The Strategy - Execution Gap

Summary of "The Strategy Gap"

1. The Strategy Gap Defined:
There is a disconnect in large enterprises between the high-level strategy created by elite consultants (like McKinsey or Bain) and the actual execution at the business unit level. While CEOs hire top firms to create grand strategies, those plans often fail to trickle down into actionable, practical guidance for the people responsible for delivering results.

2. The Reality of Corporate Strategy:
These high-level strategies are often generic, involving cost-cutting, restructuring, and growth targets like “12% this year.” However, business unit leaders face real-world challenges (market conditions, internal capabilities, competition) that make such goals unrealistic without clear, grounded strategic direction.

3. Fake vs. Real Strategy:
Many companies operate on what the speaker calls “fake strategy” – lists of projects or vague goals without logical, causal connections to desired outcomes. True strategy is about solving problems with a clear guiding policy and a coherent set of actions that are logically linked to results.

4. Dysfunction is the Norm:
Most large enterprises are inherently dysfunctional. They operate with matrix structures, centralized functions, and misalignment between departments like product, sales, and marketing. This dysfunction makes it harder to execute on strategic plans.

5. Solution – Collaborative Strategy Development:
Effective strategy comes from bringing together the smartest people across functions (not just the strategy department) to think critically, debate, and co-create hypotheses. This approach builds alignment and leads to more realistic and testable strategies.

6. Scientific, Root-Cause Thinking:
Good strategy is rooted in identifying the real problem, forming a guiding policy to address it, and designing actions that logically lead to the desired outcome. Like in medicine, treating symptoms (rather than root causes) leads to recurring issues.

7. Strategy Should Be Simple:
A good strategy can and should be expressed simply—ideally in one page. The analysis and data supporting it go in the appendix. If a company can’t hit its numbers, its strategy isn’t working, regardless of how elaborate the planning process is.

8. Teaching Strategy to Companies:
The goal is to teach high-potential individuals inside companies to do real strategic thinking—better than McKinsey—so that the organization can continue developing strategy independently and effectively in the future.