Implementation May Be More Important Than Strategy
Thirty years ago when I was teaching at Wharton I believed that strategy was more important than implementation. Had anyone challenged me, I would have argued that a great strategy poorly implemented is better than a weak strategy well implemented. I didn’t have to argue this, however, because I didn’t think about it very much. Implementation was not on the radar screen.
Twenty years ago, when my partner Robert Shulman and I were writing our first marketing book we still weren’t worried very much about implementation. We naively (intuitively) believed that if you got the strategy right, everything else would follow.
The counterintuitive discovery we’ve made in the past decade is that the quality of marketing strategy correlates poorly with the quality of implementation. We’ve seen some banks, fast food restaurants, packaged goods companies, automobile manufactures, hardware and software firms, Internet companies, credit card companies, utilities, agribusinesses, telecommunications companies, and pharmaceutical business develop strong strategies, only to watch them fail because of poor implementation.
We find few things more disappointing than working with, say a major bank to help develop a powerful targeting, positioning, product service and pricing strategy, only to see it collect dust on a shelf as operations people, the advertising agency, the public relations firm, and everyone else involved wander off to do their own thing.
Sometimes the quality of the implementation is handicapped by the fact that the marketer does not control all the points of contact with the end user or customer. ExxonMobil Corporation developed and implemented the most powerful, transformational strategy in the gasoline service station industry ever when it launched Friendly Serve. Friendly Serve promised customers speedy service, clean, safe stations, and recognition and rewards for their patronage. It also included, SpeedPass, the automated payment system which rocked the industry, accelerating the sales effects of Friendly Serve throughout the country.
But Friendly Serve could have been ever stronger if all of Mobil’s dealers had participated fully and enthusiastically in the program. They didn’t even when it was in their best interest to do so. Only about 1/3 of the dealers fully implemented the program and among them sales increases were in the neighborhood of 15% or more. Among the 1/3 that did not implement the program, sales changes were flat. Read more about this in the ExxonMobil case history.
This problem is not unique. Insurance companies have major problems implementing marketing programs to consumer though independent agencies. Food marketers have difficulties implementing marketing programs in supermarket powerhouses. Brokerage companies, computer software companies, toy makers, appliance and consumer electronics manufacturers have difficulty in breaking through and gaining the cooperation of the middlemen who stand between them and their customers. It’s one reason why companies move into e-commerce.
Successful implementation requires not only enlisting the support of dealers, independent agents, brokers, and retailers but motivating every person in the organization who has contact with the customer—and every external partner (the ad agency, package design firm, PR agency, digital partner, everyone)—to buy into the strategy.
This is not easy. People resist change, and many people don’t want to be pushed into implementing someone else’s ideas. But it has to be done.
Sometimes it requires an intemperate drill sergeant to make things happen. More usually it takes the hard work of an inspired chief marketing officer who is willing to get down in the weeds and do whatever is necessary to persuade the troops to follow.
And sometimes it takes a visionary CEO who heeds the words of the late Peter Drucker: "A business enterprise has two and only two functions, marketing and innovation. Marketing and innovation produce results, everything else is a cost."