In any industry, and given identical market conditions, there are always five percent of companies that outperform the competition. They’re not lucky; they are simply better at planning and executing. Having solid systems in place for both garners measurable results in terms of employee engagement and customer experience — and therefore your bottom line.

Is developing talent an organizational imperative at your company? If not, you’re undoubtedly missing opportunities to convert your customer base into effective and committed brand evangelists. An organization is always a reflection of its leadership. In his book The Breakthrough Company, Keith McFarland writes, “the best way for a leader to get the right people on the bus is to create a bus worth riding.”

In Jim Collins’ newest research book, he characterizes 10 companies that outperformed the general stock market by 32 times as being “fanatical about discipline.” Both Collins and McFarland also state emphatically that these top CEOs use outside experts as “scaffolding” to help in specific important business areas.

Warnings

Are you doing all you can to systemize your planning and execution? Or are you getting in your own way? Be aware of these factors, which are often stumbling blocks on the way to great execution:

• Being good: Being good is actually the enemy of greatness. It is very difficult to execute at a higher level when your company is having a good year. Most CEOs have a hard time getting their organization to embrace change when things appear to be going well. However, change is required to elevate daily execution of plans to make the customer experience even greater.
• Being comfortable: Comfortable is close to complacent. If the executive team is comfortable with the way the organization is performing, it will not be willing to raise the bar and make execution a top priority.
• Leadership fit: If the CEO is not willing to embrace or sponsor a complete assessment of every leader in the organization, then he or she must be willing to accept that the team will have some leaders who are simply never going to execute at a high level.

The research is clear

An organization’s inability to execute — which fundamentally means keep its promise to its customers — is the number-one reason for CEO terminations. Equally sobering is this fact: “High performers generate 48 to 129 percent higher revenue than average ‘C’ performers,” says a McKinsey & Company talent survey. In Collins’ book Built to Last, which is still one of the top 12 business books of all time, he states great performance is about one percent vision and 99 percent alignment and execution. In the Balanced Scorecard Report, David Norton was quoted as saying “90 percent of organizations fail to execute their strategies.” Steven Taub of CFO.com draws a clear and important correlation, in that companies are delivering only about two-thirds of their potential due to failures in planning and execution. In a Fortune magazine article titled, “John Lankford Why CEOs Fail,” authors Ram Charan and Geoffrey Colvin don’t attribute failures, or at least 70 percent of them, to bad strategy. Instead, they state, “It’s bad execution. As simple as that: not getting things done, being indecisive, not delivering on commitments.”

Of course, your front-line employees are usually the ones who touch customers every day. Unfortunately, in a Harvard Business Review article, Robert Kaplan states, “95 percent of the typical company’s workers are unaware of, or don’t understand, its strategy.”

In a recent national study performed jointly by Premier Development Solutions and Naviga Business Services, business owners and executives were asked, “What percentage of your organization executes its plan of top priorities consistently?” Nearly 40 percent of those executives surveyed answered that less than half of their organization does. Additionally, 36.1 percent of respondents said they would rehire less than half of their entire management team as top performers. And the icing on the cake? Almost 35 percent said that less than half of their entire management team could effectively articulate their individual top four priorities for 2012.

With statistics such as that, most of those companies likely have poor morale. Even worse, customers’ experiences with those companies’ products and services are surely low as well.