Course Meeting Times
Lectures: 2 sessions / week, 1.5 hours / session
Prerequisites
Enrollment preference given to Sloan Master of Business Administration students.
Introduction to the Course
A recent survey of more than 400 global CEOs revealed that excellence in execution was the number one challenge facing corporate leaders in Asia, Europe, and the Americas, topping a list of 84 issues including innovation, geopolitical instability, and top-line growth. These executives are right to worry about execution. Between one-half and two-thirds of companies fall short when it comes to achieving their strategic priorities.
Strategy execution is important and difficult, so you might expect it to be a core concern in business schools. Despite its importance, strategy execution is not well understood. An amazon.com search for “business strategy,” produces 65,000 books, while “strategy implementation” and “strategy execution” together yield fewer than 2,000 books.
The dominant view of strategy execution is, at its heart, mechanistic. After setting a direction, top leaders manipulate “levers of control” to break their strategy into goals, assign these objectives down the hierarchy, measure progress, and reward performance. This approach, developed in an era when executives wore fedoras to work, is ill-suited to current market realities. Today, companies must balance strategic persistence with the agility to respond to unexpected changes—i.e., flexible execution (or flexecution for short). This course is organized around the seven components of the Flexible Execution model:
- Strategy for Execution. An organization’s strategy describes how it will get its present state to a desired future. A strategy for execution must provide sufficient structure to guide actions and trade-offs, but leave enough latitude to respond to changing conditions. We will focus on strategic priorities as a tool to balance direction with agility.
- Shared context measures how well leaders responsible for execution understand what matters, why it matters, and how the organization is doing against its strategic priorities. The best way to build and maintain shared context is not one-way communication, such as email blasts from the CEO, but through ongoing discussions among key leaders throughout the organization.
- Goals 2.0 refers to the processes—including goal setting, performance feedback, and incentives—that organizations use to align activities with strategic priorities. To balance flexibility and alignment, goals should be revisited quarterly, ambitious, linked to metrics and milestones, and transparent throughout the organization.
- Distributed leaders oversee key teams, and represent the central nodes in the organizational network. Most distributed leaders will be middle managers running business units, functions, or regions, but this group may also include technical experts or thought leaders critical to executing strategy.
- Resource re-allocation refers to the formal and informal processes to allocate, and more importantly re-allocate, the cash, people, and managerial attention required to achieve strategic objectives as market circumstances change. We will focus on simple rules as a tool to shift resources without losing sight of strategic priorities.
- Corporate culture is the bundle of values that are deeply held and widely shared throughout the organization, and thereby shape behavior on a day-to-day basis. We will discuss how to quantify corporate culture, the importance of fit between values and strategy, and how to change culture over time.
- Top leaders are responsible for taking a holistic view, and ensuring that all components of the Flexible Execution model are working together to execute on their organization’s strategy.
Course Objectives
This course is designed for students who intend to work in general management positions in start-ups, large corporations, or not-for-profit organizations at some point in their career. The course will also be useful for students who plan to work as management consultants after graduation.
This course is designed to help MIT Sloan students bridge the gap between strategy and execution in four ways.
- Present an alternative to the mechanistic view of strategy execution that reframes an organization as a complex network of teams ceaselessly adjusting to market conditions and to other teams.
- Introduce the Flexible Execution Model, consisting of seven elements—strategy for execution, shared context, goals 2.0, resource re-allocation, distributed leaders, top leaders, and execution culture—that together shape how well an organization executes its strategy.
- Discuss a set of practical tools—based on research and field-tested in the real world—that help leaders achieve their organizations’ strategic priorities. Explore novel ways to use data—including surveys, Glassdoor reviews, and other sources—to measure strategy execution and identify what is and is not working.
Grading and Requirements
| Activities | Percentages |
|---|---|
| Class attendance and participation | 25% |
| Pre-class surveys | 25% |
| Two class preparation memos (team) | 50% |
This class is offered pass/fail. To pass the course, student must complete the following requirements:
Class Participation
This course relies heavily on discussing and learning, from case studies and articles. We will spend a substantial portion of several class discussing the assigned case or article, an interactive process designed to surface multiple viewpoints, and debate their pros and cons. Given the cumulative nature of the course and the important role that classroom interaction plays, attendance is mandatory for every session. If you cannot attend a session, please notify the teaching assistant via email before the class commences. We will track class participation, and all students are expected to participate in our class discussion on a regular basis to pass the course.
Pre-class Surveys
For most classes, a brief pre-class survey will be distributed the day before class.
Class Preparation Memos
Twice during the course, students must submit a two-page memorandum of analysis and recommendations for a case study or assigned reading. These memos are a team assignment.
More details about these requirements can be found in the Assignments section.
Calendar and Key Dates
| Ses# | Topics | Key Dates |
|---|---|---|
| 1 | What Strategy Execution Is (and Isn’t) | Strategic Priorities memo due |
| 2 | Strategy for Execution | |
| 3 | Goals 2.0 | |
| 4 | Simple Rules | Canadian Compression Corporation memo due |
| 5 | Simple Rules in Action | |
| 6 | Execution Culture | Henkel memo due |
| 7 | Building an Execution Culture | |
| 8 | The Execution Loop | |
| 9 | The Execution Loop (cont.) | Silvio Napoli at Schindler India memo due |
| 10 | Leading Execution From the Middle | Carnival Cruise Lines memo due |
| 11 | Executing Strategy in Volatile Markets | |
| 12 | Competing on Agility |
