Aligning Strategy with Performance Management


There is a view shared by Executives that “strategy is still locked in the cupboard and treated like a closely guarded secret”. Unfortunately, for many strategy is still being treated as an annual tick-box activity, treated as a secret never to be shared, and frequently poorly communicated to the organisation. Whilst the first success factor for strategy execution is leadership, the second and third are Communication! And Communication!

There are impacting contributors that lead to this situation, for instance having a strategy developed by a small team and not created and owned by the leadership team. Frequently, insufficient time is set aside to formulate sufficient granularity to make a difference. These factors are compounded by executive teams that are being disempowered, lack the levers for success and consequently never truly believe in the direction that the organisation is taking.

The consequences of this are catastrophic for all companies, particularly those looking to mobilise management teams and staff to achieve outstanding growth performance. However, these challenges can be overcome, and the first step of a growth journey must be a simple, visible strategy which generates tools and targets to ignite the enthusiasm of the organisation. Once defined, the strategy should be shared with the orgainsastion to be lived by everyone.

Key to creating a sustainable strategy that can be executed is aligning it with all aspects of the business. Further, to ensure that it becomes part of the company’s culture, strategy should be aligned to performance management. New research from the Performance Factory, and thought leadership from Jeroen de Flander, describes seven trends that are shaping the performance management cycle in 2020, ultimately linking this to the strategy of the business:

  1. Increasing the frequency of performance management cycles, aligning to the fast-paced nature of business, and ensuring that performance management cycles and goal setting activities adapt as business objectives change
  2. Simplifying the performance management cycle, focusing on what really matters
  3. Setting individual development goals for all employees, which are matched to the business goals of the organisation
  4. Using a performance coaching model as a leadership style, and using performance appraisals as a tool in a larger performance management system
  5. Setting goals outside of the traditional classroom-based approach, using online platforms and e-learning tools, and doing so in shorter sessions
  6. Focusing on the link with strategy, ensuring that individual goals are aligned with the company’s strategy
  7. Changing the way that the quality of the individual goal setting cycle is measured, ensuring that the right aspects are considered that truly add value to the business

Performance management is critical for successful strategy execution, and these should be managed hand-in-hand. Leaders and companies that are adapting to these trends, and developing relevant, all-encompassing strategies are seeing the results.

Article by Paul Connolly, Director of Strategy & Digital Transformation and Danielle Oliveira, Senior Consultant, MAC Consulting.

For enquiries or to discuss this article further contact Paul Connolly on