People-focused knowledge management

The Strategy Is Not Implemented by Rank-and-File!
Stubb Corporation’s president and CEO Paul Nary was
appalled at how badly Stubb’s strategy was implemented. Only
four months ago, with the help of outside consultants, it was
determined that Stubb’s key strengths were centered around 
customer relations and quality leadership and their strategy
should focus on attaining market leadership based on these
strengths. Such a strategy was considered certain to succeed
because the marketplace considered Stubb to have excellent rela-
tions and products. In anticipation of increased business, Stubb
proactively increased its labor force by about 10 percent across
all departments to ascertain that new workers were competent
when they would be needed.
After a few months, however, the strategy was not being
properly implemented by lower-level managers, supervisors, and
rank-and-file. Instead of making tradeoffs in favor of quality
and good customer service, they frequently focused on internal
issues and minutiae such as maintaining low inventories,
smoothing production line flows, minimizing scrap rates, and
reducing the costs of supplies and consumables. Costly bicker-
ing and finger-pointing were also occurring between mainte-
nance and production departments.
Paul called in a consultant, Pete Storm, who specialized in
strategy implementation to find what was wrong. Pete found
that several aspects worked against the strategy. First, whereas
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people throughout Stubb read and knew the strategy slogans,
they did not really understand what the strategy entailed, and
most did not see how their own work would help to implement
the strategy. Second, people did not see how achieving good
strategy implementation would be of value to themselves. They
really were not interested in implementing the strategy. They
were more interested in keeping their own work problem-free
and maintaining good relations with coworkers and superiors.
Pete identified internal Stubb initiatives that were counter-
productive. Hence, operating cost containment efforts that dealt
with inventories, scrap, consumables, and so on, ended up to be
of greater concern than effective strategy implementation. In
addition, current operating practice and culture did not support
the rank-and-file’s effort to make independent decisions to 
innovate and improvise on operational guidelines in order to
achieve strategic benefits.
Pete recommended that a different approach be taken to
communicating the strategy, its implementation, what it would
mean for the company, how each job could participate in its
implementation, and the value it would have for each employee
to succeed. It would also be important to help people understand
how they could resolve conflicts between strategy issues and
other issues such as the cost containment efforts. These initia-
tives would require considerable work on the part of manage-
ment and the people throughout the organization. Pete also
emphasized to Paul that, in order to achieve successful strategy
implementation, it would be necessary to loosen management
control and give people greater decision latitude — which in turn
also required building additional expertise in the workforce.