Business Strategic Plan

Many organizations engage in the annual ritual of writing a strategic plan. Although this custom is accepted as a due process for operating a business and is intended to be helpful, it is often a wasteful and unprofitable use of time, money, energy, and effort for the average organization. Once written, most plans are filed into a binder, and put on a shelf where they are left to collect dust.

Far too many organizations do not achieve what they set out to do simply because they put a majority of the effort into writing the plan or having the planning session, but when the progress is evaluated months later, nothing has changed. Nothing has improved. Nothing is happening. The next year they do the same thing, with the same results.

Effective strategic planning has a number of elements that matter, but the one most often forgotten is the clear, precise identification of the desired results. Unfortunately, most plans are so long, so complex and so wordy that whatever message is trying to be conveyed is lost.

The “desired results” do not always pertain to new opportunities or unexplored corporate frontiers; they may be more concerned with reversing negative trends in the organization and capitalizing on the current strengths. Many organizations conduct a SWOT analysis (“Strengths, Weaknesses, Opportunities, and Threats”) in the hopes that this will illuminate the true potential and dangers facing the firm. However, in our humanness we tend to emphasize the opportunities, finding little fascination or inspiration in addressing the current position of the company.

Having recognized this improper focus and lack of clarity in performance goals, we can then see that there is another element of strategic planning that is commonly overlooked.

An alternative method of achieving the same assessment is to lay out the “cold hard, brutal facts” of the current reality. At the end of the day, there might be hundreds of potential “opportunities” for the business to exploit, yet to disregard the facts of the present is foolishness. If cash flow is poor, why waste time discussing opportunities that the firm cannot afford? Face the facts, disregard opinions and deal with the “make or break” issues so that the business will survive and improve in the future.

In the best selling book “Good to Great” author Jim Collins uses a great personal story of James Stockdale to provide a “real world” example of how facing facts can be a matter of life and death. Stockdale was the highest ranking prisoner of war during the Vietnam War, held for over 5 years, tortured, beaten and starved, yet he understood the need to face “the brutal facts” but never losing the faith that “you will prevail in the end.”

This leads us back to what an effective plan must convey to the company employees: the desired results for the next twelve months. In today’s fast changing market, businesses must be able to adapt quickly to the changes in the market and therefore should focus on the road immediately ahead. There should be no more than three major objectives or thrusts for the year. Any more than that, and execution becomes a complicated, counter-productive task, quickly defeating the purpose of the plan to begin with.

Once the three objectives are determined, the desired results need to be broken down. This is best done by department, by quarter, by month, by manager, and by employee. Every employee must know and understand what is expected of them and how their role in the company influences the success or failure of these objectives; in other words, “aligning” the employees with the company goals in order to produce the best results.

Remember, the ultimate objective is to maximize the resources, people, talents, advantages, and potential of the organization to maximize profitability and other measurable objectives. Reaching this goal requires the uncomfortable investigation of the company’s current shortcomings. Nevertheless, a strategic plan that clearly states the “desired results” and is formulated from an honest, realistic perspective will be an indispensable asset in achieving this greater goal.

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