Research - 05.11.2014 - 00:00 

Focus on implementation needed

The HSG and Roland Berger Strategy Consultants have surveyed chief strategists in 160 companies from various industries. The resources allocated to strategy departments are becoming increasingly scarcer although strategic development is considered to be a driver for success.


10. November 2014. In a world of permanent change where geopolitical factors strongly impact the economic context, companies need to be in a position to review and adapt their strategy and business model. For two thirds of firms, transformation is therefore the normal state of affairs as they endeavor to do business successfully; 90 percent of companies have an in-house strategy department these days.

This is one of the findings of the latest study, "The strategist's change – How successful CSOs transform their companies" by Roland Berger Strategy Consultants and the University of St. Gallen. The study is based on an extensive survey of 160 CSOs from European companies across a range of industries.

Major transformation processes and resource shortages

The Chief Strategy Officer has become established as an important member of the top management team in most companies as they strive to efficiently drive this permanent process of transformation. "CSOs enjoy increasingly high status in companies across all industries," explains Roland Berger Partner Tim Zimmermann. "They report direct to their company's management and stand ready to advise them on shaping the future of their company."

But even though the role of CSOs is growing in importance all the time, they are faced with increasing resource shortages – both financial and human. "Tasked with devising and implementing the right strategy for their firm, the chief strategist needs sufficient resources to be able to install a dedicated team," explains Prof. Markus Menz from the Institute of Management at the University of St. Gallen.

Yet the reality on the ground is often different, with companies across Germany, Switzerland and Austria now having even fewer full-time employees in their strategy departments than they had three years ago. "The widely held notion of bloated strategy departments is a myth in most companies," says Prof. Menz. However, the study did show up some discrepancies between industries: While financial services companies and biotech, pharmaceuticals and chemicals firms do have much larger strategy departments, players in the service industry and in consumer goods and retail are considerably smaller in that regard.

Stronger focus on implementation needed

The personal dedication of the CSO is just as crucial to the ultimate success of a corporate strategy when it comes to actually implementing the strategy itself. "Those who concern themselves mostly with new ideas and concepts and do not lead the implementation efforts themselves will have a much lower level of success," comments Roland Berger-Partner Tim Zimmermann. "This is because strategy teams are considerably more successful when they are responsible for implementing their strategies themselves, when they steer the process and measure its ultimate success."

That said, only one third of the surveyed firms actually does that when putting new strategies into practice. In most cases, CSOs prefer to stick to their advisory function in the belief that this improves their chances of being promoted. "A fundamental paradigm shift needs to take place there – for the good of the companies themselves," recommends Prof. Markus Menz from the University of St. Gallen. He goes on to conclude: "Strategists who have a hand in shaping the overall process should be given greater recognition, in that it's the strength of their dedication to realizing the corporate strategy within the organization that often guarantees greater success."

Picture: Photocase / Kallejipp

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