BRIDGING THE GAP BETWEEN STRATEGY AND EXECUTION: AN EMPIRICAL STUDY OF PERFORMANCE MANAGEMENT SYSTEMS

Abstract

In the dynamic landscape of contemporary organizations, a persistent and critical challenge lies in effectively translating strategic intent into operational reality. This research paper, titled “Bridging the Gap between Strategy and Execution: An Empirical Study of Performance Management Systems,” investigates the pivotal role of performance management systems (PMS) as instruments that connect high-level strategic goals with day-to-day execution. While strategy formulation has often received significant academic and managerial attention, the mechanisms through which these strategies are successfully operationalized remain underexplored, often leading to strategic drift, misalignment, and underperformance. This study seeks to address this gap by empirically analyzing the structural, behavioral, and technological enablers embedded within PMS frameworks that facilitate strategic execution. Drawing on a multi-industry sample of organizations across sectors such as manufacturing, services, and technology, the research employs both quantitative survey data and qualitative case interviews to examine how well-designed PMS components, including goal cascading, real-time feedback, KPI alignment, and incentive mechanisms, can foster a culture of accountability, adaptability, and continuous improvement. Particular emphasis is placed on understanding how organizational leadership, middle management, and frontline employees interpret and act upon strategic objectives when mediated through PMS tools. The study also explores the impact of contextual factors such as organizational size, digital maturity, and cultural orientation on the effectiveness of strategy execution via PMS. Findings indicate that organizations with integrated and transparent PMS frameworks exhibit higher strategic coherence, improved cross-functional coordination, and more agile decision-making. Moreover, systems that incorporate real-time analytics, forward-looking metrics, and iterative feedback loops demonstrate a superior capacity to adjust course in dynamic environments without deviating from core strategic priorities. Conversely, the study reveals that misaligned or overly rigid PMS designs often result in disengagement, short-termism, and strategic misfires, highlighting the critical need for systems that are both structured and flexible. This research contributes to the strategic management literature by providing empirical evidence of how PMS can serve as the connective tissue between strategy and execution. It offers practical insights for executives, performance architects, and policymakers seeking to close the persistent strategy-execution gap through thoughtful system design and organizational alignment. In doing so, it repositions performance management not merely as a control mechanism, but as a strategic enabler essential to sustained organizational success in a volatile and competitive environment.