Companies today are not effectively executing against strategy and the business leaders know it, with 80 percent recognizing that they are not doing their best to communicate strategy through the organization, let alone execute against it, according to new research commissioned by SuccessFactors, Inc. (NASDAQ: SFSF), and Accenture (NYSE: ACN).

Business strategies are being developed and executed in some of the most uncertain times in several generations, with global power shifting from West to East, the emergence of new competitors, an ageing workforce, a growing skills gap, and social-media connectivity, according to the study.

It is essential for business leaders to align their team's work with the overall business strategy and it is clear that most don't know how to do this effectively, said Erik Berggren, vice president of customer results and global research for SuccessFactors.

SuccessFactors and Accenture commissioned independent technology market research specialists, Vanson Bourne, to conduct the research. 450 interviews were completed in September and October 2010

According to the study, business leaders who recognize potential organizational shortcomings and bridge this strategy and execution gap will emerge as the winners in the next economy.

Winning organizations will have strategic HR people up front and will have invested in systems that empower them to align their workforce through a combination of goals, targets, pay for performance, reviews and effective communication of strategy, said Vinzenz Kremer, managing director and executive partner, Accenture.

Key Research Findings:

* Enterprise organizations are failing to monitor, motivate and retain employees. Only 17 percent of organizations know all of its top performing employees and are looking to develop them for future roles.

* Two-thirds of organizations have a pay-for-performance policy, but of those, only one in five always ensures that rewards are accurately aligned to contribution.

* Only 12 percent of respondents who monitor staff goals and their execution have an IT system that delivers the information needed for goal management and execution. Nearly 40 percent of organizations are trying to measure the time to real performance, but lack the necessary data and systems to support this.

* Over the last five years, productivity has increased, with 79 percent of organizations using computerized systems to manage goal execution and productivity, compared to only 47 percent of those using a paper, email and spreadsheet based system.

* Organizations agree there is a business critical need to execute strategy, yet only 20 percent of companies claim to communicate strategy very well internally.

* Only 18 percent say they are very good at converting corporate strategy into priorities and goals. Just 15 percent are very good at aligning employee activities to corporate strategy.

* Nearly three out of four respondents whose companies use collaborative technologies, such as SuccessFactors' CubeTree, feel their organization communicates strategy well or very well, compared with 62 percent who rely on managers to cascade information.

Nyse Management