TURNING GREAT STRATEGY INTO GREAT PERFORMANCE Mankins and Steele

The Strategy-to-Performance Gap Performance is often well below what strategy predicts Survey of executives found that –Companies rarely track performance against long- term plans –Multiyear results rarely meet projections –A lot of value is lost in translation (i.e., no one clearly knows how effective a strategy is) –Performance bottlenecks are frequently invisible to top management –The strategy-to-performance gap fosters a culture of underperformance (lack of performance becomes acceptable and the norm)

Closing the Strategy-to- Performance Gap Rule 1: Keep it simple, make it concrete –(not too abstract and unclear to many) Rule 2: Debate assumptions, not forecasts –(understand the fundamentals and performance drivers) Rule 3: Use a rigorous framework, speak a common language –Use a very thorough and sound framework –Make it possible for corporate center and units to use this framework in their communications

Closing the Strategy-to- Performance Gap (2) Rule 4: Discuss resource deployments early (avoid last minute shortages of resources) Rule 5: Clearly identify priorities (don’t give equal importance to all tactical actions) Rule 6: Continuously monitor performance Rule 7: Reward and develop execution capabilities (need to motivate and develop employees)

The Results? An increase in performance of anywhere from 60% to 100%. More confidence among employees and managers Emergence of a culture of over performance Enhanced reputation within the industry