Strategy and Operations in the Enterprise:
Closing the Alignment Gap
© Copyright Forbes 2009
1
Key Findings
• Economic volatility has put companies under greater pressure to align strategy and operations. This alignment could be
more important post-recovery as they ready their plans to capitalize on new market opportunities.
• Changing market conditions that affect strategy and operational execution are the number one barrier companies face
in aligning strategy and operations. Other top barriers cited by executives include: added pressure from the current
economy on short-term costs versus longer-term return on investment (ROI); lack of availability of timely, accurate data;
lack of effective communication of strategic goals to operational employees; and operational risks and opportunities that
are not incorporated into overall corporate strategy.
• Alignment gaps may also arise due to differences in strategic and operational goals. Asked about short- and longterm priorities, strategic functions focused on competitive differentiation, while operations is coming under increasing
pressure to boost efficiency and manage costs.
• There are concerns that employee recruitment, retention and training are not aligned with strategy, or that resources are
not allocated properly to ensure that the workforce can achieve strategic goals.
• Managing regulation and risk is another area of concern. Executives indicated that regulatory compliance issues
frequently impact strategic execution. A failure to incorporate changes to risk models into strategic plans may further
hamper alignment.
Survival in today’s complex business environment
demands effective and decisive action. Using clear,
accurate and accessible information, companies can
develop a stronger competitive position by effectively
adjusting their strategies and processes to respond to
changing market conditions.
But to accomplish this, they need the visibility and
focus to ensure that their strategic priorities are in line with
their operational realities. Does the company have the right
resources in place to manage growth? Is front-line information readily available to drive strategic decisions? How
are risks or regulatory challenges being managed?
Despite agreement on the necessity of aligning strategy
and operations, many companies still face significant barriers that may prevent them from achieving this. Executives
on both sides of the strategy/operations aisle express
© Copyright Forbes 2009
concern that strategic priorities may be out of sync with
operational realities, in particular in critical areas such as
risk management and talent allocation and retention.
Intensifying this split are the sudden shifts companies
have had to make to deal with the impact of the global
recession and resulting economic volatility. But it is clear
that many executives believe the time to more closely align
strategy and operations is now, to protect the company in
the short term and to help it map out the long-term growth
initiatives for the eventual economic recovery.
To identify the specific challenges enterprises face in
closing the gap between strategy and operations, Forbes
Insights, in association with SAP, surveyed more than 200
C-level and senior executives at global enterprises with
annual revenues exceeding $500 million. An additional
ten on-the-record and off-the-record interviews were conducted with senior executives to obtain first-hand insights
into how companies are managing alignment issues.
2
Figure 1. Given the current challenging economy,
has your company updated or revised its corporate
strategy and/or priorities to address these pressures?
Figure 2. Has the current economic situation put
you under additional pressure to focus on aligning
strategy and execution?
Figure 3. Does your organization have an updated
plan in place to guide strategy once the economy
turns around?
1%
2%
7%
6%
16%
• Yes
• No
• Don’t know
• Yes
• No
93%
51%
83%
The findings highlight the struggles—both short-term
and long-term—many large organizations must overcome
to ensure enterprise-wide alignment. Moreover, deeper
analysis reveals crucial differences between the perceptions
and priorities of strategy executives and their counterparts
in operations.
Feeling recessionary pressures
No discussion of corporate strategy and operations can take
place without considering the impact of the ongoing global
recession. Clearly, falling demand, financial pressures, and
organizational “rightsizing” have caused companies to
shift their strategic priorities and put additional demands
on operational departments to increase their efficiency and
manage their costs.
Nearly all corporations (93%) indicated they had updated
or revised their corporate strategies and priorities to address
current economic pressures. (Fig. 1) In addition, 83% said
that the recession had put them under additional pressure to
focus on aligning strategy and execution. (Fig. 2)
With these strategic changes in place, the question arises
of how well companies are prepared to capitalize on new
opportunities that may come about as the recovery from
the recession occurs. A little more than half of respondents
(51%) said that their organizations had an updated plan in
place to guide strategy once the economy turns around,
and 41% said they were currently working on the plan. (Fig.
3) Just 6% said there was no recovery plan in place.
Bridging alignment gaps
While the recession has put additional demands on companies to align strategy and operations, it also has created
Valero Energy: Growth Depends on Integration
business process based on that model. The third step is executing the business
The past ten years have been busy ones for Valero Energy Corp. Through a
process. There’s a lot more involved than just strategy and execution.”
carefully orchestrated series of mergers and acquisitions, Valero grew from
Valero follows a formal process for identifying and overcoming opera-
a regional company operating in only one state into North America’s largest
tional barriers that would impede enterprise strategy. “We’ve seen other
independent petroleum refiner and marketer with sales of $119 billion.
companies try to grow at this pace and fail because they don’t have the
Integrating dozens of newly acquired companies into a unified enterprise required Valero to discard some traditional beliefs about the relationship
© Copyright Forbes 2009
41%
• Yes
• Working on one
• No
• Don’t know
knowledge and the will to manage the steps between strategy and execution,” said Zesch.
between strategy and operations. “Many companies believe that strategy and
Assimilating new acquisitions quickly and efficiently is an essential
execution are separated by a single step,” said Valero CIO Hal Zesch. “In real-
part of Valero’s strategy, said Zesch. “Our rule of thumb is that it takes us
ity, there are at least three critical steps. These intermediate steps are often
three months to integrate a new company into our enterprise system,” he
overlooked because they are complicated and because the insight required
noted. “We integrate everything—every piece of equipment, every purchase
to make them work is difficult to obtain. The first step is developing a busi-
order, every sale, and every item in the warehouse. Everything and everyone
ness model based on the enterprise strategy. The second step is developing a
becomes part of one unified system in 90 days.”
3
Figure 4. What are the primary barriers that need to be overcome to align
strategy and operations within your organization:
Changing market conditions that affect strategy and operational execution
46%
43%
48%
Current economy has put added pressure on short-term costs vs. ROI
29%
20%
36%
Timely, accurate data is not available
22%
28%
18%
Operational employees do not understand strategic goals
21%
25%
18%
Risks/opportunities identified by operations not incorporated into strategy
19%
19%
20%
0%
30%
• Overall
• Strategy executives
60%
• Operations executives
Pitney Bowes: Beyond the postage meter
Long known for its ubiquitous postage meters, Pitney Bowes has transformed itself into a $6.3 billion global technology enterprise, acquiring
more than 80 separate companies in recent years. The success of this
acquisition-driven evolution is highly dependent on creating extremely
tight linkages between strategy and operations.
“We have found that operational efficiencies are enablers of strategy,” said Mike Monahan, Pitney Bowes’ chief financial officer. “For
example, our operational cost-reduction efforts make it possible for
us to invest in key strategic initiatives that improve the customer experience. In this environment, customer retention is critical, so that is a
additional gaps to overcome. In particular, sudden, unexpected shifts in customer demand have put enormous stress
on companies to manage their costs, resulting in shortterm thinking that is less focused on long-term returns
than immediate bottom-line impact. The financial pressures being felt on the front lines may, in fact, be driving a
wedge between strategy and operations.
Asked to identify the primary barriers to aligning strategy and operations, executives pointed immediately to
changing market conditions that may impact their companies’ execution, which was cited by 46% of respondents.
(Fig. 4) Second on the list was pressure on short-term costs
versus ROI caused by the current economy (29%). These
were followed by availability of timely data (22%), operational employees not understanding strategic goals (21%),
and risks and opportunities identified by operations not
being incorporated into strategy (19%).
Digging deeper into the results, there was often divergence between the barriers cited by operations and strategy
groups—discrepancies that may, in fact, be contributing
to the misalignment. Economic pressures were felt most
acutely by operations teams—36% of those who identified
themselves as operations executives felt that added pressure on managing short-term costs was a major barrier,
compared to just 20% of those who said they work in strategy who cited that point. Meanwhile, strategy was more
concerned with the availability of information—28% of
strategy executives noted the lack of timely, accurate data
as a barrier, compared to 18% of operations executives who
noted that barrier.
Additionally, as fourth and fifth items on the list demonstrate, both groups worry that their priorities aren’t
important to their counterparts. Companies may be stymied when strategic goals are not communicated effectively
to operations teams, and when the experiences of frontline operations groups are ignored by those responsible for
crafting strategy.
strategic advantage.”
Directly linking strategy and operations also enables the company to develop and test prototypes quickly and more cost-effectively,
shortening the product development cycle, and creating potential competitive advantages. “We can leverage our existing infrastructure to deliver
new products—without having to build a new business from scratch,”
said Monahan.
© Copyright Forbes 2009
Disagreements over current priorities
Gaps in perception visibly surfaced when executives were
asked to rank their current strategic priorities and their current operational priorities. While the priorities that fell into
the top five of each category were consistent, their rankings were often significantly different. In many cases, this
4
Figure 5. What strategic priorities are most crucial to your organization today?
Staying competitive in a challenging market
Figure 6. What operational priorities are most crucial to your organization
today?
Cost containment
54%
52%
56%
Increasing efficiency and performance
47%
46%
47%
Improving overall efficiency and/or performance
44%
43%
46%
46%
40%
51%
Managing and/or reducing costs
Maximizing profitability
44%
29%
40%
33%
47%
26%
Re-evaluating products/services to increase competitiveness
Identifying and addressing shifts in the competitive landscape
30%
33%
28%
23%
25%
21%
Improving financial performance
New product development
18%
19%
18%
0%
• Overall
19%
22%
16%
30%
• Strategy executives
60%
• Operations executives
further demonstrated the gap occurring between strategy’s
desire to meet the challenges of the marketplace and operations’ responsibility for containing costs.
Strategy and operations executives were in very close
agreement over their companies’ current strategic priorities.
(Fig. 5) Unsurprisingly, more than half of the respondents
chose “staying competitive in a challenging market” as their
top strategic concern, followed by increasing efficiency and
managing costs.
But the strategic initiatives often did not match their
stated operational objectives. Choosing from a separate list
of operational priorities that aligned to the strategic issues,
a separate set of goals emerged. (Fig. 6) For example, while
staying competitive was the top strategic priority today,
its operational counterpart—“identifying and addressing
shifts in the competitive landscape”—was the fourth highest operational priority, named by just 23% of respondents.
Instead, current operational priorities were clearly
focused on how companies can do more with less. The top
© Copyright Forbes 2009
0%
30%
• Overall
• Strategy executives
60%
• Operations executives
Prudential: Changing direction at a
moment’s notice
In today’s volatile economy, market conditions change so quickly that traditional planning cycles can seem outdated. “Three-year plans, annual
plans—they won’t keep you in the game,” said Steve Marenakos, a senior
vice president of annuities at financial services giant Prudential. “Market
conditions and fluctuating interest rates, for example, have forced us to
review our short and longer- range plans and make adjustments as necessary. You’ve got to act fast, and that means keeping your enterprise
strategy and operations aligned.”
The real challenge, he said, is communicating effectively with the
various business partners involved and explaining the tradeoffs in clear,
business terms so everyone understands the potential risks. “For example,
if you choose a lower-cost technology solution, you might save money in
the short term, but it could make your batch cycle run longer and run the
risk of not getting your trades completed on time,” said Marenakos. “All
of this has to be factored into your decision-making process as you strive
to achieve that balance between strategy and operations.”
5
Figure 7. What strategic priorities will be most crucial to your organization 12
months from now?
Staying competitive in a challenging market
Figure 8. What operational priorities will be most crucial to your organization
12 months from now?
Improving overall efficiency and/or performance
45%
39%
48%
47%
42%
33%
Increasing efficiency and performance
Cost containment
42%
40%
44%
37%
37%
37%
Managing and/or reducing costs
New product development
31%
31%
30%
29%
31%
27%
Improving financial performance
Maximizing profitability
31%
29%
27%
26%
35%
32%
Re-evaluating products/services to increase competitiveness
Identifying and addressing shifts in the competitive landscape
22%
23%
17%
30%
26%
0%
17%
30%
• Overall
• Strategy executives
60%
• Operations executives
West Marine: Keeping customers happy on
land and sea
West Marine, the world’s largest boating supply retailer, attributes much
of its growth from a garage-based business to a publicly traded, multi-
0%
• Overall
30%
• Strategy executives
60%
• Operations executives
two operational objectives—cost containment and improving overall efficiency and performance—are both short-term
goals driven by bottom-line stress. While this may be driven
by the global recession, it may also be setting up barriers
that are keeping full alignment from taking place.
channel retailer to providing better customer experiences than any of its
competitors. That often means shipping products direct to customers who
could be sailing anywhere in the world, and it would seem like a natural
service to ship those products to the store nearest the customer’s next
destination.
But there was a problem. The company’s processes did not support
shipping orders direct to stores.
“It seemed like a no-brainer, but we weren’t able to do it,” said
Ashlee Aldridge, West Marine’s CIO and SVP of direct sales. “Multiple
organizational units and departments are involved in the order-taking
process, and there were barriers we had to overcome. So we got all the
parties together and we blocked out a plan that didn’t require a lot of
high-end technology to make it operational. We used the technology we
already had, and we made it work.”
© Copyright Forbes 2009
Distortions also appear in future priorities
More disparities were revealed when the executives were
asked to rank what their most crucial strategic and operational priorities will be 12 months from now. This could be
an area of concern for companies looking to create greater
alignment across their organizations as they seek to capitalize on post-recession growth opportunities. In particular,
they may need to make operations teams less focused on
costs and more aware of identifying new opportunities that
may arise.
Looking ahead 12 months, the need to stay competitive
in a challenging market again topped the list of strategic priorities, although the percentage was markedly less
6
Figure 9. Regulatory issues keep us from executing effectively on our strategy.
Overall
58
25
17
Strategy
59
20
21
Operations
57
0%
28
50%
15
100%
• Agree/strongly agree
• Neither agree nor disagree/don’t know
• Disagree/strongly disagree
than chose it as a current priority. (Fig. 7) Among operations executives, however, it was actually their second
priority, slightly behind increasing efficiency and performance. Meanwhile, managing and reducing costs, a clear
priority in the recession, fell to fourth place among operations executives, cited by 30% who see it as a concern a year
from now.
Again, the need to be competitive appears to be far less
important as an operational objective, particularly with
operations executives. Identifying and addressing shifts in
the competitive landscape ranked fifth on the list of operational priorities 12 months from now. (Fig. 8) It is worth
noting that it was chosen by 17% of the operations executives, less than half as many as picked “staying competitive”
as a future strategic priority (42%).
significant impediment to the success of strategic initiatives
and operational execution as the number of global regulations
that require compliance continues to grow, and compliance
will likely require greater strategic and operational mind
share. Companies may want to manage this area more closely,
as operations groups will be under greater pressure to ensure
compliance without hindering strategic success.
Dissatisfaction over talent management
Strategic and operational excellence often depends on having the right talent in place to execute corporate goals. Yet
many executives in the Forbes Insights survey took issue
with their organization’s workforce management in areas
such as recruiting, retention and training.
More than one in five executives surveyed (22%)
said their company’s recruiting and retention efforts did
not accurately reflect current or updated strategic goals.
Furthermore, a quarter (25%) indicated that their organizations’ training and development programs didn’t align with
strategic goals. (Fig. 10)
This may not be surprising. Workforce reductions and
hiring freezes have been key elements of the cost-cutting
BlueScope Steel: Clear signals in a
turbulent market
When the global recession hit and market demand for building materials
softened, BlueScope Steel made a strategic decision to accelerate relining one of its key blast furnaces. The reline, which extends the facility’s
operational life by 20 years, together with continued investment in the
company’s flagship brands, reflected a long-term view that, despite short-
Dealing with regulatory issues
Another area of concern for companies may be how they
manage regulatory and compliance issues. Organizations
face a constant flow of new laws that impact their business
practices, particularly in areas such as finance, accounting,
and environmental impact.
In this survey, nearly six out of ten executives (58%)
strongly agreed (23%) or agreed (35%) that regulatory issues
keep them from successfully executing strategy. (Fig. 9)
But few executives cited compliance as either a strategic or
an operational priority—it was toward the bottom of the
list of both current and future concerns. Yet this may be a
© Copyright Forbes 2009
term turbulence, the market for steel products would eventually stabilize
and grow.
These decisions were shared and discussed with the steelmaker’s multiple operating units by the executive leadership team, which is
responsible for aligning strategy and operations across the enterprise.
Tania Archibald, BlueScope’s head of corporate strategy, said the “long
lead time, long payback investment decisions” sent clear signals to the
market, local communities, and stakeholders that BlueScope “was in it for
the long haul.” That clarity, she said, “provides certainty to our customers—and to our sales and manufacturing teams—over the longer term,”
enabling the company to maintain a strong competitive position in a rapidly shifting market environment.
7
Figure 10. Do your organization’s talent recruiting and retention programs
accurately reflect current or updated strategic goals?
Figure 11. Changes to risk models are immediately incorporated into revised
strategic goals.
5%
58
27
15
42
22%
• Yes
• No
• Don’t know
73%
0%
50%
100%
• Agree/strongly agree
• Neither agree nor disagree/don’t know
• Disagree/strongly disagree
Do your organization’s training and development programs accurately reflect
current or updated strategic goals?
8%
• Yes
• No
• Don’t know
25%
67%
Kelley Blue Book: Tuning up alignment
Over the past 14 years, Kelley Blue Book has transformed itself from a
regional automotive trade publisher into a well-recognized consumer
brand for vehicle valuation. The company’s expansion, driven by its
successful website, now includes e-commerce, information syndication, software development, auto dealer services, and manufacturer
consulting.
Rapid, ongoing transformation has required constant fine-tun-
measures companies have had to take through the current
recession. With staffing taking a backseat to other measures, executives are not necessarily focused on talent issues.
For example, recruiting, retaining, and training employees
ranked 12th on the list of current operational priorities and
only moved to 9th on the list for priorities in 12 months.
Yet with economic recovery, companies can expect
additional pressure to retain their most valued employees
and they will face a more competitive market for recruiting
new talent. So aligning human capital management to strategic and operational goals may be more important than
ever for future success.
ing of the alignment between strategy and operations. “We operate in
two volatile industries every day; the Internet business and the automotive industry. To maintain our stronghold in both, it is essential that we
continually align our critical business units such as sales, marketing, and
Web-based operations,” said Paul Johnson, the company’s CEO and president. “With the immense growth our company has experienced in just
the last three years alone, we put processes in place to ensure operational
alignment, which ensure both profitability and success.”
The company recently launched an online car-shopping site—“The
Trusted Marketplace”—that includes more than 1.1 million used-car
classifieds and new- and used-car inventory from 10,000 auto dealerships. “The strategy is leveraging information and extending our trust
in the marketplace through a unique business platform,” said Johnson.
Managing risk effectively
Risk management appears to be another critical area in
which executives are less certain about the capabilities of
their companies to respond effectively—another possible
gap between strategy and operations.
© Copyright Forbes 2009
“Facilitating the buying and selling of millions of cars is an enormous
undertaking that required a staff of project managers and meticulous
operational alignment. Working closely with our well-organized staff,
we were able to launch this new consumer marketplace and manage its
growth with ease.”
8
Figure 12. Does your organization use enterprise risk management tools
and/or processes to identify risks and opportunities and assess their potential
impact?
5%
21%
• Yes
• No
• Don’t know
74%
As noted earlier, executives surveyed believe a significant barrier to alignment is the fact that risks and
opportunities identified by operations are not incorporated into strategy. Yet this barrier may be an ongoing
issue for many companies. More than 40% of respondents
did not agree with the idea (were either neutral, disagreed,
or strongly disagreed) that their organizations are incorporating changes to their risk models into revised strategic
plans. (Fig. 11)
Moreover, some executives indicated their companies were not using risk management tools or processes
to identify and manage risks. (Fig. 12) This finding highlights potential alignment problems as risk issues may not
be fully considered in current strategic and operational
decisions. As companies manage through the current
economy, and as they prepare for the economic recovery,
the role of managing risk in daily and strategic decision
making is increasingly important to aligning operations
and strategy.
Conclusion: Aligning strategy and operations
Undoubtedly, differences exist between strategy and operations, and while economic volatility may be making
alignment more important, its repercussions may also be
driving a wedge between the two groups. Gaining a clearer
picture of shifting customer demand may relieve some of
this stress, while opening up additional lines of communication can ensure greater transparency between strategic
priorities and front-line risks and opportunities.
This can also be realized when companies achieve greater
clarity in strategic and operational priorities. In today’s environment, divisions can occur when operations teams are
focused on containing costs at the same time that strategic
priorities center on staying competitive. To capitalize on postrecession growth opportunities, companies may need to bring
these groups closer together by giving both strategic and frontline units a clearer view of changing market dynamics.
Companies must also be aware of other areas where
gaps can occur that impede efficient decision making.
Regulatory compliance can challenge strategic success,
but when operations teams understand and address regulations, they can execute to goals more successfully.
Acknowledgement of operational risks as part of strategic
planning is important to ensure aligned and realistic operational and strategic goals. Workforce recruitment, retention,
and training can be more closely aligned to operational
realities when transparency exists between strategic and
development priorities.
Successful alignment requires companies to have a clear
view of strategy and operations, the plans and the activities.
Only with increased visibility can businesses identify the
barriers to alignment and close the gaps that may be keeping them from competing more effectively.
Methodology
The information in this report is based on the results of a survey conducted in
Nearly three-quarters of respondents (74%) held C-level titles, including CEO,
received responses from 206 executives and decision makers at leading global
COO, CFO, and CIO. Their areas of responsibility included corporate management,
enterprises in the Americas (36%), Europe/Middle East/Africa (32%), and Asia/
corporate strategy, business operations, R&D, finance, purchasing, sales and mar-
Pacific (32%). In addition, one-on-one interviews were conducted with another
keting, human resources, and information technology.
Christiaan Rizy
Director
© Copyright Forbes 2009
ten executives at companies of this size.
June and July 2009 by Forbes Insights in association with SAP. Forbes Insights
Stuart Feil
Editorial Director
Brenna Sniderman
Survey Manager
Mike Barlow
Report Writer
9
Demographics
Company size (by revenue)
Location
15%
28%
• $500 million–$999 million
• $1 billion–$4.9 billion
• $5 billion–$9.9 billion
• $10 billion–$19.9 billion
• $20 billion+
14%
15%
32%
36%
28%
• Americas
• Europe/Middle East/Africa
• Asia/Pacific
32%
Job title
Function
CEO/president/managing director
Business operations
24%
42%
COO/head of operations
Finance
12%
24%
CFO/treasurer/comptroller
Corporate management
13%
14%
CIO/technology director
Corporate strategy
12%
9%
CMO/head of marketing
Sales and marketing
3%
3%
Other c-level executive
Information technology
10%
2%
SVP
Purchasing/procurement
4%
1%
VP/director
Human resources
17%
1%
Head of business unit
Other
1%
4%
Head of department
0%
1%
25%
50%
Manager
2%
Other
1%
0%
© Copyright Forbes 2009
25%
50%
10
Results
What strategic priorities are most crucial to your organization today?
What strategic priorities will be most crucial to your organization 12 months
from now?
Staying competitive in a challenging market
Staying competitive in a challenging market
54%
Increasing efficiency and performance
45%
Increasing efficiency and performance
44%
42%
Managing and/or reducing costs
Managing and/or reducing costs
44%
31%
Re-evaluating products/services to increase competitiveness
Improving financial performance
30%
31%
Improving financial performance
Re-evaluating products/services to increase competitiveness
18%
22%
Analyzing and managing risk across the enterprise
Fostering innovation
14%
19%
Maximizing allocation of human resources
Finding/serving/retaining customers
14%
16%
Finding/serving/retaining customers
Analyzing and managing risk across the enterprise
13%
14%
Fostering innovation
Identifying merger/acquisition opportunities
13%
14%
Promoting collaboration within company and across business partnerships
Maximizing allocation of human resources
11%
13%
Identifying merger/acquisition opportunities
Driving globalization
11%
12%
Driving globalization
Promoting collaboration within company and across business partnerships
8%
12%
Encouraging sustainability/corporate social responsibility
Encouraging sustainability/corporate social responsibility
4%
5%
Addressing regulatory challenges
Addressing regulatory challenges
3%
3%
Other
0%
1%
0%
© Copyright Forbes 2009
30%
30%
60%
60%
11
What operational priorities are most crucial to your organization today?
What operational priorities will be most crucial to your organization 12 months
from now?
Cost containment
Improving overall efficiency and/or performance
47%
39%
Improving overall efficiency and/or performance
Cost containment
46%
37%
Maximizing profitability
New product development
29%
29%
Identifying and addressing shifts in the competitive landscape
Maximizing profitability
23%
29%
New product development
Identifying and addressing shifts in the competitive landscape
19%
23%
Research & development
Research & development
18%
18%
Improving customer experience through sales, marketing, and customer service
Improving customer experience through sales, marketing, and customer service
17%
17%
Executing merger/acquisition opportunities
Internal collaboration opportunities and business partnerships
17%
16%
Expanding into global markets
Recruiting/retaining/training employees
12%
16%
Internal collaboration opportunities and business partnerships
Executing merger/acquisition opportunities
12%
14%
Incorporating risk evaluation and management into operations
Incorporating risk evaluation and management into operations
11%
13%
Recruiting/retaining/training employees
Expanding into global markets
11%
11%
Complying with applicable laws and regulations
Achieving sustainability/corporate social responsibility results
8%
6%
Achieving sustainability/corporate social responsibility results
Complying with applicable laws and regulations
4%
Other
Other
1%
1%
0%
© Copyright Forbes 2009
5%
30%
60%
0%
30%
60%
12
What are the primary barriers that need to be overcome to align strategy and
operations within your organization?
Changing market conditions that affect strategy and operational execution
Who is primarily responsible for resolving alignment issues between operations
and strategy at your organization?
CEO
46%
49%
Current economy has put added pressure on short-term costs vs. ROI
COO
29%
25%
Timely, accurate data is not available
CFO
22%
11%
Operational employees do not understand strategic goals
CIO
21%
9%
Lack of clear distinction between short- and long-term goals
Other
19%
4%
Risks/opportunities identified by operations not incorporated into strategy
19%
No one
1%
Lack of communication between front-line operations and strategy
Don’t know
17%
1%
Reporting structure is not aligned
0%
17%
30%
60%
Risks/opportunities identified by strategy not incorporated into operations
16%
Budgets cannot support operational goals
11%
Communication gaps in the supply chain
10%
Corporate and business unit goals are not aligned
9%
Regulatory issues restrict ability to align
9%
Outsourced business processes not aligned with strategy and/or operations
7%
Operational incentives are not aligned with strategic goals
7%
Other
1%
0%
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30%
60%
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