The Five Deadly Sins of Strategic Planning
It’s that time of year again – changing leaves, chill in the air – must be strategic planning season! After decades of working with organizations to develop strategic plans, we have seen our fair share of success and failure. The question is – what are the common pitfalls to be on the lookout for as you embark upon this journey? While every organization is different, and some of these may not apply to you, we hope that this may help you achieve the results you desire from your next strategic plan.
Issue #1 – Not engaging the right people throughout
All too often strategic plans are developed in a silo – the Chief Strategy Officer or a team tasked with this job will develop the multi-year strategic plan and assume that because it’s their job they should drive most of its development. Then, when the plan is done, they declare “victory” and throw it over the wall to the business units to go off and execute.
In reality, the opposite approach is generally the most successful. A collaborative and iterative approach between a central group, who brings strategy development best practice and can coalesce the inputs, and business and support units which each bring their own content expertise.
Issue #2 – Over or under-reliance on external resources
This may seem self-serving, but hear us out. Consultants / outside resources are a helpful aid in strategic planning efforts due to their ability to be a neutral third-party facilitator to bring together disparate ideas about where the organization should go, bring strategy development best practices, and serve as “surge capacity” when a constant capability in this area may not be needed. But over-reliance on outside resources can also be a problem, as many organizations take their recommendations as gospel without making it their own. Organizations need to struggle with the strategy development process and the implications on the organization to make it real for them. Without incorporating the deep understanding that you have of your organization, you can end up with a set of recommendations that don’t make sense for, or to, your organization and that will ultimately stand a poor chance of execution.
As you go about your planning process, working with a knowledgeable and experienced third party, ask yourself: “can I see us actually executing on this idea?” If the answer is no, push back!
Issue #3 – Inside out vs. outside in
A good strategic planning process takes advantage of, and neutralizes the threats from, the external environment. Without a robust set of data points (e.g., shifting customer needs, technology trends, competitive threats, etc.), a strategy is apt to be gut feel vs. data-driven. Now, this isn’t to say that you should expect to have perfect data to make decisions about your strategy – as you will rarely, if ever, have it. Instead, seek a balance between attainable data to drive good decisions, and comfort in making decisions with imperfect data. This is a core function of the leadership team – to review the best information you can with diverse set of stakeholders and decide upon a direction everybody can commit to.
Issue #4 – Disconnected from other core processes
All too often, organizations will regard strategic planning as a standalone process, something to be contended with once every few years, and then it’s back to real work. In reality, for a strategic plan to succeed, it must be connected to the other key operational processes in the organization. For example:
The budgeting process – as the saying goes – if your strategy and your budget are not aligned, the budget always wins.
The individual performance management process – if people’s individual goals are not aligned to the strategy, it will always just be words on a page.
The workforce planning process – any strategy is change, and with that new capabilities are required – are you hiring for those capabilities?
The risk management process – with any change, there are inherent risks. Do you know what the risks are in your strategy, and what you’re going to do to monitor and mitigate them?
Issue #5 – No clear plan for putting it into action
How many strategic plans end up as vague language littering boardroom shelves vs. being turned into real impactful change in an organization? How do you stop your plan from ending up on this mahogany cemetery? The heart of a good strategic planning process is dis-aggregating the big ideas of a strategy into the bite size ideas that can drive it forward today. Tools like driver-based modeling can help break issues down to make them more tactical and immediate-term, going from “innovate new products” to “research new design for the pumpkin spice latte cup”. Okay, maybe not that specific, but you get the idea.
Conclusion
So, what do you see as the biggest pitfalls in strategic planning? Which are you most concerned about in your organization? How will you overcome them? We hope that this article will illuminate the road ahead as you make plans for a brighter future and bring them into reality.
Here at Geigsen, we pride ourselves on being teachers, guides, advisors, and friends to our clients. If you want to discuss any of your strategy and execution related questions, we’re HERE.