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In business, mistakes are always going to happen. It’s inevitable. But if you can get a handle on the most common mistakes that people make when creating a strategic plan, then at least you know what you’re up against and can prepare for it!
A strategic plan outlines a company’s vision for the future and what differentiates it from others. It sets priorities, focuses resources, and ensures an organization is working toward a common goal. While plans change constantly, the planning process is relatively static. A formal planning process prioritizes improvement efforts, assigns accountability, and proactively mitigates risks and threats. Every company has some sort of plan to survive and thrive – even if it’s just a twinkling in the leader’s eye. But not every company has a system to communicate, monitor, and continuously improve their strategy.
Eventually, a successful company is going to decide that they should extract that plan from the leadership, align management to ensure they have the same ideas, and get those ideas into an easily shareable format, like maybe a slide deck. Yes, slide deck. Go ahead and mock. The dreaded slide deck that will get “dusty on the shelf” because no one looks at it again. But it doesn’t have to be that way. For the best companies, it’s not that way at all. They’ve figured out the common strategic planning fails and how to fix them.
Booking a date and getting the right people in the room is tricky. It’s also not enough. Successful planning requires, well, planning. Without a proven process, leadership teams find themselves discussing the same topics over and over or selecting too many “priorities” to be able to focus on any one well.
Solution: Formal Planning Process
Your strategy should be unique, but you can uncover and execute that strategy through well-worn paths made by many business titans before you. Check out Jim Collins, Gino Wickman, Patrick Lencioni, and Verne Harnish. They’ve packaged their thinking in books and sold them to hundreds of millions. There are nuanced differences between their frameworks, particularly in the language used, but they’re pretty similar and you can’t go wrong with any of them. If you don’t know where to start, start there. Or give us a call.
Some leadership teams just show up and lean on the process to do the work. The problem is they end up with an uninformed strategy. At best, they haven’t prepared enough in advance to have the information they need to make decisions in their planning sessions which leads to another meeting to discuss the same issues once the research has been completed. In the worst cases, without rigorous investigation of market conditions, competitors, and internal performance metrics, leaders can make serious, business-ending choices like entering the wrong segment or charging too much or too little for their products.
All participants should be informed of the agenda in advance so they can perform their own research and come to planning prepared with the information they need to make decisions. Even better, a set of questions should be given to everyone as part of a prework package that allows for rigorous, focused debate around key strategic topics to occur in session. Employees and clients should be surveyed to gather their perspectives and internal performance data (e.g., financial reports) should be shared for the best decision making.
Why do strategic planning slide decks end up gathering dust on a shelf? Because they weren’t accompanied with an implementation plan. A great plan not executed isn’t worth its printed pixels. This manifests as, “We just talk about the same things over and over, but no one does anything about it.”
If you’re making the significant investment of pulling all the senior people together to plan, surely investing a bit more to ensure the plan is executed is money well spent. Don’t trip over dollars to save nickels. Ensure your planning process includes execution to reap the full rewards. This should include a detailed action log outlining the “who, what, and when” of the plan, which can then be referred back to in subsequent meetings. Business leaders must devote a portion of their work time to “working on the business.” What do they do during this time? Usually the strategic stuff. While many of the strategic tasks can be outsourced, someone still needs to be managing the outcomes.
Whatever strategy is chosen, there needs to be a way to define if it was achieved. Too often, strategic planning can devolve into an exercise of watered-down decision-making by committee and wordsmithing. A great strategy has milestones and measurable targets. One of the questions every planning team must answer is, “How will you know if it worked?” If you don’t have a way to measure if your strategy worked (and milestones to chart progress along the way), you won’t know if it needs tweaking or not. Plus, this can make it difficult to show ROI on the time spent planning.
Solution: SMART Goals
You’ve heard of this acronym for a reason. Make your strategy specific, measurable, actionable, relevant and time bound. Using all five steps ensures that the strategy and associated goals are defined enough to execute and track progress against.
Lack of process means someone needs to think about what comes next, instead of leaning on habit. An uninformed plan may lead us astray. No time to execute means even the best laid plans may become stale dated. No measurement of progress provides no signposts as to whether the plan is working or not. All or any of these fails lead to our final fail – no room to pivot. Business is moving faster than Omicron these days. You always need to know where you’re at and be nimble enough to recognize a sunk cost and move on.
A strategic planning process doesn’t have to be rigid, but it should include key steps like gathering data, developing hypotheses, testing the hypotheses, and course correcting when needed. This will help keep everyone on track and ensure that your strategy is actually moving the company in the right direction.
We’d argue that any sort of plan is better than no plan. At least there’s something set that can be adjusted. The danger of a poor plan, though, is that without a system in place that allows for adjustment, the company can careen wildly out of control. It can lead stakeholders to falsely conclude that strategic planning just doesn’t work rather than that the plan was poor. We don’t want to inoculate people against strategic planning!
Bellrock is a management consulting and change management firm where remarkable is expected. Our purpose is to lead people through transformational change that enables them to achieve their goals and realize their dreams. We do this because we believe in the potential of our clients to achieve more, much more, and that work can positively impact peoples’ lives. When our clients succeed, we experience deep satisfaction.
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