If we do not change direction, we will end up where we are headed” – Chinese Proverb
It always shocks me how many businesses do not have a structured strategic planning process. I was facing a group of well-healed executives and CEO’s at a conference, and – ironically – I was delivering a talk on strategic planning.
“Which of your companies plan on an annual basis?” I asked.
Only a quarter of my audience raised their hands.
“To those of you who don’t plan on an annual basis, why not?” I pressed.
In one way or another, they answered that they were too busy fighting fires to have time for that. This same group of executives then complained about low growth and no profits. Then they blamed the economy for their problems. With that, I suddenly understood: clearly, they were nincompoops.
These CEO’s did not make the connection that planning helps you deal with the economy and the issues that challenge your business. As an intervention and a way to discipline this misguided group of executives, I readied my pointed stick dipped in monkey dung. (Please note it was organic monkey dung because, after all, CEO’s and executives expect the best.)
Before we go further, let’s define what we mean by strategic guessing/planning. Rework, a book written by successful software entrepreneurs Jason Fried and David Heinemeier Hansson, declares that planning has been replaced by guessing. There is something to this. The past two years have presented a very uncertain climate for most businesses. If guessing has become as good as it gets, then you absolutely need a process by which to look at the future and make educated and measured calculations about creating a bright organizational future. However, while tactics are a part of this process, strategic guessing/planning is more interested in the strategy and future moves that the company will take to achieve its health and growth.
The fact is that many small-to-midsize companies do not have a structured process from which to conduct strategic planning. This is like many adults who do not exercise, despite knowing it’s good for them. Perfect health isn’t guaranteed by regular exercise, but the likelihood of attaining good health is dramatically increased. Strategic breakthrough business guessing/planning work for businesses in much the same way as exercise works for the individual.
Your Company has a future, right?
In my 30 years of conducting planning processes, I have never seen a healthy company maintain long-term growth without ongoing strategic planning. Planning is about growing and improving your company. When you don’t plan, at best you get maintenance of the status quo. At worst, you ignore problems and challenges that will significantly damage or even destroy your organization.
The time has now come to present a streamlined list of my company’s most critical rules for strategic guessing/planning. There are only 120 of then. So, music please! What? Okay! Take it easy! (You get overwhelmed so easily.) We will go over just seven rules of planning. Is that better?
Rule Number One
The first rule is always pick the right team for planning. This poses the important question of who should be part of the planning team. It is crucial that planning team members are people who are committed to and can add value to the conversation about the company’s growth. The only exception is if there are key employees or managers you want to develop. If you want them to better understand the strategic issues facing the company, it might make sense for them to be a part of the process.
In addition, you can have members of the planning team who are outside the leadership group. These could be salespeople and other key employees. It is important that you vet them and ensure that they are of the quality and stature required for being a part of the planning group. It is also important that they are getting their jobs done and are employees of stellar standing within the company.
A number of times over the years, I have seen the wrong leaders and key employees involved in planning. Their participation actually hurt the effort. Take Carlos, a promising customer service representative. Because of his gung ho spirit, he was selected to be part of the strategic planning team. Then he abruptly left his company in the middle of the year.
Upon his departure, his boss discovered that the beloved Carlos had left a host of problems. Carlos had not been returning customers’ calls. In fact, lots of work around Carlos’s customers was not getting done, despite how, in the planning session, Carlos had taken on being a “Champion” in working to improve customer service.
Example number two: An HR Manager was naturally included at a manufacturing plant’s planning sessions. After the planning sessions, she took employees into her office and gossiped about managers. Then she, too, left. (Thank goodness.) After her departure, the plant’s CEO added Lucinda to the team. She was young, energetic, knowledgeable, and had a clear vision of what the company could be. Her role was completely different than the first HR Manager’s was. Lucinda’s addition to the planning team was constructive and positive.
The message here is to pick wisely and selectively. Members of the planning team must be able to maintain complete confidentiality and be fully engaged in the growth and well-being of the company. Select employees who are passionate about growing the company, developing an extraordinary organization, and, essentially, being the CEO’s partner. Don’t accept mediocrity or include people in the planning process simply because of their positions.
Rule Number Two
The second golden rule of planning is to make sure the design of the planning is one that will yield a good result. I am not a believer in leadership teams locking themselves in a room at a resort for two or three days. This type of planning may be sprinkled with some golfing, gambling, or other “fun stuff”. From this design, a strategic plan is supposedly born and created.
The problem with this design is that it curtails critical thinking. This process begins to smell of Plan-In-Binder Syndrome, which is exactly what it sounds like: the leadership group ends up developing a “plan” that then ends up securely contained in a nice plastic binder that is then lost and forgotten. These binders tend to become nestled in the executive bookcases. After the year begins and the fires start raging, no one looks at the plan. Poke me in the eye with a hot stick; Plan-In-Binder Syndrome is such a waste of time and resources. In addition, if you do all your planning during one session, you risk just doing more of what you are currently doing. There is no opportunity for research or involving others within the organization who are not at the planning session. I find that these plans run the risk of superficiality and being UN-implementable. Is that a word?
Here is what to do. The process should take place over two to three months and take three of four days. It is predicated on white papers and dialogue. Listening and understanding are critical. Better research ensures better debate and thinking. “What is a white paper?” you ask hysterically. “Hang tough,” I say. That is covered in rule five.
Rule Number Three
For the third amazing rule, it is important that you complete the previous year. A powerful completion process will allow you to put that year behind you as you welcome a new one. It’s important for the organization to distinguish that, indeed, there was a previous year and discuss what occurred during that time, good and bad.
At the very first session of the planning process, the past goes into the past. When I coach these sessions, the previous year’s information goes up on flip charts. The group puts items into a number of categories, such as BREAKDOWNS FOR THE YEAR, BREAKTHROUGHS, FIASCO’S, DISAPPOINTMENTS, ACCOMPLISHMENTS, and the like.
One of the great aspects of this exercise is that the executives and key employees of the organization get to review all the work that was accomplished during the past 12 months. What aspects of this year are we taking into the next? What aspects are we leaving behind? It’s all included on the flip charts and brings completion to the year. One season completes and the next opens up. I love this metaphor. Excuse me while I get a little weepy.
As a grand finale, participants stand up and say farewell to the previous year. Tears flow. Hugs and sobbing ensue. The planning team then greets the coming year with cheers, applause, hurrahs and gales of laughter. Okay – maybe not. However, this exercise is worthwhile and useful. Everyone is now ready to invent the organization’s future.
More to come……