(Interloper) “The confusion between the brilliance of a strategy and the ability to execute on it is at the heart of every poorly managed company. Far too often, a lack of corporate performance is blamed on a bad strategy when the strategy was perfectly fine. In other words, the architect is always blamed when the house falls collapses but the fault is more likely to lie with the builders.”
“There is a pervasive myth, propagated rabidly by biz schools and business consultants, that a new “great management paradigm” has just arisen (cough-sixsigma-cough) that will transform your company into a global behemoth. The truth is that there is no premium on corporate strategy ideas – they are everywhere. The talent that is almost nonexistent is execution.”
“What Jack Welch actually did in practice was fire entire buildings full of people in under-performing businesses, to the point where he was given the nickname Neutron Jack. Anyone could have come up with the idea of getting rid of poor businesses and focus on their successful counterparts, but it took a singular talent like Welch to execute.”
“What Buffett does, for instance, is about as complicated as Welch’s strategy – buy companies with consistent long term ROE assisted by competitive advantage when they are trading, ignored, at lower than historical valuation levels. His execution of the strategy, the unparalleled discipline, is what sets him apart.”
“All of this is not to say that managing money or global industrial companies is easy. The point is that, while there are multi-bazillion dollar industries trying to convince you otherwise, “The Plan” doesn’t really matter, it’s the person implementing the plan that does.”
Full Story: CEOs and Investors: Strategy/Execution Distinction Separates Good from Bad (Interloper)
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