Strategy Formulation & Execution
All strategies attempt to ask and answer three straightforward questions:
Where Are We? Where Are We Going? How Are We Going to Get There?
Companies either have a clear strategy or they don’t. If they don’t, we help them build one. If they do, we pressure test it to ensure it’s complete, focused on the right "first things first," and that the leaders most impacted are aligned and ready to engage the organization.
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In our experience, there’s often a significant gap or chasm between those who create strategy and those responsible for executing it. If this gap isn’t addressed early in the 'prepare for change' stage, it will only widen over time. And bridging it isn’t just about repeating high-level strategy statements or forecasting earnings per share three years out. It requires a deeper understanding—not just of the desired future state but also the current reality. Without that, leaders can’t fully internalize what they, their peers, and their teams need to do differently.
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A critical but often missing role in strategy formulation, planning, and execution is a hybrid of strategist, operator, and human engineer—let’s call this the 'Transformational Change Leader' (TCL). The TCL must be able to engage with the authors of strategy, understand brand and customer insights, industry and competitive trends, and financial and operational performance, and translate all of that into a clear, actionable path forward.
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Related Case Studies & Perspectives
The Authors of Strategy
Crossing the Four Strategy Chasms
Chasm 4: A proven roadmap that is company and "change challenge" right, where all leaders know what behaviors to express, model, and reinforce for the change to be successful.
Chasm 1: Leaders who are able to able to understand the strategy 'beyond bumper stickers' or high level objectives; leaders who are aligned with the vision and ready to engage the organization knowing what they, their peers, and their teams need to do differently.
Chasm 2: Leaders driving transformational change must engage in strategy formulation, linking structure to strategy and talent to structure—roles traditional HR isn’t designed for. They also guide sponsors in selecting the right change strategy based on the company’s state, workflows, and the nature of the change.
The Leaders Charged with Execution
Transformational Change Leadership
Chasm 3: A leader who helps others benchmark the current state, map the future state, and identify gaps—whether in capability (knowledge, skills, experience), opportunity (constraints, bottlenecks, barriers), or motivation (climate, culture, engagement). This leader also ensures they understand the behaviors needed to support the change strategy.
The TCL helps lead identification of initiatives, helps apply feasibility vs. attractiveness frames to 'value target' and properly sequence them, organizes the work into logical groupings, and leads the creation of a plan that translates strategy into planning. The TCL is an expert in assessing the degree to which the organizational structure supports the strategy and how the talent needs to be realigned to support the structure. They help the leadership team select the right change strategy, how each leader needs to behave as a team consistent with the change strategy chosen, helps leaders to either praise, course correct, prevent or encourage the behaviors that drive success, and works with the CEO or other executive sponsor to turn strategy into planning and planning into execution.
One of the great ‘chasms’ in formulating and implementing any new strategy is between the authors of strategy and the leaders who are charged with the execution.
Robert Willey, Managing Partner at ROIG
Question 1: Where are we?
There are two schools of thought in strategy. Start with the future state then map back to the current state or start with the current state along with the beliefs about the forces that will likely shape the future then map forward to the future state vision. We believe in the latter approach. Why? Using a basketball analogy, by setting your "pivot foot" in the current state you can better use the free foot to maneuver. The free foot in this analogy is the future strategy. In other words, by starting with the customer, the brand, the industry and competitive environment (size, share, growth of industries), the operating and financial performance of the company, and a solid and realistic assessment of the organizational capabilities of the company we can better set the table for an executable vision, mission, values, and strategies for the future.
REVISE
OPTIMIZE
INCUBATE
GROW
The challenges an organization faces, be that topline demand or bottom line profitability, are fundamentally different across designations.
At ROIG, we believe a company (or business unit within the company) at any given point in time is in one of four states which we call “business designations." The four states are Revive, Optimize, Incubate, and Grow. Why is this important? Because the top-line or customer challenges and bottom-line or profit challenges are fundamentally different from one designation to the other.
Let’s compare the Revive designation to the Growth designation to illustrate the point:
Revive companies typically have an uncompetitive value proposition and a 'broken' business model. Stakeholders do not believe the company will generate profits in excess of its cost of capital into the future. Most Revive companies have liquidity challenges and are limited in what they can even do to turn things around. Time is often as large a challenge as any other. The biggest question Revive companies have to ask and answer is whether to fix, close, or sell.
Stakeholders within Growth companies, on the other hand, not only believe that the company will generate profits in excess of their cost of capital, they believe the company will be even more profitable in the future than it is today. The challenge for growth companies is aligning on which of the 9 Types of Growth to pursue (e.g. organic growth? Product or service diversification? Growth through acquisitions? etc.). Each growth choice will have a 'build, buy, or ally' path.
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Leaders charged with leading transformational change use our Business Designation frame to ensure the company strategy is focused on the right first-things-first action required to become 'remarkable.' Now that we have a sober, realistic view of the current state, let’s move onto the “where are we going?” question.
Question 2: Where are we going?
In horse racing, the Triple Crown refers to the highly difficult task of winning all 3 key races in one year – the Kentucky Derby, the Preakness Stakes and the Belmont Stakes. Only 13 horses have ever won the triple crown in 104 years. This statistic is similar for a company to achieve “Remarkable” status (a learning agile and change agile organization that sees the future as inevitably different and takes steps to be continuously adjustive in everything that matters). Very few are possible…and those who do win, win big.
​The horses and support staff get little rest between each race and are asked to rely on very different sets of skills at very different distances in various settings. Achieving the Triple Crown requires planning and strategy, durability, endurance, and the ability to adjust and adapt. The races are held close together – so it takes a lot of work and focus without a lot of time between races, and it can become daunting for the horses, jockeys and support staff. Remarkable companies not to not only master the strategy race (i.e., “the Derby”) but they must also conquer the talenting and culturing races to become remarkable (i.e., the “Preakness” and “Belmont”, respectively). Before we get to far ahead of ourselves, let’s define what it means to be a Remarkable Company.
Photo credit: istock.com
History of Remarkable
In 2012, one of ROIG’s clients asked for our perspective on what makes a company truly remarkable. With years of experience in this area, we assumed the answer would come easily. Instead, it sparked what has become a 13-year journey of exploration, research, collaboration, and practice. Many leadership voices within ROIG have contributed to what we believe is the definitive framework for shaping the North Star of any company, regardless of industry. We use this framework both as strategic planners—to build strategy—and as leaders of transformational change, to pressure-test existing strategies and ensure they are complete.
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Our research indicates that remarkable companies do three things better than their competition. They delight their customers, they are both strategically and organizationally agile, and the deliver top quartile profitable growth.
What makes an organization REMARKABLE?
They consistently generate profits and deliver the highest salaries to capital.
They are better at anticipating customer needs and turning insights into action.
They are smarter today than yesterday, and strive to be smarter tomorrow.
Four additional elements reveal themselves when the three elements merge to form a Venn diagram. The most over-lapped section at the center represents the promise the company makes to its customer. All other elements represent how the company plans to keep that promise. The why element outlines who the target customer is and how the company will compete and win in the marketplace (leveraging Michael Porter’s Competitive Strategy framework). The why statement includes both 'positive space' (what the company will do) and 'negative space' or the whitespace outside of the circles (what the company will not do) statements. Porter's framework tells us that strategy requires trade-offs. Not every customer is equal, not every function creates comparative advantages and not every dollar should be allocated equally.
How do we allocate (and reallocate) our resources to maximize our current and future ambitions?
Who is our core target customer who drives the most current and future value? How can we best support their needs?
Who are other meaningful sub-segments?
What organizational capabilities are required for success?
To optimize the whole of the organization, some parts must be sub-optimized...but which parts?
Enduring Value
Effectiveness
Efficiency
Understanding the underlying comparative advantages within a company helps define which functions are more important than others and informs key decisions, such as whether to build a capability internally, buy it from others, or partner with an organization that already has it (e.g., build, buy, or ally).
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Warren Buffett once described his version of strategy using the metaphor of a medieval castle. He wants a castle full of treasure, protected by a strong moat to defend against invasion. Remarkable companies accumulate significant treasure and sustain higher levels of profitability and return on invested capital (ROIC) over time.
The remaining overlapping areas are also important to the Remarkable Company framework. The area between delighted customer and agility (labeled Behaviors) represents all the touch points between the company and the customer. This element measure how effectively the company is delivering the value proposition (the why) to the customer.
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For business to consumer (B2C) companies, the goal is to move beyond awareness, trial, repeat, preference, and even loyalty to advocacy. Advocacy is where a tipping point of marketers create demand for the company on its behalf with little or no incentive to do so.
Watch and listen to our Managing Partner discuss the origins and inspirations for our Remarkable Company Framework.
For business to business (B2B) companies, the goals is to often more important to instill confidence (vs. customer-to-customer advocacy). Things like reliability, responsiveness, and being a 'trusted partner' are examples of this.
The area between delighted customer and profitable growth (labeled Results) represents the ongoing vs. transactional relationship between the customer and the company. This is the lifetime revenue, margin, and profits (margin less the all the economic costs to serve that customer) generated from that relationship.
Finally, the area between profitable growth and agility (labeled Process) represents the degree to which the company has efficient standard operating procedures (SOP) and is able to scale its business processes. Remarkable Companies strive to lower the cost to serve the customer and become more efficient while also continuing to innovate.
The Remarkable Company framework is built from three major ideals and seven elements. We use the frame for two purposes:
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As the foundational elements for creating or formulating a new strategy
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As a litmus test to help strategists and leaders of transformational change ensure their strategy is complete
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​Although very few companies ever achieve the highest marks across all three major elements, we believe all companies (regardless of their current state) should build their strategic plans with the goal of becoming remarkable as the end goal.
Question 3: How are we going to get there?
ROIG's Business Designation diagnostics provide you with a robust current state – including a deeper understanding of the underlying comparative advantages within the company that can be used to support the future state. A comparative advantage either comes from the 'outside in' (i.e., the customer gives the company permission to expand into some new territory) or the 'inside out' (i.e., a capability the company has in its existing business that will allow it to provide service or product to other markets or customers). The TCL uses this set of frames to make sure the company is focused on the right 'first things first.'
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The Remarkable Company frame provides a litmus test for any strategy. The TCL uses this frame to make sure the strategy is complete. There is not single right answer or path to becoming remarkable. For example, it works for Costco as well as Amazon in retail or Honeywell as well as Nvidia in manufacturing.
The connective tissue between the current and future states consists of a series of initiatives that span years. These initiatives will either generate demand or improve profitability that comes from mapping best practices to current practices. The initiatives should map back to either delighted customer, agility, and profitable growth. Value Targeting methodologies use feasibility vs. attractiveness dimensions to help identify quick hits, high value but more difficult initiatives, and opportunistic items.
We can help you get there
Transformational leaders look at the business designation (Revive, Optimize, Incubate or Grow), the type of change, the culture of the company (how work gets done), and the degree to which apathy or resistance is the primary enemy of the change and creates a 'change playbook' to guide the planning and execution phases of work.
There are 48 different combinations of big change. Most leaders see 1 or 2 in their careers. Mis-diagnosing the change is one of the biggest mistakes leaders make at this stage. To learn more about this, see either our Transformational Change Capability or 24 Laws of Leading Transformational Change perspective for more details.
The Transformational Change Leader (TCL) plays a crucial role in creating leaders who are not only aligned but also engaged in driving strategy forward. This goes beyond simply echoing C-suite talking points—leaders must develop a deep understanding of the strategy, the organizational shifts needed to support it, and their role in making change successful. Depending on the change strategy chosen by the TCL and agreed upon by the executive sponsor, each leader must actively express, model, and reinforce the behaviors required for success.
Through structured workshops and guided discussions, we help key leaders articulate, in their own words, where the company is today, where it’s headed, and how to navigate the path forward. With the right leadership mindset and a clear path to execution, transformational change doesn’t just happen—it gains momentum, takes hold, and delivers lasting business impact.