Strategy Execution and Complexity

Thriving in the Era of Disruption

Richard Busulwa, Matthew Tice, Bruce Gurd

• Publisher: Routledge
• Year: 2018
• eBook ISBN: 9781351232173
• Topic: Business
• Subtopic: Business General
• Index: Business

Almost all organisations today face unprecedented levels of change, complexity and volatility. Navigating the resultant disruption dynamics is one of the most important stewardship challenges facing strategic leaders. Getting it right can pay enormous dividends, but getting it wrong can lead to spectacular failure and the ultimate demise of once admired organisations. To address this threat, strategic leaders need to better understand how to navigate complexity and volatility and how to execute strategy in this rapidly changing environment.

This book identifies 12 different strategy execution processes used to realise deliberate and emergent strategies – each illustrated with case studies and essential lessons for strategic leaders. The authors then discuss the effectiveness of these processes in different types of complex environments, showing how, used in isolation, each process can, at times, impede performance, sometimes creating survival risks that materialise today or in the future. The authors show the importance of "ambidexterity" and the need for organisations to balance the pursuit of internal efficiency and external market flexibility, both of which are essential to thriving in complex environments. This book provides essential tools for leaders to rethink and reconfigure their strategy execution practices in light of the significant change surrounding their organisations. The book is based on a 5-year, multistage study comprehensively reviewing cutting-edge research on strategy execution, reviewing seminal texts on strategy execution and, through in-depth case study interviews and cross-sectional surveys, identifying contemporary strategy execution practices of a range of different organisations across industries and sectors.

Part I
Types of complexity and their effects on strategy

1 Introduction and need for this book

Introduction

Our understanding of strategy execution has evolved over the last 30 years from identifying the factors for successful strategy execution to integrating these factors into cause and effect frameworks to guide strategy execution.^1,2,3 These frameworks have further evolved in recent years to become a clear set of principles and processes for executing strategy.^4,5,6,7 A number of different strategy execution processes have emerged within academic research and within practitioner books.⁸ Similarly, we have made significant advances in our understanding of complexity, to the point of identifying specific types of complexity and their effects on different strategy processes.⁹ In spite of these evolutions, between 60 percent and 90 percent of strategy execution efforts still fail to deliver.^10,11 We believe this is in large part due to unresolved ambiguity about the different types of strategy execution processes and their effectiveness in different contexts. Strategic leaders remain with unanswered questions such as: What are the different strategy execution processes? Do they work in practice? How are they affected by complexity? Do particular processes work better as complexity increases? Which processes will work best in my particular situation? In addition to these unanswered questions, many strategic leaders intrinsically know of processes and activities they have successfully used in practice but that aren’t mentioned in mainstream research or in practitioner books. Should they abandon these as ineffective or could they actually be more effective?

Need for this book

One of the greatest challenges facing organisations today is how to improve their ability to execute strategy in the face of increasing complexity and volatility.^12,13 This complexity and volatility manifests itself as more and more unexpected events and disruptions.¹⁴ Such unexpected events and disruptions increasingly derail strategy execution efforts – subtly at times, through initiatives that overpromise and under-deliver, and spectacularly at other times, through public failures or the demise of admired organisations.¹⁵ Thus, there is a great and timely need to address these issues so we can move onto considering not just how organisations can adapt and survive as complexity and volatility change, but how they can thrive in complex environments.¹⁶

Our research has led us to believe that these issues can be addressed in five ways. First, a comprehensive review of all the strategy execution processes proposed in academic research, in practitioner books and used in practice needs to be undertaken. By doing this, we can be sure that the majority of strategy execution processes have been identified, and the key steps and activities within these processes have been unpacked and their effective use demonstrated through real-world case studies. Second, the extent to which these processes are actually used across different environments, sectors, organisation sizes and different parts of organisation value chains needs to be investigated. Third, the different types of complex environments need to be identified and the extent to which organisations actually face these types of complex environments understood. This way, we can be clear about what is theoretical complexity and what is complexity actually faced in the real world. Fourth, the effect of each type of complex environment on the different types of strategy execution processes needs to be investigated, as well as the effectiveness of each strategy process in the different types of complex environments. This way, we can know which processes work best in each type of complex environment. Finally, clarification is needed regarding the role of strategic leaders in each of the different strategy execution processes and in each type of complex environment. This way, strategic leaders can understand the roles and activities they need to perform in each strategy execution process in order to thrive in complex environments. Addressing the aforementioned issues through the five approaches, then, is the aim of this book.

Research for this book

The research for this book was undertaken in four stages. In stage one, a comprehensive review of all the academic literature on strategy execution over the last 30 years was undertaken to identify the different strategy execution processes discussed over this period. These processes were unpacked and, where necessary, synthesised into their respective steps and activities. The same process was repeated to identify the different types of complexity and to unpack their drivers.

In stage two, a comprehensive review of the leading practitioner books was undertaken to identify the different strategy execution processes and the different types of complexity discussed over this period. In order to identify the seminal books, a search for the terms “strategy”, “execution”, “strategy execution”, “strategy implementation”, “complexity” and “volatility” was undertaken on three leading online book retailing platforms (i.e. Amazon, Google Books, Apple Books). A search of the broader terminologies applying to strategy execution and complexity was also undertaken (e.g. adaptive strategy, agility, corporate longevity, strategic renewal etc.). Once a list of books was assembled, the synopsis and reader feedback of the different books was reviewed, and these were ranked for relevance and popularity. Then a search engine search for the top books for each search term was undertaken and used to modify the book rankings where there were inconsistencies. This resulted in identification of the seminal books on strategy execution and complexity, which were then reviewed in detail to identify and unpack the strategy execution processes and the types of complexity discussed.

In stage three, we went to the field to ask business leaders how they were actually executing strategy and what types of complexity they typically faced in practice. To do this, 39 interviews were conducted with senior executives, middle management and frontline employees in 13 different organisations. At these 13 organisations, an executive, middle manager and frontline employee at each organisation was interviewed for 1–3 hours. They were each asked to describe the steps involved in executing strategy at their organisation, the type of complexity faced at their organisation and by their organisation, how effective they felt their organisation was at strategy execution and what they believed needed to change to better execute strategy at their organisation as complexity changed. The responses from each organisation were only counted where two or more participants expressed that response (e.g. if an executive and frontline employee cited the same strategy execution process, then that process was deemed to be the one in use at that organisation). The interviews were recorded, transcribed and content analysed to identify strategy execution processes actually being used and types of complexity actually faced. The typical areas of frustration experienced during executing strategy as well as the improvement suggestions for these areas and for strategy execution in general were also identified.

Twelve strategy execution processes and five types of complexity were identified in the first three stages of the research. Thus, in the fourth stage, cross-sectional surveys of 241 executive, middle management and frontline employees across 83 organisations and across different organisation sizes, industries and entity types were undertaken. In the survey, participants were asked the extent to which each of the 12 strategy execution processes was in use at their organisation. They were also asked which of the strategy execution activities within each process occurred at their organisation and the extent to which these occurred. Additionally, they were asked which types of complexity were faced at their organisation, how effective they believed their organisation was at strategy execution and the extent to which particular strategy execution frustrations identified in the case study interviews applied at their organisation. The responses were analysed using both structural equation modelling and descriptive statistics.

Structure of this book

The 15 chapters of this book fall into three parts. Part I (Chapters 1–2) discusses the different types of complexity, their dynamics and how to spot each type of complexity at play. It then discusses how changes in complexity affect strategy execution in general and strategy execution processes in particular. Part II (Chapters 3–14) discusses the 12 different processes used to execute strategy. Each process has a dedicated chapter which unpacks the process’ origins, the fundamental problem it seeks to solve, the process’ key steps and activities, any caveats regarding use of the process, what you might know the process as, its prevalence, the types of organisations and environments it is most effective in, how you can know if your organisation is using it, its strengths and shortcomings ...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• List of figures
• Part I Types of complexity and their effects on strategy
• Part II Types of strategy execution processes
• Part III Thriving in complex environments
• Index