Execution: The Discipline of Getting Things Done

by Larry Bossidy

We talk to many leaders who fall victim to the gap between promises they’ve made and results their organizations delivered. They frequently tell us they have a problem with accountability—people aren’t doing the things they’re supposed to do to implement a plan. They desperately want to make changes of some kind, but what do they need to change? They don’t know.

Execution paces everything. It enables you to see what’s going on in your industry. It’s the best means for change and transition—better than culture, better than philosophy. Execution-oriented companies change faster than others because they’re closer to the situation.

Leading for execution is not rocket science. It’s very straightforward stuff. The main requirement is that you as a leader have to be deeply and passionately engaged in your organization and honest about its realities with others and yourself.

How good would a sports team be if the coach spent all his time in his office making deals for new players, while delegating actual coaching to an assistant? A coach is effective because he’s constantly observing players individually and collectively on the field and in the locker room. That’s how he gets to know his players and their capabilities, and how they get firsthand the benefit of his experience, wisdom, and expert feedback.

Only the leader can set the tone of the dialogue in the organization. Dialogue is the core of culture and the basic unit of work. How people talk to each other absolutely determines how well the organization will function. Is the dialogue stilted, politicized, fragmented, and butt-covering? Or is it candid and reality-based, raising the right questions, debating them, and finding realistic solutions?

Leading for execution is not about micromanaging, or being “hands-on,” or disempowering people. Rather, it’s about active involvement—doing the things leaders should be doing in the first place. As you read on, you’ll see how leaders who excel at execution immerse themselves in the substance of execution and even some of the key details. They use their knowledge of the business to constantly probe and question. They bring weaknesses to light and rally their people to correct them.

Being present allows you, as a leader, to connect personally with your people, and personal connections help you build your intuitive feel for the business as well as for the people running the business. They also help to personalize the mission you’re asking people to perform. Dick Brown’s personal connections at all levels of the organization at EDS fostered a degree of commitment and passion that simply wouldn’t have existed otherwise. We know of no great leaders, whether in business, politics, the military, religion, or any other field, who didn’t have these personal connections.

As a leader, you have to show up. You’ve got to conduct business reviews. You can’t be detached and removed and absent. When you go to an operation and you run a review of the business, the people may not like what you tell them, but they will say, “At least he cares enough about my business to come and review it with us today. He stayed there for four hours. He quizzed the hell out of us.” Good people want that. It’s a way of raising their dignity. It’s a way of expressing appreciation and a reward for their extensive preparation.

The behavior of a business’s leaders is, ultimately, the behavior of the organization. As such, it’s the foundation of the culture.

Whatever approach you use to determine rewards, the goal is the same: the compensation system has to have the right yields. You should reward not just strong achievements on numbers but also the desirable behaviors that people actually adopt. You should increase the population of A-players, defined as those who are tops in both behavior and performance. You should remove the nonperformers. Over time, your people will get stronger and you’ll get better financial results.

Other leaders design rewards for new behaviors of execution but implement them brutally. They don’t take the important step of helping people to master the new required behaviors. They don’t coach. They don’t teach people to break a major concept down into smaller critical tasks that can be executed in the short term, which is difficult for some people. They don’t conduct the dialogues that surface realities, teach people how to think, or bring issues to closure.

How many meetings have you attended where everyone seemed to agree at the end about what actions would be taken but nothing much actually happened as a result? These are the meetings where there’s no robust debate and therefore nobody states their misgivings. Instead, they simply let the project they didn’t like die a quiet death over time.

You cannot have an execution culture without robust dialogue—one that brings reality to the surface through openness, candor, and informality. Robust dialogue makes an organization effective in gathering information, understanding the information, and reshaping it to produce decisions. It fosters creativity—most innovations and inventions are incubated through robust dialogue. Ultimately, it creates more competitive advantage and shareholder value.

In the people process, for example, when I started, my first thought was always to see how good a person was in a job. After all, that’s what made the business run. As time went on, I still talked about that, but I also kept thinking, What is the growth potential of this person? I began to ask a lot more questions and get dialogue going on long-range potential.

If you look at any business that’s consistently successful, you’ll find that its leaders focus intensely and relentlessly on people selection. Whether you’re the head of a multibillion-dollar corporation or in charge of your first profit center, you cannot delegate the process for selecting and developing leaders. It’s a job you have to love doing.

Common sense tells us the right people have to be in the right jobs. Yet so often they aren’t. What accounts for the mismatches you see every day? The leaders may not know enough about the people they’re appointing. They may pick people with whom they’re comfortable, rather than others who have better skills for the job. They may not have the courage to discriminate between strong and weak performers and take the necessary actions. All of these reflect one absolutely fundamental shortcoming: The leaders aren’t personally committed to the people process and deeply engaged in it.

Or suppose someone you really like isn’t cutting the mustard. Few tough issues are more challenging for indecisive leaders than dealing with people they’ve promoted who are not performing.

Never finish a meeting without clarifying what the follow-through will be, who will do it, when and how they will do it, what resources they will use, and how and when the next review will take place and with whom. And never launch an initiative unless you’re personally committed to it and prepared to see it through until it’s embedded in the DNA of an organization.

One of the many things mechanical evaluations miss is how candidates performed in meeting their commitments—whether they did so in ways that strengthened their organizational and people capability as a whole or weakened it. How leaders meet their commitments is at least as important as whether they meet them and is often more important. Meeting them the wrong way can do enormous damage to an organization.

In a good evaluation, the leader looks closely at how the people under review met their commitments. Which people delivered consistently? Which ones were resourceful, enterprising, and creative in the face of adversity? Who had easy wins and didn’t push for better results? And who met their commitments at the expense of the organization’s morale and long-term performance?

A robust people process does three things. It evaluates individuals accurately and in depth. It provides a framework for identifying and developing the leadership talent—at all levels and of all kinds—the organization will need to execute its strategies down the road. And it fills the leadership pipeline that’s the basis of a strong succession plan.

These kinds of decisions—putting the wrong people in place to execute a key part of a business’s strategy—are common. Whether they’re expanding abroad or launching a new domestic plan, far too many leaders don’t ask the most basic questions: Who are the people who are going to execute that strategy, and can they do it?

Even the best people process doesn’t always get the right people in the right jobs, and it can’t make everybody into a good performer. Some managers have been promoted beyond their capabilities and need to be put in lesser jobs. Others just have to be moved out. The final test of a people process is how well it distinguishes between these two types, and how well leaders handle the painful actions they have to take.

A strong strategic plan must address the following questions: What is the assessment of the external environment? How well do you understand the existing customers and markets? What is the best way to grow the business profitably, and what are the obstacles to growth? Who is the competition? Can the business execute the strategy? Are the short term and long term balanced? What are the important milestones for executing the plan? What are the critical issues facing the business? How will the business make money on a sustainable basis?

It’s not just the leader alone who has to be present and involved. All of the people accountable for executing the plan need to help construct it.

An operating plan is not about green eye-shades putting numbers together. It’s a total responsibility. It ties a thread through people, strategy, and operations, and it translates into assigning goals and objectives for the next year. You really want the operating plan to be owned by everybody. The more people you get involved in the plan, either through contingency plans or projects that have to be undertaken in the coming year—the more people who are aware of the expectations for them—the more you achieve.

We see three major flaws in the budgeting or operations process at most companies. First, the process doesn’t provide for robust dialogue on the plan’s assumptions. Second, the budget is built around the results that top management wants, but it doesn’t discuss or specify the action programs that will make those outcomes a reality. Third, the process doesn’t provide coaching opportunities for people to learn the totality of the business, or develop the social architecture of working together in common cause.

This kind of budget process defeats the very purpose of planning. In the months between the time the budget preparations begin and final approval (some take as long as four months), the environment has probably changed. But the assumptions behind the budget remain. A static document in an active world, it reduces the organization’s flexibility to respond to change. And it does nothing to help people synchronize the many moving parts of the organization.

Debate on assumptions is one of the most critical parts of any operating review—not just the big-picture assumptions but assumptions specifically linked with their effects on the business, segment by segment, item by item. That’s a key part of what’s missing in the standard budget review. You cannot set realistic goals until you’ve debated the assumptions behind them.

You have to debate the underlying assumptions before you even begin to think about a financial expression of numbers. As a leader, you question all the way down the line whether people have thought through all the ingredients in the plan. You need to be able to identify any assumptions that might be troublesome, in case they don’t spot them. You are not saying in the back of your mind, There’s no way these guys are going to make this plan, so as to later smile and say, “I told you so.” You want to do all you can to help them make the plan.

Most important, the discussions must include close attention to gross margins. Too many people look for revenue gains without planning to build or protect gross margins at the same time. But gross margins are where the bottom line comes from—all operating expenses are deducted from the gross margin, not the revenues. Everything flows from gross margins. If you can’t get the pricing you need to achieve them, then you have to cut costs.

Any good review ends with closure and follow-through. Without them, you’re apt to get one of those meetings where people nod their heads in agreement, only to start wriggling out of the deals a few days later. The leader has to be sure that each person has carried away the right information and taken accountability for what he or she agreed to do. One powerful technique is to send each person a memo outlining the details of the agreements.