Let’s consider five reasons why you should invest in strategic planning.
- The Promise of Long-Term Sustainability
- Helps your people
- Provides a touchstone for on-going decision-making
- Better allocation of resources
- It gets everyone off the bus
1. The Promise of Long-Term Sustainability
An effective strategic plan will assist your organization to manage the complex and competing demands you face and to create an organization that will meet your customers’ and owners’ needs over the long-term. A strategic plan or strategic framework will set out how we will provide value to your customers, which means providing products and services they want. It also means having a sustainable business model to create, deliver and capture that value.
2. Helps your people
One of the decisive benefits of strategic planning will be the reduction of uncertainty. Your employees need certainty about the purpose of their work, the expected accomplishments and their role in achieving them.
A good strategic plan provides exactly what your people need. At a minimum, it should do four things.
- First, it should clarify the vision of your organization; essentially is a brief description of our company in the future.
- Second, it should identify our Pillars of Success, or the foundation of your company’s future success.
- Third, it should explain what results you must achieve. In sports, individuals and teams need to know what results they have to achieve to win. The same is true in business. This can be expressed as strategic objectives.
- Fourth, the plan should detail the metrics that will be used to track progress. They can take the form of a dashboard.
When you have a lack of clarity about what you are trying to accomplish it creates uncertainty, which leads to a lack of self-confidence and ultimately sub-par performance. A powerful strategic plan helps you to see the future as clearly as the past.
3. Provides a touchstone for on-going decision-making
In early times before the advent of modern currencies, touchstones were smooth dark pieces of rock, which when gold was rubbed on it, left a distinctive mark. This was the difference between making a fair trade or being taken. You should think about the elements of your plan as a touchstone for decision-making. You should continuously ask yourselves, by taking this action will it move you closer or farther away from where you want to be?
Decision-making should be linked to review processes. Some organizations are good at developing plans. Some organizations are good at developing plans and implementing them. Few organizations are good at planning, implementing and reviewing results. It is essential to review results against the plan to understand the nature of the work that has been done to date, the challenges that have been overcome and the challenges that still need to be addressed. These learnings can make a qualitative difference in the capability of our organization to get traction on the major issues and achieve the results we set for ourselves within the strategic plan.
4. Better allocation of resources
There are a million ways to spend money and deploy people. The trick is to spend in the most effective and impactful ways. If you have a planning hierarchy that is aligned to the strategic plan there is more likelihood that resources will be deployed effectively. Think of the planning hierarchy from the perspective of height. Strategic objectives can be viewed at 30,000 ft, key initiatives at 20,000 feet, annual work plans at 10,000 ft and project action plans at 1,000 ft. If you are truly aligned in your planning, you should have confidence to invest in your action plans with the appropriate levels of people and money.
5. It gets everyone off the bus
One of the real challenges in organizations is to get everyone ‘singing from the same song sheet’. The planning process should ensure that everyone knows, understands and acts on the strategic direction of your organization. If the plan is not a catalyst for action, then it has no utility. You must do the plan and then ensure that everyone “gets off the bus and helps push it up the hill”.
A powerful strategic plan is built on a sustainable model. It provides certainty for your people. It is a touchstone for decision-making and enables a better allocation of resources. It provides the basis to get everyone aligned and engaged in building a more successful organization. That is something worth investing in.