Thursday, February 11, 2010

A Few Words About Execution

(..and other related topics.)

With economic recovery the mode of operation for businesses this year, the idea of Execution has established itself with renewed importance. Execution is seen as a differentiator between success and failure, an urgent imperative that business ignores at its peril. But like most business ideas, no single word or idea can substitute for understanding one's own business or the environment where it operates. Considering whether execution really amounts to anything requires more than superficial consideration to sort out the real value from the hype.

What is Execution?

In the Pantheon of Business Ideas, Execution generally sits somewhere between strategy and other elements of the business. According to software maker SuccessFactors, Execution is what allows strategy and human capital to converge, and, not coincidentally that is where their Execution software offering is positioned. Larry Bossidy and Ram Charan devoted a book to Execution built on three pillars: People, Strategy and Operations. In football, the analogy to business is easily drawn where strategy is the playbook or the game plan, and execution is how well the plays are run, measured by yards gained or lost and, ultimately, touchdowns scored.

Typically Execution thinking is structured in such a way as to position execution as an active, unifying force between several essential components. Leveraging or marrying human and strategic assets is a fairly typical way of seeing it. Execution is almost always a management-centric concept: we (management) have our strategy, we have our people, these game pieces need something to create our success synergistically, and that something is Execution. This makes sense, after all it is the job of management to execute plans and bring about financial success for the company. The question is how to look at execution: what are its building blocks? how can it be best understood and successfully undertaken?

What the different concepts of Execution have in common, and why the idea has currency, are that whatever execution is, if it's done right then the business is measurably successful. Quarterly results meet or exceed expectations. Revenue is realized. Costs are controlled. All is well in the world.


Premises of Business Thinking

Underlying this mechanism is the assumption that the business succeeded in doing what it set out to do. We strategized. We planned. We executed, and we were successful. This view of business is rationalistic and intentional. Equally plausible may be the explanation that "we showed up every day, kept doing what we've been doing all along. Customers bought things. We cashed their checks. We're making money somehow." While this latter picture may be more plausible to working people than the former, it is not so self-satisfying to those who would claim the lion's share of rewards for everybody's hard work.

And so emerges the latest post-hoc differentiator between businesses that succeed and those that do not. Execution.

The pro-active-identifying business of today views execution as a key to strategic success going forward, not merely a way of explaining away past success or failure. So "how to do " execution is naturally of great interest to herds of managers wanting to stay with their peers, ahead of the curve.

Several assumptions are common to many diverse concepts of execution so as to be almost essential. First, the rightness of management. Rationalistic goal-oriented thinking which dominates business requires a positive outlook to its core. Though a strong individualistic bias may be in or out of fashion at any given moment, the idea that a person in control of others must naturally be competent and deserving of that position is always found in self-justifying management philosophies. Corollaries to this include the idea of individual merit leading to promotion, hard work being rewarded, and such like. For execution, this implies that people desire success and work to succeed according to a system of rules and policies put in place by wise and experienced managers. Therefore, the thinking goes, failure is the result of systemic breakdown that prevents honest hardworking people from achieving their desired results. The innovative part of the execution paradigm is that it empowers everyone in the organization to take hold of their strategic initiatives and pull at the oars with new-found commitment to realizing strategy.

Positive thinking is another important premise for an execution paradigm. Very rarely are people venal, uncaring, lazy, or angry at the benevolent system in which their lives are constituted. Systemic failure is an unfortunate but acceptable reality in many businesses. Human factors are largely said to be off the table: the system is well-designed and attended by hard-working, qualified and talented individuals. Blame has no place in a modern organization, especially when directed at those considered responsible for the operation of the enterprise (i.e. managers): instead, problems are opportunities and solutions are the proper focus. The positivist assumption is most important to an execution paradigm where the contributions of workers (labeled "human capital" or "human assets" or "talent") are seen as a key to success.

A third assumption is systems thinking. This is the belief that a business (or any other) enterprise is an interconnected set of functions which can be performed by the kinds of people just described. This structure allows each individual to assume the role of a specialized part within a greater whole. And the whole, we all know, is greater than the sum of its parts. In other words, the big organism we call a "company" or "organization" somehow achieves a kind of synergy when all the functions and processes operate in concert. So that any one individual could not do a scaled-down version of what a corporate enterprise is capable of. This idea goes back to old enlightenment-era treatises on the division of labor, but has taken on new significance during the last half of the 20th century with the rise of social sciences and systems thinking. It is unquestioned that a business should be regarded like a computer or a car, with numerous component parts, tirelessly performing specialized functions, over and over. Even with the more recent resurgence of individualism the systems premise is deeply rooted in the way we regard work, and operates in the concept of any execution paradigm.

So from the assumptions that management is wise and well-intentioned, that workers likewise are honest, dedicated, and hard-working, and that the rationalistic plans laid down by the one for the other should, under ideal circumstances, succeed, proving all the assumptions true, it naturally follows that the problems or opportunities that make execution important consist in shortcomings of the execution-unaware paradigm. If nobody is lazy, indifferent, vengeful toward management, petty, and everyone is trustworthy and committed to the same goals, then it is easy to see that failings of the system must be classified in a way that is nobody's fault. From the systems paradigm, we can see that the enterprise, like other complex organisms, can "get sick" from time to time. Like any machine it can suffer the failure of an individual part, or the failure of the related components to work together.

An Alternate View

This is not the only way to see a business enterprise, but the set of premises above will well-equip most of us to speak the language and practice the culture of business. I would propose that there are other ways of viewing our collective efforts that serve our humanity better and can inform an execution outlook as well as everyday life.

The first edifice to topple is the assumption that everyone in a business is equally motivated by some shared belief in the goals of the organization. In proposing the need to examine execution, the explanation is often given that goals and strategies are poorly communicated to front-line workers. How can it be that anyone can do a job in such a situation? Simple: people are told what is expected of them (trained), and they adapt. Further, a person in a job is motivated to meet local expectations for job and social performance in order to perpetuate the economic benefit of maintaining their position. Execution thinking suggests that knowing the point of what they are doing will motivate workers to greater success. While this may be true, there are many countervailing reasons why it might not work.

The belief in the inherent goodness and merit of everyone in the enterprise and especially management deserves further scrutiny. People in groups may usually be counted on to perpetuate the culture of the group, but this does not make anyone the kind of overachiever that business-talk usually pretends. People devote a great share of their time to a job, and inevitably feel tired, stressed, angry, anxious, inadequate, and numerous other things on a daily basis. We are fallible. We fail each other constantly, and we fail ourselves. Our goals and ambitions are not met by others or by our organizations and we are left to suffer in silence while watching others get promoted for reasons we can't fathom. We await a performance review for a chance to hear how our manager values us, only to learn that our hard work is valued somewhat less than the manager's completion of the burdensome review task. We expect too much from each other, and are naturally and routinely disappointed by our desire to feel the way management platitudes suggest we should. An execution initiative cannot solve any of these problems: they are human problems that attend each person's life on a level deeper than workplace strategies can reach.

And finally, what is it about a workplace that is so unsatisfying yet so compelling? Why should anyone want to put themselves into an unhappy situation, to expend such great effort and so much time to be unappreciated and ill-rewarded for all that trouble? Is there satisfaction in making oneself a commodity? Is there quiet dignity in pretending to be a machine part, a shiny bearing or a cam or motor, that spins around or moves back and forth all day consistently and reliably while the local aristocrats play golf in the afternoon, dedicated in their own way to perpetuating the system of unequal rewards and general daytime activity that keeps you connected and functioning? This kind of question is central to the idea of a business enterprise as a system, but never will be addressed by any execution initiative.


Components of an Execution Paradigm

What execution aims to do is to reinvigorate business processes, much the way reinvention and reengineering did in past years. An important distinction in execution is that business functions and processes are not so much the focus. However, there is a general process to an execution initiative, and it goes something like this:

1. Evaluate your strategies. Take into account the markets you want to succeed in, the competitors you want to beat, and other aspects of your business arena.

2. Evaluate your capabilities. This means, what can your people do well in your organization as it is now constituted? Also, where does your organization fall short in the abilities needed to execute the strategy.

3. Make strategic investments and divestments. Focus on what it will take for your people to meet your objectives. Incentives? More training? Personal Development? These humanistic-sounding tactics are based on the fact that you're going to demand a commitment from your people to achieving the strategic goals you've set for them. For those people who are not on board and for business functions that are not required for success in the markets you intend to compete in, get rid of them.

4. Communicate clearly your expectations with respect to your strategic goals, which markets you want to win, and how important success is to everybody. Work with your employees to brainstorm what tactics will advance your goals. Act as a well-functioning team, with everyone's contribution needed and highly valued.

5. Monitor progress toward your goals, in an engaged and thoughtful manner. Continue to listen to employees' feedback, recognize and reward their achievements, and try to help them overcome hurdles they face. Continue to stress the importance of succeeding together.

An ongoing execution focus as so described is supposed to solve the following business problems:

- lack of clear focus or direction
- elegant strategies never realized
- dwindling resources and tightening markets
- adherence to management trends, fads, and overpaid consultants
- disconnect between management and workers
- a "business as usual" mentality
- skepticism toward or fear of "change" (i.e. layoffs)
- entrenchment, "old-boys'" network, office politics.

Clearly, there is value in trying to engage a workforce in the pursuit of specific goals. Just as clearly, leadership is an important component of that. However, it is not so clear that the idea of success through execution focus is anything but self-fulfilling. As useful as the noble ideas about transparency, open communication, and worker empowerment are toward securing shared commitment, putting them into practice has been tried throughout the history of business with varying success. Here are some examples of how faulty assumptions like those detailed above have undermined past attempts to execute successfully.

- Pitting employees or department functions against one another: Telling the accounting department they need to cut costs and telling the engineering department to do whatever it takes to be successful is one example of a recipe for failure. Despite shared goals, tactics must be unified.

- Belief in the Inherent Rightness of Management: Second-guess your beliefs. Encourage your peers to second-guess your beliefs, as well as their own. In the end you will need to move forward with imperfect ideas, so try your best to understand the risks that accompany the courses of action you are considering, and manage those risks as you go. It's better to honestly face up to potential problems ahead of time than to be blindsided by real problems you failed to anticipate.

- Results-orientation-blindness: Management thinking has progressed from a "do as I say" mentality to its 180-degree opposite: the "set your own goals" philosophy. Execution thinking must continually express success in terms of strategic goals, not merely accept employees' or managers' stated achievements as a good outcome. It is difficult to challenge a positive report, but important to do so. Equally important is to engage healthy worker skepticism about management decisions in light of strategic goals. Done right, questioning can foster respect and renew focus on the company's strategy.

- Overwork: If everyone is committed to the company's strategic goals, no amount of work is too great for achieving those goals, right? Wrong. There are times when the best contribution is to do nothing. Other times demand additional effort. If taking on extra workload "for the team" becomes the norm then it's time to ask again if the strategy or its expectations have become unrealistic, and if the person taking on excessive work has an agenda beyond the success of the company.

- Failure to Reassess Strategies: Like revenue targets, strategies may be developed on an annual basis and then just left in place as the focus shifts to execution. This means that after setting goals the company has just under 12 months to lose track of changing market conditions, to allow internal capabilities to fall out of sync with business needs, and to miss opportunities to leverage existing capabilities in new ways. While some strategic elements should remain fixed over the year if at all possible, such as financial targets, other elements do not and should not require this kind of immutability.

- Throwing Money at Problems: There are numerous ways to approach an Execution initiative. The worst way probably is to hire a consultant firm or buy a software package promising "Execution" instead of thinking through the process, developing the methods and doing the work it takes to understand and communicate the different points involved. There is no way around this hard work, except not to take it on in the first place.

- Breach of Trust: In all human relationships there is a continuum of trust: trust is at one end, mistrust at the other. Both conditions can exist at the same time in high or low degrees. Trust itself is a complex and deep emotional state, too much for any business article or blog entry to address. However, for purposes of understanding any business initiative requiring human involvement, recognize that both trust and mistrust are factors in all human interactions. Trust takes a long time to develop and is easily damaged. Mistrust, likewise, is easy to develop and takes a long time and lots of engagement to remove. And trust and mistrust play into all business interactions. With this in mind, it is misguided to assume that management imperatives will be met with openness and willingness to commit. Trying to force the issue and eliminate alternatives can never increase trust; what it does instead is to engender adaptation on the part of the employee in the form of fake trust. Fortunately, in most cases human desire to be in trusting relationships provides an implicit level of "functional trust" which, while not the same as real trust, allows participants in a group to fulfill moderate expectations placed on them. Management cannot leverage fake trust, but can leverage functional trust in pursuing business goals. To leverage trust, either real or functional, involves the same imperatives: one must be trustworthy in order to merit such consideration from others. Stating expectations, and honoring and recognizing commitments are the best ways to engender trust. Breaching or betraying trust, engendering mistrust through dishonesty or even mere disengagement are the surest paths to failing Execution, failed strategy, and failed relationships.