When developing a strategic plan for your organization, problems—or at least symptoms of them—are easy to identify. Solutions, on the other hand, are less clear. Even when you can determine a course of action, the plan you prescribe may falter; this isn’t necessarily because the strategy incorrectly identified the problem or proposed the wrong solution but because the strategy did not sufficiently establish the capabilities required for it to succeed.
Capabilities represent your organization’s skills, processes, abilities, and capacity, so ignoring them during conversations on strategy can leave critical gaps in the efficacy of that strategy. As Ron Ashkenas and Logan Chandler explain in their recent article in the Harvard Business Review, an organization’s capabilities enable the results it achieves. Thus, in order to change the organization’s results or to generate new ones, then you need to change its capabilities accordingly.
Unfortunately, the key role of capabilities is often overlooked in strategic plans. According to the authors, executives responsible for developing and implementing the new strategy may assume that employees will figure out how to adapt on their own and overlook defining capabilities, which overburdens innovative thinkers and leaves other team members paralyzed by a lack of direction. Alternatively, leaders may issue a hyper-specific, rigorous set of set of best practices for the new strategy that are so inflexible that employees lapse back into old behaviors. In both scenarios, the failure to develop strong capabilities leads the overall strategy to collapse.
To correct these imbalances, Ashkenas and Chandler call on leaders to see capabilities as an essential function of strategy execution. Beyond simply crafting new priorities for departments and teams across the organization, leaders need to use capabilities as the vehicle to show how those priorities will be actualized. This will even help the strategy to succeed because as teams adopt new strategic priorities, they will also adopt new skills, practices, processes, and perhaps even staff in order to make those priorities a reality.
At the same time, capabilities should be kept flexible and open to experimentation by the teams that will carry them out. If the capabilities are too rigid and do not consider elements like culture, work environment, and so on, then they will hinder success. The men and women who will execute both the strategies and capabilities should have the freedom to adjust them when necessary so that they function as a helpful tool rather than a burden.