If you own or lead a successful company, here are six tips for improving your strategic action planning success. Most successful CEOs and business owners agree that having an effective strategic planning process is a major contributor to success, if not the driver of scale and sustainability barring acts of God.
It’s also true that great strategic plans happen with careful consideration. The strategic planning process serves as an essential stepping-stone for your company, allowing you to set priorities, make important decisions regarding investment, and chart long-term plans for growth. Unfortunately, the strategic planning process can quickly devolve into too many actions, too little follow-up, overcomplicated budgets or verbose analyses and presentations – they may have the right jargon, but they lack a plan of action that your company can set in motion. For many companies, strategic plans become little more than wall decorations for the corporate office, or, worse, documents that get lost in the company cloud.
If your company is preparing to delve into strategic planning this season, take a hard look at your current process and whether you’re guilty of the bad habits common in planning for the future. Then, take actionable steps to improve your strategic action planning by following these tips.
This seems like an obvious tip, but the process of creating strategic plans has become so data-driven and formulaic that the root of strategic planning – anticipating the company’s biggest challenges and highlighting trends that will prove integral to the company’s success – has devolved from its original purpose. Financial forecasting and budgets have effectively replaced critical thinking. To bring quality back to the strategic planning process, complement the data and financial information (undoubtedly important aspects of the process) with a focus on the issues.
At the onset, take some time to identify the issue that will have an impact on your future business performance – a so-called SWOT analysis (Strengths, Weaknesses, Opportunities, Threats). Rather than throwing numbers on the table, frame your strategic planning sessions in a way that facilitates discussions about the key issues your company faces. Follow those issues with specific actions that align with the direction your company wants to take. By complementing your objective data with open-ended discussion points, your resulting plan will be much more comprehensive.
One of the biggest mistakes that companies make when developing their strategic plans is by starting from the inside and working their way out. However, when you start addressing the problem internally, you may only see the closest “symptoms” that are indicative of a larger issue that you need to resolve. On the other hand, by looking at changes in the external environment, you can begin to create the foundation for a successful strategic planning session.
A strategic plan will, by definition, involve making hypotheses that your company outcomes (increased revenue or a higher return on investment, for example) will rely on taking pre-determined actions. However, one of the biggest mistakes that companies make is supporting hypotheses with secondary research or assumptions.
When creating your overarching strategy, rely on the information you know – such as field tests – to drive your plan forward. When you have proprietary information from which to work from, the C-suite will be more willing to commit resources and time to the initiatives that drive business success. Some companies refer to these field tests as “scouting missions.” By including short, specific “experiments” as part of your strategic plan, your company will be better aligned to fulfill the objectives of the plan for meaningful business growth.
Anyone who has sat in a strategic planning session is familiar with the jargon and fluffy language that the process can entail. Too often, companies fall into the trap of providing a lot of words without meaningful impact. For example, phrases like “leverage,” “synergy,” “world-class,” and “harvesting efficiency” all communicate one thing: that the team does not have a clear idea what it takes to create a meaningful roadmap to change. Opt for clear language that communicates what it takes to succeed – without obfuscating phrases or jargon.
Another common appearance in the planning room is the template. When templates function at their best, they encourage strategic planning teams to consider topics such as external markets, performance gaps, and direct competition, while comparing data for each. On the other hand, the nature of using a template – with its rigid, formulaic structure – keeps teams from thinking about innovative ways for growing the business. When the strategic planning team completes the same template each year, it often leads to formulaic responses without addressing the real, dynamic issues that a growing business encounters.
Choosing an open-ended format can take the hum-drum out of your strategic planning and encourage teams to think critically while developing meaningful growth plans. For example, a narrative structure gives your team more room to develop innovative growth strategies that develop into action.
Another downside of the template is that it can discourage probing discussions or provocative questions; though this is a common mistake that businesses make even in the absence of one. For example, it makes sense that all strategic planning decisions should be data-driven; but certain aspects of the process can also constrain or stilt the conversation. For example, team members may falter when faced with a rigid structure or dense company data, necessitating a moderator who can ask the tough questions. Open-ended, probing discussion points will help enrich thinking and help participants break from the rote mentality. For example:
Tackling the most common mistakes inherent in strategic planning requires revisiting the fundamentals of the process. Take a step back from the formulaic negotiations that result in stolid, rote responses and uninspired roadmaps. Encourage meaningful discussion by asking provocative questions and breaking free of templates, but still use objective data and form a hypothesis based on actual business experience, not secondary sources.
Frame your discussion by taking a holistic view of the issues your company faces, both externally and internally. Use your insights to create a flexible charter that maps out your business goals and objectives. By following these steps, you can effectively improve your strategic planning sessions and create a document that leads to meaningful change, not just a C-suite wall decoration.
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