Achieving Business Excellence with John Spence

6 Keys to Effective Strategic Planning

mini-peepsI am currently preparing to facilitate three strategic planning meetings, for an association, a technology company and a Fortune 100 client. Here are a few things that I see as foundational for creating an effective strategic plan.

  1. The key to a successful strategic plan is: FOCUS. Every company, regardless of size, has limited resources and strategy is all about effectively deploying an organization’s resources where they will have the most positive impact in the marketplace.
  2. To mirror my first point, one of the most important things a great strategic thinker does is figure out what to say “NO” to. What markets will we not compete in? What products or services should we not try to sell? What current projects should we abandon?
  3. If you have 10 strategic objectives, you do not have a strategy. All of the successful companies I’ve worked with were able to focus in on 3 to 5 major strategic initiatives. Anything more than that causes a lack of focus and ultimately a lack of success.
  4. When examining business issues, are you trying to solve a puzzle or a mystery? With enough data and information, you can find the right answer to a puzzle, but no matter how hard you try it is impossible to find the exact right solution for mystery. Because of this, as much as I hate to admit it, a large part of strategy is simply an educated guess about what might happen in the future.
  5. Alignment is critical. If the senior team is not 100% committed to strategic direction of the organization, the plan will fail.
  6. It’s an age-old business cliché, because it is correct: What gets measured gets done. A major reason that many strategies are not effectively executed is because there is no way to determine exactly what the expectations are. Ambiguity Breeds Mediocrity.

Those are just a few of the key ideas I try to help my clients keep in mind as we move through a strategic planning retreat. I will also add one more critical point; to make sure you follow through and implement your plan, you should spend just as much time on strategic execution planning as you do on planning the strategy. This is a very important idea that few companies truly embrace.

What are your thoughts?

Comments

  1. My thoughts are that I’m in complete agreement. Any resources you allocate to a less than ideal client are resources you cannot allocate to an ideal client. And once you’re clear on where you’re going to focus those resources, do it in the most effective way possible. That means 100% commitment by the senior team, as you mentioned, and measuring, which is something I need to work on.

  2. David Murphy says:

    “When examining business issues, are you trying to solve a puzzle or a mystery? With enough data and information, you can find the right answer to a puzzle, but no matter how hard you try it is impossible to find the exact right solution for mystery.” I had never thought about this distinction. Thanks for a fresh thought!

  3. Good share, John.
    This is all reasonable, and easy to follow.
    Thanks again for sharing your ideas with us!

  4. John, I couldn’t agree with you more. Saying ‘No’ to what looks like opportunity is tough, especially if it inside the realm of what is expected of a company of type.
    I have based my companies position on saying ‘Yes’ to our best customers as frequent as possible. My management team and I wrestle with certain things from time to time as to how far we get outside our general practice lines to appease.

  5. Spending just as much time on strategic execution planning is indeed the key. Having the plan is great. Finding out how to make it work with detailed instructions, directions and expectations (its a process) which all involved can relate to or connect with will help hit the mark. It is easier said than done and maybe the hardest part.

  6. With my clients, who are not as sophisticated or educated as John’s clients, I often have more than the maximum 5 strategies. However, if you look closely at the extra strategies, you will find they are educational strategies designed to get the manager who own that ‘strategy’ to improve the quality of their strategic intelligence. It’s a long game where I am positioning the organisation that is one to two years time, we can be more powerful in our strategic thinking. For example, I recently had a client whose HR Manager had no idea on current workforce statistics for her organisation and no idea what I meant when I said statements like, ‘the rise of the contingent workforce’. So the ‘strategy’ I set for her was all about setting that baseline of information and educating herself on the other trends out there.

  7. Barry Hall says:

    As usual John great post and information. Thanks for sharing and keep up the great work. – Barry.

  8. I have a student first mentality and it’s always great to take in knowledge. I definitely appreciate all the value you provide on your blog and along this entrepreneurial journey I understand I need to apply it. Once again thanks John.

  9. Good article John. Another key point to add is how effective strategic planning should also always include a point as to where you evaluate and re-shuffle the plan depending on how it is going.

  10. Alignment is key. Understanding FOCUS (#1), when to say NO (#2), prioritizing (#3)*, and intuitional GUT (#4) requires appealing to the Objectives of the project, program, business, unit, and enterprise (https://wp.me/p7dBI9-Kp). When analyzing, the precise question begins with “To what extent does ‘x’ support ‘y’?” (https://wp.me/p7dBI9-9R) *NOTE OF CAUTION: Prioritizing objectives presents a significant challenge because they are typically not independent variables.