In their new book, “Strategy That Works: How Winning Companies Close the Strategy-to-Execution Gap,” (scheduled to be published in February 2016 by Harvard Business Review Press) authors Paul Leinwald and Cesare Mainardi identify how some of the best companies in the world (including Amazon, IKEA, JCI Automotive Systems Group and Qualcomm) use five fundamental principles to out-execute and outcompete their competitors.
“There is a path to value creation that comparatively few companies have followed in the past, but that would lead many companies to success if they followed it,” the authors state. “It is consistent, practical and sustainable – albeit counterintuitive to many businesspeople.”
The five acts of unconventional leadership at the core of their book are the practices that enable all of the companies they studied to close the execution gap. They are:
Commit to an identity.
Successful companies deliberately commit themselves to an identity based not on what they sell, but on what they do. Having made this commitment, they only enter competitive arenas where they believe they have a “right to win” – where their identity and their capabilities give them the edge.
Translate the strategic into the everyday.
Coherent companies create a blueprint that defines their most distinctive capabilities. They build and refine them, and then bring them to scale across their enterprise. These capabilities are complex and highly cross-functional combinations of processes, tools, knowledge, skills and organization – all put in place to reliably and consistently deliver a particular outcome.
Put your culture to work.
The culture of a company – the way people collectively think and behave – can either reinforce or undermine a leader’s strategy. Companies that bridge the strategy-to-execution gap view their culture as their greatest asset. People bring emotional energy to work, feel mutually accountable for results and develop a kind of collective mastery that is hard to duplicate.
Cut costs to grow stronger.
Companies that execute on their strategies best spend more than their competitors do on what matters most to them and as little as possible on everything else. They base their decisions about where to cut and where to invest on the need to support their value proposition and differentiate themselves around capabilities.
Shape your future.
The “super competitors” identified by Leinwald and Mainardi anticipate how their capabilities need to evolve. They make the necessary investments early enough that they will be out in front of changes in the world around them.
