Recognize a strong strategy execution

Strategy without tactics is the slowest route to victory, Tactics without strategy, is the noise before defeat.
(Sun Tzu, 2016)

In the previous adventure blogs we described some building blocks to recognize the dynamics of an effective organization in healthcare. The thus fare described framework (organizing effective structures) makes us realize there is no golden key to success. We describe an approach to find synergy between the logics and the bounded opportunities the customers, employees, structures, finance and market gives. But there is something very important going on in successful organisations of healthcare. They don’t only got an effective (narrative) organogram they also execute their strategy very successfully (Kemperman, Geelhoed, & op ‘t Hoog, 2016; Pijl, 2018).

THE COMPETITIVE MARKET: ‘BE UNIQUE NOT THE BEST!’

One of my favourite books beside the Bible is: ‘The art of war’ of Sun Tzu. I have read the book so many times because it has so many deep insights in how to manage ideas, people and yourself. And when I started to read the books of Michael Porter (Magretta, 2012). I realised a great weakness in the Art of War. It is focused in being the best in a competitive world. And Michael Porter a professor on Harvard saw in many organisations not a strategy. And in some organisations he saw a strategy but focused on to be the best in a market with often all the destructive consequences. Michael Porter emphasise in all of his work that a company should not focus on be the best but on how to be unique in a competitive market. A Volkswagen does provide a set of needs of the customer like durability but a Volvo attract also a kind of customers because it provide a set of needs they need, like safety. And in healthcare the same principle rules. What make us unique? And how do we strategize it?

Quinn (2003) says about this topic:

‘A strategy is the pattern or plan that integrates an organization’s major goals, policies, and action sequences into a cohesive whole. A well-formulated strategy helps to marshal and allocate an organization’s resources into a unique and viable posture based on its relative internal competencies and shortcomings, anticipated changes in the environment and contingent moves by intelligent opponents’.

And in the spirit of Sun Tzu you don’t need only a plan but also a set of tools to implement the plan, we must not see strategy as just a component of the bigger picture but as a definition how we create value for our customer and our legacy. So we are talking about a plan that needs to be implemented in a way it moves towards our formulated goals. Pijl (2018) calls this strategy execution. Strategy is not only a well written document. Its ‘everything’! Strategy defines our identity. And this is needed

because the logics, the powers, structures and customer’s needs, need to meet each other, so a constructive circular feedback process can do her work. Berenschot calls this circular feedback process the strategical dialogue (Wieke, et al., 2012). Strategy is about choosing your focus, analyse the internal and external powers, oversee the options, finding a relevant translation, execution powerfully, decide by thrusts, monitoring adequately and making a responsible decision again. An endless circle of experimenting, failing, learning, success and celebrating.

And this process is constantly needed to repeat in all levels of the organization. The voice of the customer need to be potentialize by the leaders. The voice of financial threats need to bring leaders down to earth. The voice of the employee need to be concerned by leaders and those must be placed in a strategical dialogue in order it strengthen the organizational hybridization (see blog: ‘Recognize an effective organizational structure’).

CREATE COMPETITIVE ADVANTAGE BY STRATEGY EXECUTION

Pijl (2018) described in his book: ‘Strategy=Execution’ a modern vision based on studies of more than 100 organisations. The success factors he distillates out of his findings are highly applicable. He emphasize that if you want continuity for your organization, start radically with creating competitive advantage by strategy execution! The difference between profit and loss is the execution strength of the organisation. Organisations who are excellent in strategy execution:
Achieve significant higher revenue, productivity and performances.
Realise 50% short time reduction in execution.
Realise 15-25% more goals.

SUCCESS FACTOR 1: DISTINGUISH ‘RUN’AND CHANGE’

Pijl (2018) repeatedly emphasize that organisations need to give strategy execution oxygen by making a difference between ‘run’ and ‘change’! When we think about ‘run’ we ask ourselves the question: ‘How good are we in realising our goals in our existing organisation: ‘managerial excellence’. The way we execute our daily management, in short ‘run’.When we think about ‘change’ we ask ourselves the question: ‘How good are we in realizing in changing our business in order to fit the customers need’. Like projects, programmes, intervene in the ‘line’ organisation, it’s called change management, in short ‘change’.

Pijl (2018) suggest that in both planning and implementing you must make a difference between ‘run’ and ‘change’. By making the difference you make ‘run’ and ‘change’ controllable and containable. Its sup optimal when there is no fundamental organisational difference between both. Too often the ‘line’ management execute all of the strategy execution while most of the execution issues need an own focus and approach. Pijl (2018) often sees people working in the ‘run’ environment making strategies or plans for both ‘run’ and ‘change’, but making plans and implementations demands a different kind of expertise. Expertise of the ‘change’ environment (customer, customer journey, market, change management)! 

Pijl (2018) conclude that project- and programmatic based working is the necessity to make strategy execution work. The weak point in his vision is that in reality the ‘line’ are often part of an innovative project or renewing program, by lack of finance or strategical choices. I want to suggest that when it goes about projects, programmes, intervene in the ‘line’ organisation let it be coordinated by experts in project/change management (outside the ‘line’). What I do like in the vision of Pijl is not only the difference between Run and Change. But also the refinement of Change. He says 3 types of change need to be in balance to keep competitive in the market:

1. Improvement of the existing business model
Stracciatella vision: the connection between WLZ and WMO and environment, standardizations of skills, creating credibility by customer.
To strengthen the position in market (short terms)
2. Renewal of the existing business model
Stracciatella vision: radical change to reduce cost, productivity and synergie (thinking as an intrapreneur)
To strengthen the position in market. (middle long terms)
3. Innovation. A new business model
Stracciatella vision: working on a new product like Family House, Training House.
To survive and create a dominant position in market. (long terms)

So project and program management is not only for innovation (creating a new product) but this expertise should also be used in the improvement and renewal of the existing products and intervene with ‘line’ management.

✓ How can we be unique? 

✓ How can we distinguish Run and Change in a way it strengthen the alignment of the organisation?

✓ How can we strengthen our strategy execution? 

✓ What’s our vision on internalizing IDQ?

✓ Are we using the right tools and the right people to execute and create a strategy?

SUCCESS FACTOR 2: DO NOT BE TEMPTED INTO ONE-SIDEDNESS!

Pijl (2018): ‘Stop with formulating long vision and strategy! Execution and agility are more important than manufacturability’ 

In health care we see a market that is rapidly and radically changing. The revenue in WMO now and WLZ at a later stage will be shifting to paying by result and control of costs. Organisations have to do it with more and more paucity of finance, time and resources. So organisations need to make a continuously consideration in a changing market and short amount of time between strategical ambition and the ability to execution. How? By let go the old way of endless analysing market development, SWOT, planning how to grow, let go all of the old managerial thinking of creating stability in the organisation. It does not exist anymore and lead to shabby results! It’s a disruptive time Pijl (2018). So Pijl (2018) says in short:
Create a higher goal and a systematic search of trial, error and unexpected outcomes (Aris, 2016).
Make a compact strategy whereby the execution runs in short cycles.
Make a strategy that will be confront as soon as possible with practice that gives information which agility is needed to conduct an optimal execution of the strategy.
Strategy is a sharp definition of the challenges that’s waiting for us.
Strategy is a plan of action and a list of concrete coherent actions that result from it.
Strategy execution is bringing balance between top-down and bottom up.
Strategy execution is bringing balance between hard elements (processes, structures) and soft elements (culture, behaviour and style of leaders and cooperation)
And make every year based on ‘that’ information a decisions of portfolio of initiatives.

And that’s all this paper goes about bringing things in balance so we can build a competitive advantage. And it’s needed to see that dominantly bottom up way of organizing is a wrong way to develop. It’s a dangerous road to think all employees in the ‘line’ can analyse the needs of the markets and translate it to renewal, improvement and innovation. Employees needs clear frameworks. So strategy need to be made every 2-3 years with a compact blueprint with short cycles, work packages of analyse, design execution and a business case (Pijl,2018).
A strong vision is necessary because its decisive for profitability. The profitability of an organisations with a strong and worn vision is 25% higher than an organisation with a lack of good vision (Collins & Porras, 2005).
Agility is needed it’s the capability to adapt endlessly without changing. Researches find out that organisations with a great agility have 37% more revenue and 30% more growth then organisation who are not agile. So Agility corelate with profitable growth and is crucial factor for success (Unit, 2018). In practice, it is essential for the MT to go every month in a helicopter view to see where agility is needed.

SUCCESS FACTOR 3: MAKE DIGITAL INNOVATION A PRIORITY!

If you want to survive as health care organisation we need to develop a digital innovation strategy, simply because our environment is digital and our customers use their telephones and internet as their second part of their body. If we want to reach our customers, digital innovation is the key (Belleghem, 2016). Pijl (2018) suggest that an organisation need to develop the ability to accelerate in project based working, because coordination between processes, technology and people is needed. Pijl (2018) calls this ability the Innovation and Digital Quotient (IDQ). Company’s need to internalize IDQ in their DNA by:

Create a chapter digital strategy: define the digital innovation for the coming years, with an output that innovative products and services delivers every year a bigger benefit.
The digital vision and strategy needs to create movement: describe the customer journey/intimacy. What are the fundamental needs of our customers on local level?
Create value by working together with digital voluntary platforms, other digital tools of healthcare organisations, apps during services.
Digital innovation ask a strong top-down leadership, create a clear, well known and supported digital governance philosophy. A 1000 growing flowers does not create successes. It needs to be executed by the top management themselves (Pijl, 2018).
A fresh perspective on HR: imagine what make people ZZP-ers? Is it an own Tablet or more self-regulation on time? Identify the needs and try to give solutions! So people enjoy their work!
Marketing, marketing, marketing, give this discipline a place in top management, middle management, support staff and on the work floor.
Make digital innovation part of the culture. According to research 2/3 of the employees does not know the vision of the organisation (Pijl, 2018).

This blog is part 4 of the adventure Strategy, Vision and Leadership.