Strategy Cannot Be "Formulated Then Executed" — Transition to Agile Organizations Remains at 15%

Roland Berger (Minato-ku, Tokyo, Representative Director: Yuzuru Ohashi, hereinafter "Roland Berger") conducted the "5th Survey on Awareness of Listed Company CxOs and Heads of Corporate Planning" targeting 200 CxOs and Heads of Corporate Planning at Japanese listed companies regarding the difficulty of strategy execution in the generative AI era.

Now that generative AI has dramatically reduced the cost of "drawing" strategy, what differentiates corporate value is not the ability to draw strategy, but the ability to execute the drawn strategy and turn it into results. This series, with "strategy execution" in the generative AI era as its theme, will unravel from survey data why strategies are not executed and what differentiates organizations that can start and complete them.

1st Installment | The focus of management issues shifts from "formulation" to "execution" 2nd Installment | "Indecisive organizations" stop strategy execution 3rd Installment (This article) | The key is the transition to "agile organizations" 4th Installment | Utilizing external partners as "accelerators"

For the previous "4th Survey on Awareness of Listed Company CxOs and Heads of Corporate Planning," please click here.

There are two main points from the survey results: 1 Over 80% of companies recognize the necessity of an agile system that simultaneously formulates and executes strategy, but only 15% have actually built one, with many still in the implementation phase.

2 Agile strategy operation requires a common understanding of project objectives and priorities. However, approximately 40% of projects lack a unified understanding.

*High-performing companies in this survey are those that responded "better than competitors" regarding their company's sales growth rate compared to competitors, and underperforming companies are those that responded "worse than competitors."

1 Over 80% of companies recognize the necessity of an agile system that simultaneously formulates and executes strategy, but only 15% have actually built one, with many still in the implementation phase.

As stated in the 1st installment, with the declining cost of drawing strategy, the conventional, separated approach where "management formulates strategy and then the field executes it" is no longer sufficient to cope with environmental changes. In many cases, by the time formulation is complete, the underlying business environment has already changed. What is required here is an "agile organization." An agile organization refers to the organizational capability to continuously manage both strategy formulation and execution as a single unit, without separating them.

However, this is not simply about running formulation and execution in parallel. Its essence lies in (1) translating the formulated strategy into concrete actions at the field level, (2) identifying changes in premises and deviations from expectations during the execution process, and (3) immediately reflecting and revising them in the strategy—continuously running this cycle at high speed.

This point becomes clear when considering the difference from PoC (Proof of Concept). Since PoC aims for verification, it often ends with "trying it out," and the knowledge gained is not sufficiently connected to management decisions or resource allocation. The value of an agile organization lies not in the "speed of verification" itself, but in the ability to quickly connect learnings from verification to strategy and decision-making.

So, how can such agile organizations be built? The elements we have examined in this series can be organized as design principles. First, treat medium-term management plans not as fixed documents, but as a "bundle of hypotheses" that are continuously updated in response to environmental changes. Keeping premises unfixed and always in a verifiable state is the starting point for agile operation. Second, delegate decision-making authority appropriately so that the field can act immediately upon noticing changes, and clarify "who decides what." This prevents stagnation in decision-making and enables faster back-and-forth between strategy and execution. Third, establish a system to centrally manage important information such as objectives, decisions, and priorities, and maintain a common understanding among stakeholders.

In this article, we refer to the core document that fulfills this role as the "scripture." And to make these operational in practice, the existence of field leaders who connect management's intentions with the reality on the ground and facilitate back-and-forth between them is indispensable.

An agile organization is not a state where these elements exist individually, but a state where authority, information, and leadership are organically linked, and strategy and execution function as one.

While over 80% of management already recognize the need for agile organizations and are beginning to move towards building them, only 15% have actually responded that they have "built" them, with many companies in the implementation phase.

This gap is not merely a matter of recognition but indicates the difficulty of organizational design and operation. Agile organizations need to be redesigned as mechanisms for simultaneously running strategy and execution, including the allocation of authority, integration of information, and the nature of decision-making.

In fact, companies that have built agile organizations have about 1.4 times higher strategy completion rates than those that have not, confirming that differences in systems directly translate into results.

In an environment of rapid change, the ability to build a system that links strategy and execution without separation is a crucial condition for determining whether "drawn strategies can be turned into results."

2 Agile strategy operation requires a common understanding of project objectives and priorities. However, approximately 40% of projects lack a unified understanding.

To achieve agile strategy operation, execution, and completion, it is essential to maintain a common understanding of project objectives and priorities at all times.

However, the reality is that only a little over 10% of companies responded that "understanding has always been unified," and approximately 40% of projects are proceeding with a lack of unified understanding.

Furthermore, there is a significant difference between high-performing and underperforming companies. In the former, the response "understanding has always been unified" is about four times more frequent than in the latter, while the response "understanding has never been unified" is about ten times more frequent in the latter.

Moreover, projects with a unified understanding have a completion rate that is 16 percentage points higher than those without.

Thus, the presence or absence of a common understanding directly impacts the success or failure of strategy execution. For this purpose, a system is needed that centrally manages important information such as objectives, decisions, pending issues, and priorities, and to which stakeholders can always refer, rather than relying solely on communication.

In this article, we refer to the core document that fulfills this role as the "scripture." The "scripture" is not merely minutes of a meeting or a task management sheet, but a common foundation that clarifies the overall project scope, the history of decision-making, and the underlying issues, and which stakeholders can always refer to and update.

In reality, projects with such clearly defined documents are less than 20%, but when they exist, the degree of common understanding is confirmed to be about three times higher than when they do not exist.

In strategy execution and completion, the "scripture" is not just a means of information management, but an indispensable infrastructure for aligning the entire organization's perspective and improving the quality and speed of decision-making.

In response to the survey results, Seiichi Tamura, Senior Partner and Head of Roland Berger's Corporate Transformation Support Team, stated:

"As the shelf life of strategy shortens, the conventional timeline of 'formulating then executing' can no longer keep up with environmental changes. What is required is an agile organization that continuously updates through learning while simultaneously running strategy and execution. The starting point is to have a common foundation, the 'scripture,' to which stakeholders can always refer, and to continuously align the organization's perspective."

Yojiro Kamiya, Principal in Roland Berger's Corporate Transformation Support Team, stated:

"This survey shows that over 80% recognize the need for an agile promotion system, but only 15% have actually built one. What separates this gap is not enthusiasm, but design. It is necessary to incorporate into management a decision-making mechanism that treats medium-term management plans as hypotheses rather than fixed plans, rapidly reflects learning into strategy, and operates a 'scripture' that supports common understanding."

Survey Overview

Survey Period: May 2026

Survey Organization: Roland Berger

Survey Method: Internet Survey

Survey Target: CxOs and Heads of Corporate Planning at listed companies nationwide, male and female, aged 20-70 (CEOs and other executives, or heads/managers of corporate planning divisions)

Number of Valid Responses: 200

Corporate transformation aims to guide companies and organizations to adapt to the future, and in addition to overseeing transformation, it requires extensive expertise in the field closely related to corporate transformation, such as organization, human resources, and communication with stakeholders. Roland Berger will continue to support Japanese companies in improving corporate value on a continuous basis by utilizing all management methods.

Authors

Seiichi Tamura (Senior Partner)

Proficient in supporting corporate transformation in collaboration with management as a transformation consultant.

Responsible for investment and financing at a public-private fund, leading the turnaround and transformation of investee companies.

Experienced in business operations (former Vice President, Representative Director of JVCKENWOOD; former Senior Executive Officer of Nidec). At JVCKENWOOD, led mid-to-long-term strategy formulation and execution as CSO/CFO, and business restructuring and execution as COO. At Nidec, led the growth of acquired businesses (Europe, US, China) together with local management.

Yuki Kaneko (Senior Project Manager)

Proficient in supporting corporate transformation in collaboration with management and field members as a transformation consultant.

Graduated from Kyoto University, joined Roland Berger after working at a Japanese think tank.

Possesses experience in supporting various functional areas, including new business development and business strategy formulation/execution support, primarily in the telecommunications/IT, electronics, and manufacturing industries.

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