The Z-axis represents Speed. Speed should not be confused with how quickly things get done (execution). Speed is as much part of an organization’s culture. How quickly does an organization collectively think? What are the rewards, recognition, and controls in place to manage, control, and incentivize associates to help decisions get made more quickly or to just simply think faster?
Most often, organizations can move faster than normal for short periods of time. However, typically, this comes at greater costs (expediting fees, overtime, burning associates out).
Additionally, this can be the slippery slope. When having to rush a project or something for a customer, this creates a strain on the balance of the organization. A back log of work can be created, thus making everything a rush. When everything is a rush, nothing becomes a rush. Companies can be put into vapor lock—like a traffic jam of work to be completed.
Speed includes how associates are empowered to make decisions. What is the process and what are the controls in place to allow less senior associates make decisions to help improve the flow of the business?
Next up, The “Sucky Middle” hashtag#execution hashtag#speed hashtag#strategy hashtag#strategyspeedexecution
Strategy - Speed - Execution (X-axis, Execution)
PART 3 of Several
The X-axis represents Execution. The top listed Google search of "strategy vs execution" (eaglesflight.com) states the following: "Strategic skills allow a leader to create policies, establish direction, and determine how to effectively allocate resources to achieve a larger goal. Execution, on the other hand, involves the tactical, practical skills needed to put a plan into motion."
For our purposes, I define execution as the practical formal and informal processes to complete day to day activities across the different functional areas of the business.
The more formal (codified) the process(es), the more consistent the respective action(s) will be. Consistent application of a process(es) denotes better execution. A better executing company would operate further to the right on the X-axis.
The Y-axis (Strategy) of my Strategy - Speed - Execution theory is first, because intuitively, a strategy should/ would be formulated before Execution and/ or Speed of a business.
Michael Porter state's there are three basic strategies: COST, DIFFERENTIATION, & FOCUS.
However, I look at strategy both tactically and...STRATEGICALLY. What I mean is, a company should have a Vision and Mission statement. What is the reason for existence? Why is it here? Cynics will say, "To make money". Sure, but it should be more than this. Long-term company wealth and growth has to be more than just short-term $$$.
Do these align with the generic strategy? What are the company's core values? Do these align?
Does each employee understand and know what each of these are?
I define a tactical strategy as the overall plan and process related to each functional portion of the business: Sales, Channel, Customer Service, Supply Chain, Marketing, Finance (yes, Finance is included), and other functional portions of the business. How do these align with the above?
The stronger the alignment across these, the higher up the Y-axis the company operates.
This is Part 1 of several detailing my theory regarding a company's Strategy, Speed, & Execution relative to its success by using some clients/ projects as an example. To protect the guilty, all pertinent company information will be anonymous.
I drew the below illustration today (at a lunch meeting) to illustrate the concept.
I am taking the debate of a (1) good strategy and great execution or (2) great strategy and good execution to the next level and incorporating the speed of a company. Additionally, I am agnostic to which is better, 1 or 2. I argue most firms are somewhere in the middle in their success (let's be clear, frank, and honest. FINANCIAL! Everything else is just noise. If a firm is not profitable and not growing, all other things do not matter). Also, most companies can be good during a bull market. Show me a company that outperforms in a bear market! That is one excelling in these three areas.
The Theory: As a firm moves up the Y-axis, they have a better strategy. Moving to the right on the X-axis is indicative of better execution. The Z-axis is the speed of the company. In subsequent parts, I will go into detail on each part.