The Silent Killers of Strategy Implementation and Learning

Doctors call high cholesterol a “silent killer” because it blocks arteries with no outward symptoms. Companies, too, have silent killers working below the surface — mutually reinforcing barriers that block strategy implementation and organizational learning. The silent killers can be overcome, but first leaders must engage people throughout their organizations in an honest conversation about the barriers and their underlying causes. Companies have long known that, to be competitive, they must develop a good strategy and then appropriately realign structure, systems, leadership behavior, human resource policies, culture, values and management processes.1 Easier said than done. Between the ideal of strategic alignment and the reality of implementation lie many difficulties. For one thing, senior managers get lulled into believing that a well-conceived strategy communicated to the organization equals implementation. For another, they approach change in a narrow, nonsystemic and programmatic manner that does not address root causes. We began our research on strategy implementation when CEO Ray Gilmartin and chief strategy officer Ralph Biggadike of Becton Dickinson recognized that perfectly sound strategies were not easily implemented.2 Nowhere was the challenge more evident than in their global strategy. As is often the case, good intentions embodied in a new structure were not sufficient to change behavior.3 Teams created to enact strategies across several geographic regions couldn’t seem to coordinate their research and development, manufacturing and marketing. A worldwide educational program created to demonstrate how the global organization should work failed to overcome barriers.4 At the business-unit level, too, the lack of cross-functional systems blocked strategy implementation. Like other companies we know, Becton Dickinson bought in to the structures consultants recommended, but a gap appeared between knowing what to do and actually doing it.5 For a decade, we have conducted research focused on understanding the root causes of the difficulties that Becton Dickinson and others encounter when responding to shifts in competitive strategy. Using an inquiry and action-learning method we call “Organizational Fitness Profiling (OFP),” we enlist a team of senior managers to serve as our co-investigators. The process provides a window for understanding deeply rooted barriers that are common to an array of companies. (See “Organizational Fitness Profiling.

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References

1. M. Beer, “Organization Change and Development” (Santa Monica, California: Goodyear Publishing, 1980); and

N. Venkatraman and J.C. Camillus, “Exploring the Concept of ‘Fit’ in Strategic Management,” The Academy of Management Review, Mississippi State, 9 (July 1984): 513–526.

2. M. Beer and A. Williamson, “Becton Dickinson (A): Corporate Strategy and Culture,” Harvard Business School case no. 9-491-151 (Boston: Harvard Business School Publishing Corporation, 1991).

3. M. Beer, R. Eisenstat and B. Spector, “The Critical Path to Corporate Renewal” (Boston: Harvard Business School Press, 1990);

G. Hall, J. Rosenthal and J. Wade, “How to Make Reengineering Really Work,” Harvard Business Review 71 (November–December 1993): 19; and

R.H. Schaffer, “The Breakthrough Strategy: Using Short-Term Success To Build the High Performance Organization” (New York: HarperBusiness, 1990).

4. R. Biggadike, “Research in Managing the Multinational Company: A Practitioner’s Experiences,” in “Managing the Global Firm,” eds. C. Bartlett, Y. Doz and G. Hedlund (London: Routledge, 1991).

5. J. Pfeffer and R.I. Sutton, “The Knowing Doing Gap” (Boston: Harvard Business School Press, 2000).

6. M. Beer and R.A. Eisenstat, “Developing an Organization Capable of Strategy Implementation and Learning,” Human Relations (May 1996): 597–619.

7. M. Beer and R.A. Eisenstat, “The Silent Killers: Overcoming Barriers to Organizational Fitness,” working paper, Harvard Business School, Boston, Massachusetts, 1996.

8. D. Hambrich, “Fragmentation and the Other Problems CEOs Have With Their Top Teams,” California Management Review 37, no. 3 (Spring 1995): 110; and

K. Eisenhardt, K.M Kahwajy and L.J. Bourgeois, “How Management Teams Can Have a Good Fight,” Harvard Business Review 75, no. 4 (July–August 1999): 77–85.

9. M. Beer and G. Rogers, Hewlett Packard’s Santa Rosa Systems Division (A): “The Trials and Tribulations of a Legacy,” Harvard Business School case no. 9-498-011 (Boston: Harvard Business School Publishing, July 19, 1999).

10. Ibid.;

Eisenhardt et al., “How Management Teams Can Have a Good Fight” (1999); and

P. Lawrence and J. Lorsch, “Organization and Environment” (Boston: Harvard Business School Press, 1967).

11. M. Beer and M. Gibbs, “Apple Computer: Corporate Strategy and Culture,” abridged Harvard Business School case no. 9-495-0441 (Boston: Harvard Business School Publishing Corporation, 1990).

12. S.W. Floyd and B. Woolridge, “Managing Strategic Consensus: The Foundations of Effective Implementation,” Academy of Management Executive (November 1992): 27–39.

13. Beer and Gibbs, “Apple Computer,” 1990.

14. M.W. McCall, “The Lessons of Experience: How Successful Executives Develop on the Job” (Lexington, Massachusetts: Lexington Books, 1988); and

M.W. McCall, “High Flyers: Developing the Next Generation of Leaders” (Boston: Harvard Business School Press, 1998).

15. M. Beer, R.A. Eisenstat and B. Spector, “The Critical Path to Corporate Renewal” (Boston: Harvard Business School Press, 1990).

16. Beer, Eisenstat and Spector, “The Critical Path to Corporate Renewal,” 1990.

17. D. Dunphy, “Embracing Paradox: Top Down vs. Participative Management of Organizational Change” and W. Bennis, “The Leadership of Change,” in “Breaking the Code of Change,” eds. M. Beer and N. Nohria (Boston: Harvard Business School Press, in press).

18. C. Argyris, “Good Communication That Blocks Learning,” Harvard Business Review 72 (July–August, 1994): 77–85; and

E. Shapiro, R.E. Eccles and T.L. Soske, “Consulting: Has the Solution Become Part of the Problem?” Sloan Management Review 34 (Summer 1993): 89–95.

19. Carol Hymowitz, “How To Tell When a CEO Is Toast,” The Wall Street Journal, April 18, 2000, p. B1.

20. J. Gabarro, “The Dynamics of Taking Charge” (Boston: Harvard Business School Press, 1987); and

B. Virany, M. Tushman and E. Romanelli, “Executive Succession and Organizational Outcomes in Turbulent Environments: An Organizational Learning Approach,” Organizational Science 3 (February 1, 1992): 72–91.

21. P. Senge, “The Fifth Discipline” (New York: Doubleday, 1990).

22. John Kotter’s research has documented the shortage of leaders in corporations and his recent book documents the errors managers make in leading change. See J. Kotter, “A Force for Change” (New York: Free Press, 1990).

23. See M. Beer and G. Rogers, “Hewlett Packard’s Santa Rosa Systems Division (Al) (A2) (A3) (A4) and (B3),” Harvard Business School case no. 9-498-011 (Boston: Harvard Business School Publishing, 1997).

24. H. Mintzberg, “The Rise and Fall of Strategic Planning: Reconceiving Roles for Planning, Plans, Planners” (New York: Free Press, 1994).