Why Your Organization’s Strategic Planning is Failing – Part 1 of 2

 

Strategic planning can be defined as an organization’s process of delineating its strategy (or direction), and then making decisions on allocating resources in pursuit of this strategy. Strategic planning often includes detailed preparation, an off-site planning retreat, and creating control mechanisms for guiding the planning and successful implementation of the strategy.

A best-practices approach to strategic planning I take most often with my clients includes the use of a 3-day offsite planning retreat. We take the entire time to identify the issues and develop the specific course of action to achieve the organization’s objectives for the coming year(s). It is both a fun and an exhausting three days that brings the organization together in some amazing ways.

 

Why Strategic Planning is a Concern

Over the past several years the discipline of strategic planning has fallen out of favor because some organizations have experienced less than expected results from executing their strategic plans. Analysis of why these organizations are not able to achieve successful results appears to originate from ten failure areas. The good news is that each area can be turned into a success.

While not exhaustive, the list of reasons why strategic planning fails in an organization should give you insight into the steps your organization should consider to assure that your strategic planning efforts are effective in helping to drive your organization.

In Part 1 I’ll deal with the first four areas in which failure can occur and the associated best practices to help prevent a failure in each area. Part 2 in two weeks will deal with areas five through ten.

 

Potential Failure Area 1: The RIGHT PARTICIPANTS were not included in the planning process

Not all the right participants were included in the process, causing missing or biased perspectives, leading to incomplete analyses and ineffective planning.

For example, during your last strategic planning meeting, how much time did each participant spend on the front lines of your organization gathering fresh data about what front line staff was seeing? If your company produces goods or services, then the front line staff has valuable information that should be considered in the strategic planning process. Absent its perspective, planning is more likely to miss something important.

Solutions: Once a decision is made to engage in the strategic planning process, one of the first objectives is to identify the right participants. Participant Group 1 includes the people who will go to the planning retreat. This group should include (at a minimum) ALL functional department heads and up. Participant Group 2 includes the people whose input is needed for the work of the Group 1 participants. Other participant groups will be identified throughout the course of the three day event. Sometimes it makes sense to include people outside the organization. The specific people and their participant groups are going to be determined on a case-by-case basis for each organization.

 

Potential Failure Area 2: No PRE-WORK was completed prior to the planning meeting

There is little or no pre-work prior to the planning session, leading to hasty decisions with incomplete data. Some data and information might be already published in the organization’s reporting, so pre-work might include additional analysis of that data. Pre-work could also include the gathering of input and perspectives from front line staff, customers, vendors, key business partners, and industry experts.

Solutions: Once the decision has been made as to the participants, the next area to address is to identify the right pre-work that is needed. Since planning sessions usually have several months’ lead time, pre-work can be assigned and completed in order to equip the Group 1 Participants with everything they will need to make optimal decisions at the planning retreat. The specific pre-work assignments will again be determined on a case by case basis. Another part of pre-work is booking the right planning retreat location, building the retreat agenda, and other details necessary to make the retreat flow as smoothly and efficiently as possible.

 

Potential Failure Area 3: The planning process occurred without a tight session AGENDA

There is no planning process agenda to move the planning activities to productive and timely conclusions. It is easy for any meeting to get off track quickly, such as in the time spent discussing issues that don’t directly pertain to the strategic planning objective itself.

Without a well-designed meeting agenda, most organizations underestimate the time that effective strategic planning will take. Coupled with a lack of pre-work, what often occurs is back-of-the-envelope planning, rushed decision-making, and unaddressed areas.

Solutions: There are a number of different activities that make up an effective planning retreat. Some activities require pre-planning. A good agenda outlines the right amount of time to be spent in each planning retreat activity while mixing in teambuilding and energizing activities to keep people sharp and the process productive. A well-crafted agenda will maximize the work accomplished in the planning sessions without fatiguing the participants.

 

Potential Failure Area 4: Participants were not ALIGNED for the planning process

People coming to a strategic planning event usually do so with their own departmental agendas. So it’s business as usual with each participant competing for resources. The net result is that actions might have a personal or departmental bias instead of what is best for the organization as a whole. Without alignment, count on selfish behaviors to be the order of the day.

Solutions: When facilitating a strategic planning program for a client I typically spend the first six hours of the three-day planning session aligning the participants. This approach pays off rapidly by accelerating the planning process and minimizing cross-purpose distractions. I first use a team-building / shared-learning exercise to break down the silos between people, then help the CEO (or board) cast the vision for the future towards which the planning retreat is focused. Finally, I align everyone around the key performance indicators (KPIs) that we’ll use to discuss and vet ideas, potential solutions, and to create specific plans.

 

Part 1 Final Thoughts

Organizations that use an effective strategic planning and execution process tend to succeed in sustainable profitability and growth. Planning well is essential in the face of increasing market disruption, global competition, and emerging new technologies.

Part 2 will appear here in two weeks and address six more potential failure areas and their solutions.

 

Author’s note: I’ve spent more than 30 years facilitating strategic planning programs for organizations large and small, profit and non-profit, public and private entities. Some of these programs have produced stunning results, such as a $500 million valuation increase in 18 months or six consecutive years of double-digit profit and sales growth. I guarantee a full ROI or your money back. Contact me to learn more about our Strategic Planning Made Simple™ programs and expert facilitation.