Kasper Lindøe Pedersen- Strategy Essential

Creating a centre to control and adjust the process of strategy execution

Think like NASA: Build a mission control center

One of the key propositions of my thesis is the Strategy Execution Control Centre (SECC), which is a focal point of strategy execution with the mandate to control and adjust the process of strategy execution. The SECC will have the responsibility for translating the strategy and will also act as a simulator for the execution process, where small-scale tests and pilot projects will be carried out to ensure the quality and feasibility of the strategy. The SECC would also be a key driver of cultural change, in order to build a culture that supports and emphasizes strategy execution.

“Top managers are a bit like astronauts who circle the earth in the space shuttle. It may be the astronauts who get all the glory, but everyone knows that the real intelligence behind the mission is located firmly on the ground.”  – Hamel & Prahalad (1989)

Have you ever watched the movie Apollo 13? If you have, you would have seen the following sequence: ““Flight controllers listen up. Give me a go, no go for launch: Booster: ““go””, RETRO: ““go””, FIDO: ““go””, Guidance: ““go””, Surgeon: ““go””, EECOM: ““go””, GNC: ““go””, TELMU: ““go””, Control: ““go””, Procedures: ““go””, INCO: ““go””, FAO: ““go””, Network: ““go””, Recovery: ““go””, CAPCOM: ““go””. Launch Control this is Houston, we are ““go”” for launch””.

When NASA launches a rocket or a space shuttle from Cape Canaveral in Florida, the shuttle itself is only a small fraction of the system that makes it all possible. The organization draws on a vast pool of experts, technology, engineers, knowledge and other resources. The movie sequence above illustrates the multitude of smaller parts that altogether comprise the NASA mission control. The mission control with all its analysts, computers and other high-tech equipment keeps track of the progress of the mission. It measures everything from air pressure in the space craft, altitude, fuel level and speed to the medical condition of the astronauts. The mission control runs the mission from a highly detailed flight plan while responding and adapting the management of the mission to the key performance indicators it measures.

The mission control centre of NASA therefore constitutes a vital support system for the space mission, without which the missions (and thereby the strategy) would never be successfully executed.

In the same way an organization needs a support system to guide and facilitate the execution of strategy. I have called this support system the Strategy Execution Control Centre (SECC).

Guiding the execution of strategy

Kaplan & Norton (2005) have pointed to the fact that strategy is often carried out in isolation in many different functions and departments, with no guidance from the enterprise strategy: ““This partition of responsibilities create the gulf between an organization’’s strategy and its processes, systems and people””. Their observation is in fact that the organization’s strategy is separated from the rest of the organization, when the responsibility for its execution is broken up and placed in multiple parts of the organization.

Gadiesh & Gilbert (2001) have pointed to the challenge of decentralization, which many companies face: ““Decentralization is becoming common at companies of all stripes; thus, there is a corresponding need for a mechanism to ensure coherent strategic action””. Instead of partitioning the responsibility for strategy execution, which also makes it difficult for managers to administer, due to the complexity and quantity of supervision, the organization should establish a SECC to facilitate and guide strategy execution throughout the organization.

The role of the SECC

It is the role of the SECC to coordinate and facilitate all the various tasks and processes of the strategy execution model, and thereby to establish the framework for strategy execution. It is not the role of the SECC to do all the work, but to ensure that execution gets accomplished in an integrated fashion across the organization. The SECC is an anchoring function that works as the modus operandi in coordinating the strategy execution process.

The purpose of the SECC is not to create a new bureaucracy within the organization or to provide a new set of exclusive titles for talented managers. The SECC must not acquire monopoly over the strategy execution process and thereby create a new aristocracy with the authority to override the decisions made by lower level managers –– effectively lowering the motivation to execute strategy. Instead it is the purpose of the SECC to provide a connection between the various departments and functions in the organization and the strategy, in the effort to execute it.

In this way the SECC can facilitate and guide the execution of strategy, rather than dominating and intervening. In that sense the SECC is not an authoritative department like any other, but works rather as an intermediary between the existing functions that comprise the organization. The SECC should have a consultative and integrative role between the respective functional departments. Its contribution should be competence, know-how, expertise, experience, assistance and inspiration.

Translating strategy into action

It is the responsibility of the SECC to translate the strategy and identify the strategic initiatives and objectives required to realize the strategy. It is also the responsibility of the SECC to identify the performance targets and metrics by which the various functions are measured, in order to keep track of the progress. The SECC also ensures that the strategy gets communicated to all employees, with the emphasis on awareness and comprehensibility. It is also the responsibility of the SECC to facilitate the coordination between managers and functions as well as making sure that sufficient resources have been conferred to the strategy execution process.

The SECC also works as an execution simulator –– just like the space shuttle simulator at NASA. The simulator’’s role is to test and adapt the assumptions, beliefs, estimates, forecasts and hypotheses of the strategy to ensure that the execution effort does not falter because of a poor or vague foundation for the strategy. The SECC therefore, carries out multiple tests and pilot projects on a small scale, to limit the risk of going full-scale too early in the process. The simulator is a pivotal part of the adaptation process in strategy execution, to ensure that ““reality”” is brought into the strategy.

According to Kaplan & Norton (2005) who have proposed the establishment of an office of strategy management (OSM), which seems to be the ultimate in scorecard management; the establishment of this kind of function may seem to reinforce top-down decision-making and create a barrier for local initiative. The reality is that it does just the opposite: ““A unit with responsibility for the implementation of strategy becomes a convenient focal point for ideas that percolate up through the organization. These emerging ideas can then be put on the agendas of quarterly and annual strategy reviews, with the best concepts being adopted and embedded in enterprise and business unit strategies”” (Kaplan & Norton, 2005). This way the SECC not only facilitates and guides strategy execution, it also works as a stage-gate function for innovation and business development in the organization.

It does so because, unlike organizations that do not have this kind of function; the SECC can effectively catch the ideas that are being generated throughout the organization, and have the knowledge of how to put the ideas to work and into consideration.

Bridging the gap between strategy formulation and execution

The SECC basically works to fill the gap that exists between strategy formulation and strategy execution. It brings together all relevant functions in the organization and facilitates the cooperation between them, in order to execute strategy.

Imagine if an organization had this Strategy Execution Control Centre, the launch of the execution might sound something like this: ““Execution controllers listen up. Give me a go, no go for execution: Metrics: ““go””, Resources: ““go””, Communications: ““go””, HR: ““go””, Production: ““go””, Control: ““go””, Procedures: ““go””, Procurement: ““go””, Finance: ““go””, R&D: ““go””, Simulator: ““go””, Sales: ““go””. CEO this is SECC, we are ““go”” for execution””.

Perhaps a bit less theatrical, but the general idea is the same: A Strategy Execution Control Centre could not only make strategy execution more visible to the organization and emphasize its importance, it would institutionalize the process and develop the ability to execute ““flawlessly”” and continuously.

Furthermore, not only would the SECC institutionalize the strategy execution process, it would also build an organizational culture that supports strategy execution, by slowly changing and stimulating behaviour and by eroding the barriers that damage the process.

Summary

By establishing a Strategy Execution Control Centre (SECC) with responsibility for managing the execution and implementation processes, the organization can make strategy execution visible and emphasize its importance. It would also institutionalize the process and develop the ability to execute strategy ““flawlessly”” and continuously.
The SECC would constitute a support structure for the strategy execution process that can facilitate and guide the process from formulation to realization. However, to truly leverage successful strategy execution, the organization must emphasize the need to incorporate execution into the corporate culture. When everyone is focused on executing strategy, the organization will develop resilience towards the complications that will inevitably arise during the execution process, and the risk of strategy execution failure will be significantly reduced.

This article was taken from Kasper’s thesis “Cracking the Code of Strategy Execution”. Kasper Lindøe Pedersen