Strategic Planning

The strategic plan is a vision and roadmap to future success only to the extent that it is:

• Founded upon a rational vision.
• The requirements of achieving the vision are available or can be put in place.
• Impediments to the goal are anticipated and dealt with.
• The plan is flexible enough to respond to a changing environment.
• The organization responsible for making it happens knows what the plan is, believes in the plan and is motivated to make it happen.

The alignment of these fundamental requirements seldom happens.  To a very real extent, that is what separates successful companies from those that are not so successful.  Dumb luck occurs with surprising frequency, however, a well thought out plan coupled with effective management and implementation has a far greater chance of success.

There are too many authors of strategic planning methodology to count.  Some are excellent tools in effectively addressing the fundamental building blocks of a rational goal and the path to get there.  Many are marginal compilations of the buzz words of the day by individuals with no apparent practical experience, but with a great desire to make money selling books in an ever popular subject.  The common elements of the better methodologies are discussed in our article The Plan.

While a sound methodology is imperative to construct a good plan, nothing will compensate for the lack of good business judgment and an engaged organization.  This is not to say that Strategic Planning is a democratic process requiring the involvement of many layers of the organization.  Quite to the contrary, that is a recipe for failure.  Management must take responsibility for the plan and draw from the best and the brightest of organization at any level to construct it.  Inviting large numbers of people to become involved in the process creates problems not easily overcome such as:

• The resulting strategy would have to appeal and be understood by the weakest link.  Group efforts dilute the thinking of the best minds.
• Group efforts tend to place equal importance on all aspects of a business to keep the participants happy, while in reality, that is seldom the case.
• Intentional or unintentional sabotage by those whose ideas did not make it into the plan.
• All industries enjoy a certain degree of incest with the movement of employees with an industry.  Plans must be explained, but the details need not be known by all.
• Managers are responsible for and are most often incentivized on the success of the company.  Strategic Planning is not the time to delegate.

With a management team or possibly just the owner in some organizations, committed to creating a strategic plan one of the first decisions to be made is to go it alone or use a consultant as a facilitator in the process.  In large organizations, this is often not necessary.  Corporate staff has usually already worked with a large consulting company and developed a process to guide all reporting units through an annual strategic planning cycle.  Input and guidance is usually more available than local management would like and in many cases, the strategic plan has been preordained for local management’s write off. 

Small and medium sized businesses have often never created a strategic plan and are starting from scratch.  Some or all of the components of developing a sound plan may be absent:

• A process or methodology for developing a plan.
• Individual(s) capable of separating themselves from the day-to-day business issues and look at the business in the context of a longer timeframe.
• Individual(s) with the business experience to recognize common issues and draw from similar situations to add a broader perspective to the process.
• Individual(s) capable of translating high level plans into action/implementation plans and financial scenarios.
• A neutral party that can draw out the thoughts of all involved, keep a group focused and committed to an objective.
• A party that can help communicate the plan and sometimes legitimize a plan to a skeptical organization.