Questions & Answers with Dr David Norton

Friday, November 20, 2009 7:01 PM

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Friday, January 16, 2009

Co-author of the Execution Premium, Dr David Norton

Dr David P Norton is founder and director of several organisations specialising in systems and processes to improve the execution of business strategy. Dr Norton has founded and built a series of professional service firms during the course of his career, each focused on leading edge issues of management, from information technology and knowledge management to the discipline of strategy management. Dr Norton, who serves as an author and a frequent lecturer, is best known for his work with The Balanced Scorecard, which has been the subject of many conferences and articles and now for his work in the Execution Premium (co-written with Professor Kaplan).

As Caribbean leaders embark on a new year that promises to be challenging, CEOs and managers must brace themselves and prepare to work tirelessly to find the right strategies to ensure their survival. By linking strategy to operations an organisation will realise competitive advantage and has a greater chance of succeeding. We will be presenting a series of articles on how to efficiently execute strategies and there is no one better than Dr David Norton to advise these managers and leaders about the best ways to link strategy to execution.

Not only is Dr Norton experienced in the field of the execution of strategies, but he was also voted as one of the "World's 12 Most Influential Management Thinkers" by Sun Top Media's Thinkers 50 and as such he is an excellent speaker who will help our leaders to have a fighting chance.
Below is part one of the series of articles, which is an interview that took place on December 16, 2008 with Dr Norton via telephone.

CBR: Your book, The Balanced Score Card, Alignment and others were major hits and now your most recent book, co-authored with Robert Kaplan, is called The Execution Premium. How do you think this book will revolutionalise the way managers, strategists and employees think?

DPN: The Execution Premium was a follow up to the previous books: The Balanced Score Card, The Strategy Focused Organisation, Strategy Maps, and Alignment. Both Kaplan & I have been writing on performance management for a while now - since 1996. The idea for this came along as the world moved from a product-driven economy to a service-driven economy. The world has evolved and has become more dependent on intangible techniques.

Tools such as the Balanced Score Card (BSC) helps an organisation identify and measure intangible assets. The Strategy Map (SM) gives a detailed description and a visualisation of strategies. The BSC converts the SM into a measurable form whilst the Strategy Focused
Organisation addresses best practice issues and how to go about successfully executing strategies.

Executing strategies is no easy task; it takes hard work and dedication. The idea is to build a system that pools ideas together to manage strategy. It is vital and essential to have a system in place in order to manage strategies.

There has been a dramatic impact on organisations performances by the way they choose to manage their strategies. Organisations over the years have taken simple ideas and applied them to complex situations. It is estimated that 70 per cent of organisations that implement performance management programmes use the BSC as their basis.

CBR: All your books seem to stress the importance of linking strategies to operations. Given the current global financial crisis, how much more important is it for organisations to do this?

DPN: In times of economic crisis, strategy is needed more than ever as the pressure and stakes are much higher and there is not much slack, if any at all. Prices and demand are low which leaves little room for errors.

During a recession strategies need to be changed to focus on the short-term plans and then when a certain level of stability is realised the focus may shift to the long term. Look at companies like Best Buy and Ricoh Copiers and how they survived through the recession during 2001. They were smart; they used the methods recommended by myself and Professor Kaplan: they described the strategy, converted the strategy into a measurable form and objectives. Then they communicated the strategy, watched the process, learned from it, made the necessary changes and then applied it to their everyday operations.

Therefore, at all times strategy is essential to the success of any organisation but it must be adjusted to address the issues faced during economic crises.

CBR: As one of the "World's 12 Most Influential Management Thinkers", what do you think is the most common preconception of managers as it relates to developing and implementing strategies?

DPN: Managers tend to be preoccupied with strategy and leave little or no attention to address execution. Nine out of ten organisations fail to execute strategies successfully.
In recent years, the conference board performs a survey about the number one issue managers worry about. The findings were as follows:

. The issue of execution- this issue has always existed however in recent years it has become more dominant

. The ability to be flexible and to react quickly to issues that may arise

Strategies need to be executed effectively and they need to be balanced. The old saying goes to be a successful entrepreneur it takes 10% inspiration and 90% perspiration, likewise to be a successful organisation it takes 10% strategy and 90% execution.

See Part 2 next week

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