Research on the strategy-execution gap

Executives disclose in a survey we conducted that their companies have significant shortcomings when it comes to developing and executing strategy. Indeed, 42% of executives admit they are significantly concerned about at least one barrier to successful strategy and execution and another 54% have some concern; only 4% indicate that they are not concerned about any barrier. Fully 55% of executives believe that their company isn’t focused on execution. (The survey garnered responses from 500+ executives at all levels of seniority and from companies of various sizes, geographies, and industries.)

Executives see shortcomings in their company’s strategy

It’s not that companies aren’t trying to execute their strategies. It’s that the strategies often aren’t implementable and aren’t designed to win. Indeed, leaders frequently focus too much on screening the market for opportunities that look interesting and not enough on identifying the strategic opportunities their company is uniquely well positioned to pursue – those that will give them a right to win.

According to the survey:

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  • 46% of respondents say they’re concerned their company’s strategy isn’t bold enough and that "the goals it sets aren’t high enough for us to win."
  • 39% express concern that their company’s strategy isn’t coherent – that it doesn’t "leverage our most important capabilities, assets, or resources across the entire organization."
  • 33% worry that their company’s strategy is not clear enough about "how we create unique value for our customers."

Companies struggle to implement their strategy

Executives are even more concerned about their company’s ability to implement its strategy. Indeed, according to the survey:

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  • A majority of executives – 55% – say they are concerned that their company "is not focused on executing our strategy."
  • 42% of executives say their company isn’t aligned behind their strategy, that "some parts of the organization don’t understand or resist it."
  • The same percentage – 42% – are worried that their company’s strategy asks people to "work on too many, and often conflicting, priorities."

Distinctive capabilities are key for companies to win in the market

Many executives recognize the importance that capabilities play for companies’ success. Indeed, according to the survey, those who felt comfortable saying their company is “currently winning in the market” were most likely to attribute that success to:

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  • Great leadership (27%) OR
  • Powerful and distinctive capabilities (25%)

In order to win in the market and close the strategy-execution gap that concerns almost all executives, companies need to develop a strategy that is executable and make sure their everyday actions are in line with that strategy. That requires being very clear about the few capabilities that will set them apart from their competitors and building a strategy on those strengths. Then, the most important success factor in executing the strategy is to engage everyone in developing or enhancing those capabilities providing focus and joint purpose. Companies that aren’t focused on the few capabilities that differentiate them in the marketplace are all too often trying to be good at many things – and end up being great at nothing.

To learn more about what you might be capable of, take the Right-to-win exercise or consult our Way-to-play tool.


Additional content

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View this one-page graphic highlighting data on executives’ concerns about their companies’ strategies and their ability to execute them.
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View the survey fact pack to learn more about executives’ strategy-execution concerns.
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Read our press release for the strategy-execution survey.
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