The purpose of strategic planning is not a plan. OK, the outcome is typically a plan, but that is not the purpose. When leaders and their boards place too much emphasis on the document – and often the format and verbiage – the venerated plan collapses under its own weight.
Lofty goals, too many priorities
What we see too often is an organization enamored with lofty goals and burdened with an unmanageable list of tactical priorities that have little to do with business strategy. Either the document ends up sitting on the shelf, gathering dust, or the organization becomes hopelessly mired in activities that fail to produce tangible business results. In either instance, the failure to follow through on good intentions breeds organizational cynicism.
Wants vs. needs
CEOs may say they want a strategic plan, but what they need is a strategically focused, high performing organization, capable of responding proactively to shifting market dynamics, routinely delighting customers and achieving business objectives. They also need a collaborative, capable and accountable leadership team. They need a dedicated and energized workforce. They need robust and reliable business processes and systems. They need a culture focused on winning and built on enduring principles. The purposes and motivations for strategic planning are numerous. The planning process is the vehicle to achieve these ends, not an end in itself.
A discovery process
Done right, the strategic planning process creates a “sacred space” in which perspectives can be shared, ideas debated, assumptions challenged, problems explored, and consensus achieved on future direction and business priorities. The process strengthens and coalesces the leadership team and fosters a sense of shared accountability for results.
Strategic planning provides an opportunity to step back from the pressures of day-to-day business to systematically evaluate the potential impact of external trends and developments: industry, market, customer, competitor and supply chain; and the influence of technology advancements and regulatory changes. A healthy exchange about the challenges the business faces from outside the four walls produces the sort of insight and foresight which enables leaders to:
- Uncover potential new markets and customers.
- Challenge and refine the business model.
- Clarify and strengthen competitive differentiation.
- Filter and qualify business opportunities.
- Anticipate and respond nimbly to market shifts and competitive dynamics.
- Develop a viable, market-based growth strategy.
Strategic planning is also a forum in which leaders can thoroughly assess the organization’s capabilities: structure, processes, skill sets, staffing and systems. A robust and honest self-appraisal helps the team to:
- Determine investment priorities and how to best leverage resources: time, talent and treasure.
- Focus operational improvements and integrate functional priorities.
- Align organizational behavior; improve cross-functional communication, collaboration and cooperation.
- Navigate change, increase organizational agility and accelerate business momentum.
- Strengthen customer relationships and responsiveness.
- Enhance talent and reinforce the corporate culture.
Clear priorities: strategic and operational
At its essence, strategic planning is an executive level problem-solving process. A disciplined approach addresses two fundamental questions, the first strategic and the second operational.
- What will be the future focus of business development efforts in terms of products (or services) offered and markets served? A clear consensus on specifics (what, where, how, why and when) is key to assuring everyone on the planning team is on the same page.
- Which operational/organizational competencies must be strengthened to successfully compete and win within the chosen strategy? Again, leadership consensus is critical when it comes to funding improvement priorities.
Less is more
The answers to these questions will translate to a handful of initiatives – strategic and operational – designed to have transformational impact on the business. The results achieved are far superior to those derived from a lengthy, short sighted “To Do List.” A few substantive initiatives can be managed in a dynamic context in which strategic planning becomes an ongoing leadership discipline.
The process becomes the product.
