Kaplan and Norton (authors of The Balanced Scorecard, The Strategy Focused Organization, and Strategy Maps: Converting Intangible Assets into Tangible Outcomes) provide an addendum to the traditional definition of strategy. First, the traditional: A hypothesis that proposes the direction a company or agency should go to fulfill its vision and maximize the possibility of its future success. Their addendum is: Unique and sustainable ways by which organizations create value. The Strategy Focused Organization says a reasonable expectation for a strategic discussion should answer the question, "Are we doing the right things?" Similarly, ISO 9000 has evolved to address the same questions: "Are we doing things as we planned, and are we realizing the results we expected?"

Both of these examples point out the importance of successfully translating plans (strategies) into actions (implementations) that result in success (sustainability). Unfortunately, this seems to be difficult for a lot of organizations. A recent Booz Allen Hamilton analysis of 1,200 firms with market capitalizations of more than $1 billion found that the poorest performers -- the 360 companies that trailed the S&P 500 between 1999 and 2003 -- destroyed almost seven times more value through strategic missteps than by compliance failures. Fully 87 percent of value destruction was attributable to such failures as management ineffectiveness in reacting to competitive pressures or forecasting customer demand, or operational blunders, such as cost overruns and M&A integration problems (Strategy+Management, December 15, 2004, "It's Time to Take Your SOX Off", Kocoureck, Newfrock, Van Lee).

The Enron scandal pales in comparison to the assessment of the damage done by management ineffectiveness. While the tone of the article weighed into the Sorbanes-Oxley issue, it points out the difficulty management faces in effectively implementing a strategy that sustains, as well as adds to, shareholder value.

It's not to say some aren't successful. Every management How-To book lists examples of its particular method's ability to support management in efforts to improve the bottom line. Though Booz Allen describes management ineffectiveness as a leading cause of shareholder value deterioration, the assessment may be unduly harsh. Granted, management's inability to effectively connect where they want to go with where they're actually going is the basis for the development of tools such as Lean, Six Sigma, Balanced Scorecards, strategy maps, and cascading objectives. However, before these tools were invented we used TQM, Policy Deployment, MBO, and Zero-based budgeting. It's when the aggregate totals are examined that the serious "underbelly" is exposed: a large number of near-complete failures along with countless other outcomes whose results didn't meet expectations. One study showed that over 75% of implementations related to fulfilling some component of strategic intent had either no effect, or actually a negative effect, on the bottom-line. Despite this, management keeps trying and shareholders keep hoping.

Though the tools may differ, successful implementations of strategy share a few characteristics, including some that have been previously described in this monthly newsletter. However, for those of you contemplating a major effort to restore your bottom-line's black ink, perhaps it will be helpful to keep these characteristics in mind.

1. Management is totally committed, not only to the outcome, but to the process as well. It used to be that functional disciplines in an organization were in competition with each other and had an attitude that prevented honest, open cooperation. Senior leadership has to make sure that the same "fiefdom" mentality doesn't still linger in their organization. In addition, the senior person must not delegate responsibility for conveying direction and priority. Otherwise, power struggles among otherwise committed senior team members will be just as divisive as if the commitment was missing.

2. A common understanding of the end point, including the benefits EVERYONE should expect is known. Several studies have shown that the success rates of implementations go up when process knowledge is well understood and broadly relevant. In addition, the knowledge must be clearly disseminated throughout the organization. Having led nearly a dozen turnaround efforts, I have found that resistance melted away when everyone understood three things: (1) What was in it for them on a personal level; (2) Exactly what was expected of them; and (3) Exactly how to meet those expectations.

3. Everyone knows why the implementation effort is important. Not only that, but also knows how his/her role is important to the outcome. People need to know why the outcome is important. If the company is in so much trouble that the reasons are clear (survival) that's fine, but there are all sorts of reasons that people will support. Don't assume that they do understand why it's important or that you have their support. You might find your reasons aren't compelling enough.

4. Everyone is involved. Two benefits can be realized by involving everyone: better ownership and faster results. As a test, count the number of people who have at least weekly requirements to contribute to the final outcome and divide that number by the total number of employees. The further away from 100%, the longer it will take and the more you'll have to struggle to get people to buy in to the process.

5. The Camp is Burned. Sun Tzu wrote, in The Art of War, that a general who is preparing for battle must burn his own camp first, thereby sending a clear message to his troops that if they are to sleep in tents again, it will be in those taken from their enemy. Too many strategic implementations fail because of the pull of "The way its always been". There are long-standing practices in any organization that can subvert the best of intents: a standard costing process using work center efficiency, an out-of-date MRP system, a poorly structured compensation program, a seniority-based promotion policy, or an accounting-driven performance measurement philosophy. Don't think you can be successful if you are not prepared to strip away anything that gets in the way. Burning the camp is when senior leadership's commitment to the process really gets tested.

It isn't whose tools you use or what consultant you hire that makes the difference in a successful strategy implementation. What makes it successful is how you do it. It might help if you remember this. Strategy delivers promises; people and processes deliver results. Good luck.