It’s the end of summer, so as the summer travels ends you might think you will have a break from hearing "Are we there yet?". But, as fall approaches and businesses turn their attention to the budgeting process, you may here this question again, but stated differently.
At this time of year, clients report hearing some team members making a very similar exasperated inquiry:
“We are done with our strategic plan?"
"Why do we need to talk about strategy again this year?”
I get it. For many action-oriented managers, the exploratory discussions of strategy development is a painful exercise they suffer through before they get their reward: a goal. When the plan is finally compiled and approvals are given to proceed, they just want to dig in to action plans. They thrive on pulling their team together to get creative on the who, what, where, when and how. They love to debate action steps and brainstorm ideas to solve problems issues along the way. Me too; I love that phase. But what if the goal has shifted? Or worse, what if the goal has not shifted, but should have because the market is changing. Even the best action plan will produce irrelevant results in this case.
Too often managers are under the assumption that a strategic planning process is a governance requirement not a strategic management tool. They believe when it is complete, they have fulfilled this obligation and can go back to running their business or program for a few years. This is a faulty assumption and sets teams up to fail, especially in today's highly dynamic operating environment. Change is a constant and the way to win is to check in with your strategic direction regularly to confirm or modify the goals focusing your effort.
A strategic plan details the thinking at one period of time. It sets out a long-range strategic direction to establish a pathway for deeper planning. It should establish shared objectives for the executive management team and be used to track and monitor progress over time. However, the plan should be re-examined – annually and the thinking it is based on should be updated to reflect new knowledge or changes in its assumptions.
Executive teams should engage in strategy development discussions annually to:
- review the strategic plan and renew the focus of its long-range commitments,
- identify, explore and evaluate shifts in the organization and the world around it - possibly taking a deeper dive into a particular topic, area of work or market focus so implementation against long-range goals has the best possible thinking, and finally,
- reach agreement on shared objectives and priorities for each program or functional area, given this updated strategy development dialogue.
These discussions need to occur far enough in advance of the annual budgeting process so that they can set the agenda for the budgeting process.
We are living in extremely dynamic times. Change is constant and can be required at all levels of implementation. Individual teams working in isolation to achieve a goal may do well at addressing changing dynamics in the execution of their plan, but what if there is a shift that modifies the plan’s goals? If executives don’t stop, at least once a year, to examine their goals and the thinking that formed the goals they (and their teams) may waste valuable time and resources producing the wrong results.
Change demands a strategy. So, the next time you or your peers hear that you are going to spend time revisiting your strategy, don’t take that cranky tone of a bored summer teenager asking “Didn’t we do that already?” Be thankful for the time to make sure you are focusing on the right goals BEFORE you dig in to achieve them.
Does your team need help with this important step in your planning process?