask briefly for each initiative: what happened, what is the next step, which commitment from whom is missing? How such a meeting is structured is shown in the guide weekly planning in the team.
Quarter: adjust the path
Once a quarter, check whether the path is still right. The direction stays; the measures may change. Initiatives that are not progressing are deliberately ended or reshaped.
Ongoing: check understanding
Occasionally ask employees to explain the initiatives in their own words. Those who cannot have not understood them, no matter how often they were announced.
Worked example with freely chosen values. Fixed appointments do not prevent every displacement by daily business, but they reduce it considerably.
If you want to measure whether the initiatives are progressing, you need only a few figures. A one-page KPI dashboard, as described in the guide a one-page KPI dashboard, is enough. More important than any figure is that it is actually looked at in the weekly meeting.
How you can tell that execution is working
- Everyone in the business can name the year's initiatives in their own words.
- At most three strategic initiatives are running at the same time.
- Each initiative has a responsible person and fixed hours in the calendar.
- Commitments between units are recorded and checked in the weekly meeting.
- For every new initiative, an old one has been ended or postponed.
- Once a quarter, the path is deliberately adjusted; the direction only in the strategy check.
The study by Sull and colleagues has limits. It concerns mainly large, complex companies with many units and management levels. In a business with ten or thirty employees, paths are shorter, coordination is easier, and the owner knows everyone. The three gaps still occur, only smaller: there too, employees often understand the strategy differently from the owner; there too, sales and delivery pass delays back and forth; and there too, more initiatives are running than there is time for. How to define the sales strategy itself is described in the guide developing a sales strategy.
Conclusion: why plans fizzle out and what helps
To answer the guiding question: good plans rarely fizzle out in daily business because the goals are unclear. They fizzle out because the strategy is not understood, because coordination between units does not work, and because more initiatives are running than time and money can support. The findings of Sull, Homkes, and Sull (2015) show that companies look there less often, because they equate execution with alignment.
What helps is not an additional control instrument but a simple rhythm: few initiatives, each with an owner and time in the calendar, a short weekly meeting for status and commitments, a quarterly review for adjusting the path. And one rule that is the hardest of all: for every new initiative, an old one ends.
Frequently asked questions
Why does strategy execution fail so often?
A study of nearly 8,000 managers shows that it rarely comes down to unclear goals. More often, the strategy is not understood, coordination between units does not work, and more initiatives are running than time and money can support. In addition, old initiatives are ended too rarely.
What is the alignment trap?
The term comes from Sull, Homkes, and Sull (2015). It describes how managers respond to stalled execution with more control, such as more metrics and meetings. This often leads to micromanagement, stifles experimentation and coordination among colleagues, and makes execution worse.
How does a small business execute its strategy?
With at most three initiatives per year, each with a responsible person and fixed hours in the calendar. Status is briefly checked in the weekly team meeting, and the path is adjusted once a quarter. For every new initiative, an old one is ended.
Should you stick to a strategic plan or adjust it?
Both, but at different levels. The direction, meaning the year's few initiatives, stays fixed until it is deliberately changed in the annual strategy check. The measures to get there may be adjusted every quarter.
How often should you review the status of your strategy?
A brief look every week in the team meeting, a few minutes per initiative, and a more thorough review once a quarter have proven effective. Once a year, the strategy check examines whether the direction is still right.
Sources
- Sull, D.; Homkes, R.; Sull, C. (2015): Why Strategy Execution Unravels and What to Do About It. Harvard Business Review, 93(3), 57-66.
- Mintzberg, H.; Waters, J. A. (1985): Of Strategies, Deliberate and Emergent. Strategic Management Journal, 6(3), 257-272.
- Locke, E. A.; Latham, G. P. (2006): New Directions in Goal-Setting Theory. Current Directions in Psychological Science, 15(5), 265-268.
