I recently came across an article that stated that less than 10% of leaders are good at both strategy and execution. The article also said that only 13 % believed that they are very effective at strategy – a real e shocker for me!
The time factor
In HBR’s “Make strategic thinking part of your Job,” (October 26th, 2016), Rich Horwatch, the CEO of the Strategic Thinking Institute, found that 44% of managers spent most of their time firefighting in cultures that rewarded reactivity and discouraged thoughtfulness. Nearly all leaders (96%) claimed they lacked time for strategic thinking, again because they were too busy putting out fires.
This last point is not surprising to me, given my experience working with organizations where strategy is often at best kept in the head of the leader and little is done to draw from the collective wisdom of the executive team and in the alignment of functions to help deliver it.
The skill reality
If so few leaders believe they are not effective at strategy, is that why strategy isn’t addressed at the board level to a sufficient degree? Is this why so many companies fail to effectively meet the needs of a changing world? Because CEOs don’t know how to ask – or respond to – the right questions? Even in the context of a CEO who believes that he/she is a strong strategist, are they truly looking at things with an eye to disruptive forces in their market or simply refreshing tried and true approaches?
According to Roger Martin, 43% of executives cannot even state their own company’s strategy. In this day and age, you can surround yourself with a team that is good at execution, but if you are the CEO, how can you not be a star at strategy?
Strategy is mission critical
In a growth industry, the CEO and the executive team can better afford to be stronger on execution and weaker on strategy, if they can recognize and seize the opportunities that tend to present themselves. It is not as straightforward in mature industries where a CEO must focus more on strategy to survive and thrive.
The questions boards need to answer are: what kind of leadership does your company have and does it suit the business environment. If the leadership doesn’t suit the competitive landscape, it’s time to engage with the CEO to determine the risks and measures to take.