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Published: February 11, 2013

 
 

How Leaders Mistake Execution for Strategy (and Why That Damages Both)

All this is not to denigrate the role and power of having visions, missions, purposes, plans, and goals. Strategy is the primary tool a leader uses to guide decision making and resource allocation for a business and its people, but the corporate five give the leader a means to excite, focus, inspire, mobilize, and challenge. A vision paints a picture of the future around which your company can rally; a mission articulates an objective that defines what the company is seeking to achieve; a purpose describes why your company exists and gives meaning to what it does and the people who do its work; a plan lays out a set of actions to be undertaken within a certain time frame; and goals define how your success and progress will be measured and evaluated. None of these gives you a strategy, but they do play an important role: They motivate an organization to perform at its very best in the context of that strategy. That is what execution is all about.

Gerstner knew this too. After stabilizing the company and establishing IBM’s strategic five, he did, in fact, create a vision: “To lead big companies into the brave new networked world, IBM will devise their technology strategies, build and run their systems, and ultimately become the architect and repository for corporate computing, tying together not just companies but entire industries.” But, even then, he recognized the need to connect that vision to the strategy (and execution). “Vision is easy. It’s just so easy to point to the bleachers and say ‘I’m going to hit one over there,’” Gerstner told a CNN interviewer in 2004. “What’s hard is saying, ‘OK, but how do I do that? What are the specific programs, what are the commitments, what are the resources, what are the processes in play that we need to go implement the vision, to turn it into a working model that people follow every day in the enterprise?’ That’s hard work.”

If you want to have a bit of fun sometime, just ask your head of strategy or general manager how the corporate five differ from strategy. A typical response will be, “Who cares? Aren’t they all about giving direction to a business? Does it matter what you call ‘direction,’ as long as you have it?” Now, you have an answer. Without addressing the strategic five, your company will lack the foundation and the context for making the choices and allocating the resources that are critical to superior execution. Without the corporate five, your organization will lack the perspective, commitment, and alignment required to perform at its very best.

Author Profile:

  • Ken Favaro is a senior partner with Booz & Company based in New York and global head of the firm’s enterprise strategy practice.

 

 
 
 
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