2023 is just around the corner - it’s time to get your strategic plan in place. How will you ensure that your plan meets your business goals, inspires your team, and reflects your desired team and company culture?
Not surprisingly, many leaders dread the annual strategic planning task. It can feel bureaucratic, distracting from what is often an intensive last quarter of the year, and discouraging when previous plans are forgotten or not achieved. In many cases, this results in strategic planning not being given the right amount of attention, which can lead to lower-quality decisions. This could be decisions being made by too few individuals and/or without enough contextual information and perspective.
Not having a robust and thoughtful plan increases the business’s risk and ultimate survival at a time when companies are dying increasingly younger (32% within 5 years of their founding).
But, there is a way to not only mitigate this risk but to use the process to build sustained growth by establishing and cementing your leadership team’s effectiveness in the way they collaborate to develop the strategic plan.
We’ve found that being clear and aligned on 3 core questions leads to a highly impactful strategic plan on which your leaders are fully aligned on.
Question 1: What’s the purpose?
This HBR article makes the point that “Strategic Planning Should Be a Strategic Exercise”. Too often, the nature of the discussions is operational, not strategic, or even worse, they are taken over by the budgeting process.
Strategic planning is externally oriented - with your team determining how your organization will respond to the opportunities and risks, understanding what is changing in the environment, and deciding how to align your business to this.
Question 2: What’s the time horizon?
This will determine if you are building or updating your strategy, or if you are tracking progress and fine-tuning your existing strategy.
When talking about Annual Strategic Planning, for example, the time horizon is the next 12 months, and you are likely to be addressing: existing strategy execution effectiveness; evaluating changes in the market; identifying critical questions to answer, and validating resourcing requirements.
Question 3: How will your leaders go about it?
Well done strategic planning requires leaders to be thoughtful in their approach to the process. That includes choosing the right planning model (OGSM, OKRs, etc.) and applying appropriate frameworks (SWOT, scenario planning, etc) to help the team to organize and analyze quantitative and qualitative information.
Strategic planning is not only about collecting data and completing templates though. It needs people to make sense of the data; discuss and debate the insights and how they impact your business; make choices with tradeoffs, and develop the belief to execute these choices and plans. The people you choose to involve and how you design the collaboration within the strategic planning process are important. The way you facilitate these conversations is also important. We’re biased here, but we highly recommend engaging an internal or external (Werq!) facilitator to help you design for interactivity and effective collaboration. Engaging someone who isn’t a part of the direct team to facilitate the process also allows all direct team members to fully participate instead of having to wear multiple hats.
Having conducted this work with executives across a variety of industries, we’ve experienced how the leadership team’s planning approach, cohesiveness, and use of facilitation translate into real results. Results in both the plan that is created and their commitment to lead the execution of the plan.
Two bonus tips that we have also identified from our work:
- Keep it simple. Think around three key areas of focus to achieve your company’s mission and annual/long-term targets. Too many “strategic” focus areas mean nothing is truly a priority. Boil it down to the vital few.
- DO validate but DON’T fall into analysis paralysis. There is no “perfect” strategy in business. There are wise priorities, achieved through a sound process, and validated where appropriate, with an expectation that you and your leadership will adapt as needed. Strategy is also about momentum. Make good (enough) choices and get to it.
Solid strategic plans are what make companies grow from average to record-beaters. And they’re meant to be continually refined, updated, and challenged. Keep improving the strategic planning process. Engage the right individuals, keep it simple, and remember to get to it!
If being the visionary that sets exciting and achievable goals is a priority for you, make sure you’re setting effective strategic goals for the upcoming year. And if you need help, a strategic planning partner can help. Contact Werq to get more information on how you can ensure success for your team.