Better Strategic Planning

Wednesday, October 16, 2013 - 07:38

By Leon Gettler

Managers should play a crucial role in strategic planning. For any organisation, strategic planning sets out the goals and creates the process for determining how the entity can best achieve them. Ideally, strategic planning links the organisation’s objectives to the actions and resources required to achieve them. Managers who are at the coal face, and who are the ones most exposed to those actions and resources, would play a crucial role here in helping to create that plan. Strategic planning should create a systematic process to ask and answer the most critical questions confronting a management team. And the management should know what some of those questions would be.

Ron Ashkenas at the Harvard Business Review says managers should always test their assumptions because more often than not, they are working on educated guesses. They should try short experiments to test the waters. They should also ban fuzzy language and buzz words like “Leverage our World Class Operating Capabilities” or head-scratching aspirations like “Paradigm shift” or “Reshaping Our Pricing and Trade Strategy to Effectively Drive Demand While Maintaining Market Access”. Vague language is a prop, it stops people from thinking.

Ashkenas says managers should also avoid working with rigid templates. Like fuzzy language, these templates will produce stale ideas, rote responses, and plans that don’t fully capture – or worse, they can obscure – the key issues and opportunities that a business needs to address. Managers should instead opt for a more open ended model that encourages lateral thinking. And finally, he says managers have to ask provocative questions.

He writes: “In theory, strategic planning should foster intense debates and discussions; but when the process is rigidly structured, and the documents are dense with data, the dialogue can be stilted or constrained. To overcome this, it’s important to ask tough questions when the plans are presented – and to do this in a way that can lead to unscripted answers that will enrich the thinking and increase everyone’s level of confidence in moving forward.”

What sort of questions?

Strategic planning experts say managers should ask things like what’s the vision for the company, where is it headed and what industry standing do they want to achieve in five years’ time. They have to convert the managerial statements of strategic intention into clear targets. And they have to develop strategies that will build the business, satisfy customers, outcompete competitors, respond to market conditions and achieve financial objectives.

Directions Magazine says managers need to look at several things when engaged in strategic planning.

There need to have a blueprint for action and there needs to be a SWOT analysis (Strengths, Weaknesses, Opportunities and Threats). They should also create a simple, but specific list of short-, mid- and long-term goals and develop some competitive intelligence assessing the strengths and weaknesses of the competition. Typically a strategic plan will also include analysis of potential markets the organisation should consider entering. Good plans require an honest assessment of how much money and effort will be required. The plans should also be assessing what the business is doing to develop and retain employees as well as attracting the best and brightest.