Execution: The Discipline of Getting Things Done

"Execution is the great unaddressed issue in the business world today. Its absence is the single biggest obstacle to success and the cause of most of the disappointments that are mistakenly attributed to other causes."

— Larry Bossidy and Ram Charan

Bossidy spent more than three decades at General Electric, where he became vice chairman, and in 1991 took over as CEO of AlliedSignal, which he later merged with Honeywell. Charan was a Baker Scholar at Harvard, where he did his MBA and his doctorate, and has spent decades advising CEOs and boards of large companies. The book brings together the experience of the operator and that of the advisor who has watched many leaders fail at the same thing.

The authors start from an observation: most leaders devote their energy to high-level strategy and consider execution a tactical matter to be delegated. That's why there are so many companies with good plans and bad results. The gap between what is promised and what is delivered is explained by the lack of a discipline for asking how, who and when, and for following through to the end.

The discipline rests on three building blocks. The first is seven behaviors of the leader:

• Know your people and your business. Be in the operation, not just in the reports.
• Insist on realism. Have reality told as it is, starting with you.
• Set clear goals and priorities. Few, simple and understood by everyone.
• Follow through. Every agreement has an owner, a date and a review.
• Reward the doers. Let compensation clearly distinguish performance.
• Expand people's capabilities. Every conversation is an opportunity to teach.
• Know yourself. The emotional fortitude to hear opposing views and tell uncomfortable truths.

The other two are a culture that links behaviors to results, and having the right people in the right jobs, a task the leader doesn't delegate.

On those foundations run three core processes:

• The people process. The most important. It evaluates each person not only for what they do today, but for whether they'll be able to handle tomorrow's job, and builds the bench of successors.
• The strategy process. It's put together by those who will execute it, in each business unit, and tested against the question of whether the organization has the capacity to carry it out.
• The operations process. It translates the strategy into an annual plan with goals, budgets and owners, and connects it to the people who will deliver it.

The central case is AlliedSignal itself. When Bossidy arrived in 1991, he found processes that were empty rituals, extremely long strategic plans, executives who had been in the same job too long and plants run by accountants instead of production people. The answer was to build the three processes and run them in person. By the merger with Honeywell in 1999, return on equity had risen from 10 to 28 percent. Bossidy sums it up by saying they created a discipline of execution.

The mistake the authors see most often is that of the leader who drifts away from the operation because he believes his job is to think big. That leader doesn't know what's going on, can't ask the right questions and ends up surprised by the results.

How to start this process? Take your company's three priorities for this quarter and, for each, write who the owner is, what the next concrete step is and when you'll review it. Put those reviews on your calendar as if they were customer meetings. At the end of every team meeting, close with the same question: who does what, by when.

As a founder it will help you stop seeing execution as something to delegate and understand it as the core of your job, especially when the company grows and you're no longer in every decision. It also gives you a criterion for evaluating executives: not by how well they present the strategy, but by how well they follow through.