The challenges facing the world are vast and apparently timeless. Poverty and famine have stalked the decades of our lives. Issues such as climate change and pollution have been discussed, dissected and sometimes dismissed over the years. It is time to move beyond mere talk. Could 2018 be the year we start to act?
Make no mistake: the scale of these challenges is daunting. But even more daunting and unfathomable is our inability to effectively deliver solutions to them. Making change happen, bringing smart strategies to fruition, is increasingly the issue. The real agenda for 2018 is for humankind, and our great and powerful organizations, to get much smarter about actually executing on the agreed strategies.
To get a sense of the scale of this challenge, Brightline Initiative’s 2017 research, conducted by the Economist Intelligence Unit of 500 senior executive leaders across the globe, found that only one in ten organizations successfully reach all of their strategic goals. On average, organizations fail to deliver 20 percent of their strategic projects.
Clearly, this is deeply worrying at an organizational level. Think more broadly and it is even more alarming. Between 2016 and 2040 (according to the G20 Global Infrastructure Outlook), the world requires $94 trillion of investment in infrastructure projects — in areas such as energy, telecoms, airports, ports, railroads, roads and water. With a 20 percent failure rate, we are poised to waste resources worth $18.8 trillion dollars. This is almost equivalent to the GDP of the United States for 2017!
Worse still, we know from conversations and interviews with executive leaders that the 20 percent failure rate is almost certainly underestimated and affects not only the private sector, but governments and not-for-profit organizations.
The stakes are so high that they bear constant repetition. Imagine you are CEO of a global enterprise with $1 billion worth of investment in a portfolio of strategic projects – or a shareholder of that company. Would you accept that $200 million (20 percent) is simply going to be wasted due to poor implementation? We doubt it.
The EIU report (conducted in partnership with the Brightline Initiative) brought to light some C-level perspectives about this issue. For example, Bob Collymore (CEO of East African telecoms company Safaricom) said, “If you don’t get implementation right, all you are doing is developing documents.”
The report concludes that: “Most senior executives recognize that strategy delivery is as important as design. Yet a surprisingly large minority do not appreciate the crucial role of delivery in ensuring a strategy delivers financial performance.”
We need to rethink how strategies are implemented and understand that they do not simply happen by chance or good fortune. Being able to successfully implement strategic projects and programs offers a hugely powerful competitive advantage for any type of organization. Executives and organizations need to deepen their understanding of the gap between strategy design and delivery in order to develop more effective solutions.
Understanding more about what we call the “strategy design and delivery gap”, and figuring out practical solutions to it, lies at the heart of the work of the Brightline Initiative, a coalition of leading global organizations. We cannot afford to waste this outrageous amount of resources.
We need to develop adequate guidelines and practices for supporting leaders in leveraging their organizational delivery capabilities to overcome many of the strategy-implementation challenges. But we know this is not an easy task.
However persuasive a strategy, however charismatic a company founder, and however laggardly the competition, execution is always challenging.
The 2017 EIU research report identified the leading challenges in strategy implementation as:
- Cultural attitudes
- Insufficient or poorly managed resources
- Insufficient agility
- External developments
- Strategy not understood / poorly communicated
- Poor coordination across the organization. (EIU 2017, 10)
This is just a small selection of the most common challenges. Their profusion means that the solution to close the strategy-implementation gap must be tailored to each organization and business context. To tackle the great issues facing us today and in the future we need to bridge this gap. Only then can we make progress.
Ricardo Viana Vargas is Executive Director of the Brightline Initiative.