Executing Your Strategy: Taxi or Uber?

September 30, 2021
September 30, 2021 Jamie Notter

Remember the days before Uber, when you’d walk out to the curb and HOPE you’d find a taxi? And when you did find one, you’d expect the vehicle to be in horrible shape, the interior to smell bad, and after you pay (in cash!) you’d get a receipt that looks like it was drawn in crayon. It sounds horrible (and it was), but before Uber, you didn’t have a choice. You didn’t realize what a horrible problem you had—until the innovation showed up.

With that in mind, I now want you now to look at the process you use to take your three-year vision and strategic plan and convert it into an operational reality. If you’re like most associations, the first step in operationalizing your plan is to create an annual budget and work plan. I call this “budget-based execution,” and it works something like this:

You send your department heads off to their individual offices and they develop individual budget proposals for the next 12 months based on what they plan to do. There will be some reconciliation of differences, projections, etc., but you’ll end up with an approved budget, at which point people finalize their detailed operational plans, and then everyone starts executing. Your annual meeting happens, your webinars happen, your dues invoices go out—everyone’s doing their job.

Metaphorically speaking, that’s the taxi system. Yes, you’re getting stuff done (just like yes, you eventually made it to the airport in that taxi back in the day), but using the annual budget as the bridge between strategic vision and execution is actually a horrible way to realize your vision.

Here are just a few of the downsides:

  1. Budget-based execution reduces agility. Big decisions are made only once per year, and if we want to make a change mid-stream it is considered an “exception.” That has a huge psychological effect on us, pushing us to NOT change (it must be “exceptional”). It’s no wonder we’re content with “we’ve always done it that way.”
  2. Budget-based execution reinforces silos. How often do you hear the phrase “my budget?” This approach creates a natural pathway for people to narrow their focus to their work and their department, since that piece of the budget is the only one that affects them. We say we want to bust the silos, yet we rely on a core organizational process that makes that impossible.
  3. Budget-based execution stifles innovation. Not only does the budget-based approach make it hard to change, it also makes it hard to create new things. Innovation is change that unlocks new value, but budgets are by definition about value that we already have identified and recognized. That pushes innovation out to the edges, where it has less of an impact.
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So that’s the bad news, but here’s the good news: there is an Uber-like solution to this problem that you can access right now, and we call it “priority-based execution.”

Priority-based execution is a system that connects the dots among vision, strategy, execution, and culture. Instead of using the budget as the bridge between strategy and execution, it uses organizational priorities, which are continuously revised, on a quarterly basis. You heard me right—every three months you will be developing new priorities for next quarter, while still keeping an eye on those annual or 3-year targets.

The system goes way beyond just quarterly planning, though, and includes specific processes for making people’s work and progress more visibly internally and being much more rigorous around metrics and accountability. That’s where culture comes in. You’ll need to change your culture to successfully implement this system.

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But when you do, you’ll be able to solve the problems caused by budget-based execution:

Priority-based execution increases agility. Your cycle of learning shifts to three months, as you are always analyzing why you either did or did not accomplish those priorities. In fact, learning frequently happens even faster, because part of the system involves generating leading indicator metrics so you’ll see if you’re off track BEFORE the quarter ends, and can adjust.

Priority-based execution makes collaboration more effective. Having true organizational priorities that are visible to everyone will help people determine—on their own—when they should hop across those silo lines and help someone out. The priorities are clearly linked with organizational growth and success, making it much clearer WHY the collaboration is needed, and that means it happens more often.

Priority-based execution unlocks innovation. Clear priorities give you an end point, but there can be many roads that will take you there. That allows teams to identify new solutions or new models for how to achieve the priority, particularly when you can run experiments and learn on a quarterly basis.

Once you start using a priority-based execution system, the deficiencies of the budget-based system will become glaringly obvious, and you’ll wonder why you ever did it that way (kind of like we wonder why we ever tolerated taxis). We support leaders in building out a priority-based execution system through our coaching program, which covers all the elements, from priorities, to metrics, to culture. If you’d like to learn more, you can use this link to schedule a call with me directly.

 

Jamie Notter

Jamie is an author and growth strategist at PROPEL, where he helps leaders integrate culture, strategy, and execution to achieve breakthrough performance and impact. He brings twenty-five years of experience to his work designing culture-driven businesses, and has specialized along the way in areas like conflict resolution and generations. Jamie is also the co-author of three books—Humanize, When Millennials Take Over, and The Non-Obvious Guide to Employee Engagement—and holds a Master’s in conflict resolution from George Mason and a certificate in Organization Development from Georgetown, where he serves as adjunct faculty.
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