Posts tagged failure to plan

The Importance of a Stakeholder Assessment

Change Management Strategic Planning Think Big February 15, 2014 2 Comments

Strategic planning, as a structured and systematic process, is successful when it is leader-led and overcomes the five reasons 70% of all strategies fail. Learn how to see your plan through to success. The strategic planning process is where leaders of an organization establish the vision of the organization’s future and then develop and implement the actions necessary to achieve that future. This article expands on the strategic planning concepts addressed in Think Big, Take Small Steps and is designed to help you achieve success in your strategic planning process.

Conducting a Stakeholder Assessment When Developing a Strategic Plan is Crucial

I see a “strategy” being made up of three things: A mission, a vision, and goals on how to get from where you are now to where you are going. Those goals represent CHANGE in an organization–strategic change.

Anytime there is a change, there will be people who are for it and against it. The rest are the movable middle. Anytime you are planning a change, you need to analyze the audience that will be impacted by that change and continually manage that audience through the change.

Case in point: One of my clients had the words, “Meet customer’s expectations through product delivery,” in one of their goal statements. The strategy had been in place for several months, and the head of their operations was not supportive of the strategy–he wanted to create it himself versus as a leadership team. He also liked living in the realm of strategy because then he really wasn’t accountable for doing anything. Note that ‘accountable’ is a key word here. I was in a meeting with the head of the strategic planning department and the operations director and he said, quote, “I will not hold my people accountable for meeting customer expectations.”

Who, in the right mind as a leader, can say something as ludicrous as that? By this time, the strategy was really rolling out–plans were in place and changes were occurring. All this went on regardless of how much he tried to stop it. This was the cry of a desperate man. As a result of the shadow he cast, one of his directs was responsible for deploying part of the plan–specifically under this goal. We were attempting to establish actions and dates, when he broke down in a whiney voice almost on the edge of tears, and cried, “But, I don’t want to be held accountable to this.”

These situations are real. Strategy–good strategy–means change. If you are not prepared for this type of behavior from people that have influence and you require to make the strategy reality, then you will get stopped by this type of behavior.

I know in Good to Great, you are supposed to get people on the bus and off the bus to make things work, but in the real world, some organizations don’t have that luxury. Then you have to determine how to deal with them.

In a strategic change, there are four potential groups that you have to consider. Obviously, first are the stakeholders–those who have a vested interest in the change and impact of the change. Second are the customers–those who direct your organization to deliver goods and/or services. All customers are stakeholders, but not all stakeholders are customers. Two other potential groups are Partners and Suppliers. Partners and Suppliers are those you work with to deliver your goods and services to the Customer. Sometimes they can be everything, or sometimes, not. Understanding who they are and who of them are key–make a difference and can impact the change–is important. Note this Venn diagram and how these audiences interact.

Once you know who they are, list them out and try to determine what you know about then and what you don’t know about them. List out what stake they have in the change–what will be impacted and how they feel. On a scale of 1-5, rate their level of support of the change and on the same scale rate the level of influence that can have to impact it–1 being lowest. This tells you where you potentially could have your most difficult problems. As you can imagine, the Operations Director in my above example was low in support and high in influence–not a good combination. Those that are high in both can also become your greatest champions. Those who are low in both probably can be ignored–best to spend precious resources on the most important stuff.

With those that are important to this effort, plot them each on this continuum:

If they are low, or not even on the continuum, then, strategic activities designed to raise them on the continuum might help their acceptance and assistance. Sometimes they fully understand what is going on, but, getting them higher is impossible. In the case of the Operations Director, we basically forced him to retire and the next director that was hired supported the strategy. The bus activity; however, this took time. Obviously, if someone is simply aware of the strategy and doesn’t understand why it’s being done and what its impact is, then desiring advocacy and ownership is impossible. So, if you have someone at awareness, but you need them as an advocate, then you need to first get them to understanding, and then next to acceptance. Makes sense, right?

This is also helpful to determine if you already have someone at advocacy and that’s where you want them, then you don’t need to do anything. If someone has little influence on the strategy and change, then maybe awareness or understanding is fine. These decisions again allow you to focus your efforts in strategic areas.

Another way to map your audience is through this tool:

It’s a bit simpler in its approach, but can be effective. For a strategic plan, which takes years to implement, I like a much more detailed assessment and action plan than this, but you can choose. I also am Prosci certified in ADKAR, so I like to use that approach, but I am not free to share their proprietary process on this blog. You can read about it in books from Amazon and their certification is very effective. The approaches I’ve shared here are based on my Master’s-level Change Management certification from Georgetown University and are not proprietary.

So, you can see how important a Stakeholder Assessment is to develop during the Organizational Assessment. This, like any change effort, when done early, helps to prep the space and get people on board quickly or identify those you need to work around. This tool, is a lasting assessment that you may revisit regularly to see how things are progressing.

So, 70% of all plans fail to some level; however, by following these guidelines you can help ensure your strategic plan will be one of the 30% successes that everyone reads about.

2. http://www.amazon.com/Change-Management-The-People-Side/dp/193088561X/ref=tmm_pap_title_0?ie=UTF8&qid=1392477543&sr=8-2

3. http://en.wikipedia.org/wiki/Stakeholder_analysis

Assessing Your Organization Using the Military’s DOTMLPF – FREE Assessment

Strategic Planning Think Big February 8, 2014 11 Comments

Understand How to Use this Military Assessment Tool to Assess Your Business

Several years ago I was working with a major Army headquarters in the north central United States. They had been growing over the past several years, merging various related responsibilities into their organization. The problem was that they were more just bolting these new capabilities on, versus really integrating themselves to deliver a seamless capability.

I was called in to help them come up with a multi-year strategic plan. This was mainly because the headquarters over this headquarters was developing a new strategic plan. So there wasn’t a lot of buy in for strategic planning.

They even had a planning department with five people that were responsible for strategic planning. After the kickoff, I sat down with the head of the strategic planning team and he told me they had already developed three strategic plans over the past five years and I would fail at delivering anything useful, but he was here to support the year-long project.

Nice start, huh?

In the first blog of this series Think Big, Take Small Steps, I talk about the three things that you must have in strategic planning or you probably will fail:

Executable Focus
Strategic Framework
Traceable Implementation
Rigor and Accountability
Communication

In that article, I point out that all successful plans have an Executable Focus. If a plan lacks focus on fixing organizational problems and overcoming barriers to the organization’s vision it is not built on the realities of the environment impacting the organization.

Well, this team had built three strategic plans by themselves by coming up with fancy words that started with mission and vision, but were not built off any discernible assessment. As a matter of fact, they were so proud of their last “strategic plan” because they were able to get it to one page.

So, I’ve explained why doing an solid organizational assessment is important to ensure the success of your plan. The reason I highlight this client over many others that were much the same, is because this client is where I developed my DOTMLPF-FREE approach that I still use today.

It was very important to the commanding general of this organization that we use Army and Joint Force strategic planning guidance and approaches. Actually, the plan was actually called a “Campaign Plan” to fit this desire. So, I needed an assessment approach that he and his staff understood and accepted. The term “Environmental Scan” was foreign to them–this is something I’ve run into before with military clients. I decided to use the framework used in Joint Force planning called DOTMLPF. Unfortunately, their literally is nothing significant written about this, aside from what the letter mean.

D — Doctrine
O — Organization
T — Training
M — Material
L — Leadership
P — Personnel
F — Facilities

I was also concerned about things this approach didn’t cover, so I added the acronym “FREE” to the end of this assessment tool:

F — Finances
R – Relationships
E — Efficiency
E — Effectiveness

So, to use this in phonetic terms, say, “Dot Mil P F, Free.”

I won’t talk about it here, but I have since added “Plus I Squared,” to the acronym (DOTMLPF-FREE+i²). This incorporates Innovation and Information.

I outline my interview template following this format. I also ask through the interview for the interviewee to rate a particular item from 1 to 5 and I’ll ask, if it’s not a 5, what would it take to get to 5. I gather all these score and present the results in a Radar chart (see below).

Doctrine
Doctrine covers is current mission, vision and guiding principles of the organization. Here is an example of how in depth I get with the questions associated with the mission part of doctrine:

1. A “mission” captures and expresses the enduring nature of what the organization is about – its purpose and focus. The current mission statement of your organization is, “XXX.”
1.a. What does this mission statement mean to you?
1.b. Do you feel the mission statement articulates the fundamental purpose of your organization? If not, what needs to change?
1.c. Do you feel the mission statement provides enough focus to define your organization’s reason for being, yet allows maneuvering room to execute it? If not, what needs to change?
1.d. Do you feel the mission statement focuses on “what” your organization does or “how” ASC does their mission? If not “what,” what needs to change?
1.e. Do you feel the mission statement clearly reflects customer and stakeholder needs and expectations? If not, what needs to change?
1.f. Where does your role in the organization fit in the mission statement?
1.g. If you would define the mission of your organization differently, how would you define the mission of the organization?

As you can imagine, I get quiet in depth with the categories.

Organization
In organization, I’m looking at structure (looking for stovepipes), accountable governance, and internal communication.

Training
Training covers organizational education, training, and development of all leaders and personnel.

Material
Material or Materiel, covers equipment, suppliers, tools, and information systems and software.

Leadership
I’m looking at capability, emotional intelligence, servant leadership, and engagement.

Personnel
Your employees are your greatest asset. In personnel, I examine the knowledge, skills, and abilities; how they are being used (8th waste in Lean); do they have the right types and amounts; capacity and productivity; and their engagement.

Facilities
Facilities includes things like buildings, space utilization, conference rooms, and furniture. I look at this from a main headquarters and distributed offices perspective…normally HQ is much better than the geographically located offices.

Finances
I ask several different questions. How well is the organization budgeting and forecasting? How close is their planned and actual? What do they do with excess or when they overspend? Do they use any activity based costing or management techniques.

Relationships
Relationships covers how they interact with their customers, stakeholders, partners, and suppliers. I also talk to the key ones in each group and find out what they think about the organization and how the relationship is. It’s always amazing how much different the two are.

Efficiency and Effectiveness
Efficiency and Effectiveness speaks to their use of metrics, process management, improvement activities, total cost of ownership understanding, and operational excellence.

As you can see, by following this guideline, you can really obtain a very well-rounded assessment of any organization. Although this was a military tool that I repurposed, it works for any organization. Today I have added Innovation and Information as two other areas I look at, but I think you get the gist.

So, 70% of all plans fail to some level; however, by following these guidelines you can help ensure your strategic plan will be one of the 30% successes that everyone reads about.

Related Links:

1. http://en.wikipedia.org/wiki/DOTMLPF

2. http://www.dtic.mil/doctrine/new_pubs/jp1_02.pdf

3. http://soldiersystems.net/2012/05/11/dotmlpf-what-is-it/

Understanding the Different Assessment Tools

Strategic Planning Think Big February 1, 2014 6 Comments

Strategic planning, as a structured and systematic process, is successful when it is leader-led and overcomes the five reasons 70% of all strategies fail. Learn how to see your plan through to success. The strategic planning process is where leaders of an organization establish the vision of the organization’s future and then develop and implement the actions necessary to achieve that future. This article expands on the strategic planning concepts addressed in Think Big, Take Small Steps and is designed to help you achieve success in your strategic planning process.

Knowing What Assessment Tools Exist is Half the Battle.

Last week, I highlighted several organizational assessment tools in my blog How to Conduct an Organizational Assessment. This will be a relatively short blog, compared to my others, because I just want to highlight some tools and in future articles, I will describe them in more detail. Please Follow My Blog to keep up with this running story. If you want to start at the beginning, check out the linked article in the first paragraph.

The most important thing to do, when conducting an assessment, is to structure your approach. I use an approach that I term DOTMLPF – FREE. This covered the areas of Doctrine, Organization, Training, Material, Leadership, Personnel, Facilities, Finances, Relationships, Efficiency, and Effectiveness. This is a fully rounded approach that allows you to score, evaluate, analyze, and report out an organizational assessment. I will fully cover this tool next in Assessing Your Organization Using the Military’s DOTMLPF – FREE Assessment.

When I conduct an organizational assessment, I always use three specific tools: a Stakeholder Assessment, a Change Readiness Assessment, the SWOT Assessment.

The Stakeholder Assessment is great for any change-related activity to determine who will be supportive and who will not of the change. It helps to outline what actions you need to take to gain their involve or mitigate their negative influence. Being a certified Prosci practicitioner, I use the ADKAR model for my assessment. All strategic plans, if implemented, result in change, so this is a very helpful tool to prepare for the development and eventual implementation.
Additionally, I like to use a Change Readiness Assessment to determine how ready the actual organization is for the upcoming strategic change. This is different than the Stakeholder Assessment, because it looks at change readiness from the organizational point of view. It is very helpful and a relatively short assessment that is easy to perform with a small team.
The SWOT assessment, if generally how I report out everything I find from my interviews following the DOTMLPF-FREE format. If you didn’t know, SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. As a general rule, I change the word Weaknesses to Challenges–it just goes over better. Most leaders have heard of the term SWOT Analysis from some business class or in the course of their work–seldom do you find anyone who can conduct one. The trick is, that I don’t “conduct” a SWOT Assessment–I assess what I learn about the organization using a SWOT grid and present the results in that manner.

SWOT, in my mind, is a high-level assessment and report. I also assess what I’ve learned from the DOTMLPF-FREE approach through a TIPS Assessment–Trends, Issues, and Problem Statements. What I do, is, using Affinity Diagramming, I build the major TIPS that the organization is faced with. These are also called “Emerging Insights,” which I’ve used in Army Campaign Planning. Under each major issue (defined through the Affinity Diagramming), I provide this general view:

Emerging Insight, Focus Area, or TIP Title
Assessment Observations: Things learned from the research and interviews aligned to this specific area.
Initial Recommendations: Specific recommendations I have, based on the observations, that they need to do to overcome this issue.

When I collect information from my research and interviews, I normally start organizing it in Microsoft Excel under buckets. The beauty of this type of analysis is that it provides the leadership with key areas that they need to work on to make their strategy successful. In many ways, these formulate at least some of the objectives during the facilitated session. Everything else builds to these key items.

You may find use for several other types of assessment and I would love to hear about ones you’ve used, especially if you can share links in the comments below. I love using maturity models for assessing organizations. I’ve even created a specific maturity model when none existed. These models provide a very organized view of the organization’s or domain’s maturity, benchmarks them against industry, and provides a roadmap for them to follow to get better.

Additionally, there are a number of industry specific assessment tools–like a specific assessment to look at non-profits, or assessments to look at finance, information technology, innovation, etc. When you discover a specific (major) challenge with a company, I suggest you research possible assessment tools, or don’t be afraid to create your own. A key point is, normally an assessment tool is nothing more than a structured survey method. All of these assessment tools ask specific questions and the results (answers) formulate the assessment of the organization.

A good example of a powerful assessment tool would be Gallup’s Employee Engagement Survey. This is a widely-use industry standard assessment tool to determine how engaged (or committed) an organization’s employees are. This can be a very helpful assessment and I’ve worked with the results for a couple years now.

Another example, would be ISO 14001–Environmental Management System. For several years, I worked for several EPA and DoD clients in the world of Environmental Management. I used this ISO standard as a key assessment tool for these engagements. This brought a level of professionalism and validity to my work with them, but also gave them something to use year-after-year, much like the Gallup Survey.

The summary of this article, which I expected to be shorter, is that you need to develop a stable of key assessment approaches and tools to analyze and present your analysis in the next phase of the strategic planning effort. You also should be aware of other possible tools for the industry you’re dealing with or tools that can help the organization focus on a specific area. A key factor is that you can overanalyze a situation by bringing in too many tools. Make sure the ones you use are effective and you keep overlap to a minimum. For an example, I use a Stakeholder Assessment and Change Readiness Assessment with every organizational assessment. They both deal with change capability, but they are focused differently and together complement each other.

Stay tuned to future weeks where I will explain some of these specific assessment tools and demonstrate more about how I use them for analysis and for reporting. I will also try to provide at least one example of the tool for your use.

So, 70% of all plans fail to some level; however, by following these guidelines you can help ensure your strategic plan will be one of the 30% successes that everyone reads about.

Related Links (find three links related to the topic of the article):

1. http://en.wikipedia.org/wiki/SWOT_analysis
2. http://en.wikipedia.org/wiki/DOTMLPF
3. http://www.gallup.com/

How to Conduct an Organizational Assessment

Strategic Planning Think Big January 25, 2014 10 Comments

Establishing an Executable Focus to Ensure the Success of Your Strategic Plan.

It really doesn’t matter what you are doing; if you are planning to change something from what it is today to something different tomorrow, then you need to understand the way it is today. The reason this is important in strategic plan development is because a strategy and associated plan should be designed to overcome current barriers to your vision. I like to use the image of building a bridge over troubled water. Today you’re on one side of the bridge and you need to get to the other side.

If you didn’t know how deep, how fast, and what lies below the surface of the water you plan to cross, then you’re bound to fail. So, an organizational analysis is a survey of the river and a testing of the banks to determine the best way to build your bridge.

I have heard many terms over the years, like preplanning analysis, environmental scan, SWOT analysis, etc. There is nothing wrong with these terms, but my plan is to show you how to ensure whatever you call it, it provides you with the data you need. I use the term organizational analysis, because that seems to be the least technical and better understood by my customers.

Some of those terms used above are tools that you might use during an assessment. I plan to cover many of these tools next week in Understanding the Different Assessment Tools. Also, I want to share a very specific tool that I learned about in the military and now apply in all of my assessment activities. I will talk about this tool in two weeks in Assessing Your Organization Using the Military’s DOTMLPF – FREE Assessment. Future articles in this series will cover other tools, like a Stakeholder Assessment, a Change Readiness Assessment, the SWOT Assessment, and Scenario Planning.

Today is simply an overview of the approach I use and when I apply these various assessment tools. I look forward to your ideas on the approach and others you have used.

The closest approach to what I use to assess an organization, that I have seen documented, would be the Delphi Technique. The Delphi Technique is comprehensive, but I add some things to it. Let me outline the activities as I like to see them occur during an assessment. Sometimes, this approach changes, or (in many cases) things happen at the same time. I’ve completed assessments as quickly as a couple of weeks and I’ve had one take four months. This will depend on the size and complexity of the organization. Additionally, if the organization already has somewhat of a grasp of strategic planning and a plan in place that isn’t too bad, it can speed up the process. Don’t simply rely on what they’ve done–there is a good chance they missed things to get it done quickly.

Here are the activities I employ to conduct the assessment:

RESEARCH

First I start with conducting as much research on materials and data the organization uses to communicate, direct, evaluate, and improve the organization. I review everything they put out about their company in print and through the web and social media. I look at current strategies, policies, and directives. I review their organizational structure and understand the purposes of each organization and relative employee and contractor strength. I look at what training programs they employ and attend and the level of knowledge, skills and abilities of employees and leadership. The list goes on…

In two weeks, I will lay out the specific framework that I use to review an organization and formulate the next stage. A key component of this research is to determine who to interview and what to ask. The next step in my assessment is developing interview questions that are influenced by my research.

The most important thing is that you can’t conduct an assessment on research alone. What people put in writing is never exactly how things are really working. You must interview people to verify your findings and get to the entire picture.

Expect your initial research to take up to a week. You will continue your research even after you’ve started your interviews, because you will come across other things to consider and review.

INTERVIEWS

Interviews with key leadership, knowledgeable employees, organizational stakeholders, customers, and strategic partners are key to the success of an organizational assessment. Your interviews should be focused on obtaining a good picture of what the organization is facing. Much of the topics listed in the research section are repeated here. The framework I use to gather data is the same framework that I use to interview. I call it DOTMLPF-FREE.

The number of interviews vary based on organizational size and complexity. I normally can get away with simply 10 to 20 interviews, but my longest project had 44 interviews. The client was adamant about us getting many views from across the organization and outside the organization. Honestly, in three or four interviews, I normally know what’s going on…the remaining interviews simply validate what I know and what’s already been said.

To ensure that you are systematic in your interview approach, make sure you use an interview questionnaire. Don’t ask the questions word-for-word, but use it as a template to drive your interview and make sure you don’t miss anything. It can be helpful to send the questionnaire out before the interviews to help people prepare their thoughts and possibly provide key documents that you might need. However, don’t allow them to fill it out and send it back–you will lose everything in this approach, Trust Me.

Written interview templates help your clients see the breadth and depth of your assessment before you are too deep into it. I normally have them approve the questions and also ask if there is any question(s) they would like added–something they really want to know. Your clients should also approve the interviewee list and can recommend adding names of people you hadn’t thought of.

Be careful with the number of interviews–rule of thumb is it take three hours for every interview–an hour for the interview, an hour to document the interview, and an hour to tie the results into your analysis. So, ten interviews is 30 hours–almost an entire week. When you apply how busy the interviewees might be, getting on their calendars means you can expect a week per ten. If the interviewees require travel to other locations (in other states or countries), then you can expect this timeline to increase. The organization that took me four months, took a month for the research, and three months for interviews due to schedules and traveling. Part of that time, of course, is the next steps of putting it all together.

Having written interview templates helps if you have multiple interviewers working with you on the team. They can follow the template and bring back data. Make sure they know what and how to ask questions–they can’t simply follow the questions, it has to be a guide. But, for large efforts, a team can help. I always try to have someone to take notes, so I can simply ask questions. I do take my own notes and write everything down afterwards, but having a second person helps me focus on the interviewee. Once I used a recording device, but I think this was a distraction for the interviewee and don’t recommend it.

ADDITIONAL ASSESSMENT TOOLS

Based on time and availability of staff, I like to conduct various different analyses of the organization. These take the form of change readiness assessments, stakeholder assessments, culture assessments, process and enterprise maturity assessments. Using these types of tools, if you understand them, can provide a measuring stick for the organization to use over-and-over, year-after-year. This way they serve as a solid stake in the ground for the current state, a progression meter for the future, and in some cases a basis for comparison against other organizations. A great tool used by many organizations is the Gallup Employee Engagement Assessment. This tool measures employee engagement within the organization off a small set of questions. I will discuss several of these tools in future blogs, but the Gallup tool, I’ll leave to your own research.

Once you’ve done your research, I like to organize my assessment presentation in a very specific manner. I normally (taught by Booz | Allen | Hamilton) use a very detailed and in-depth PowerPoint presentation, but the format can work with a written assessment as well. Here are the major areas of the assessment:

1. Purpose.

2. Key Recommendations.

3. Planning Approach showing the entire planning approach being used and where we are at the point of this report.

4. Assessment Inputs:

a. Number of Interviews.

b. Key Documents researched.

c. Assessment tools used.

4. List of all interviewees by type.

5. List of key documents reviewed.

6. Identification of key Stakeholder, Customers, and Partners. I will talk much more about this in a future blog.

7. Organizational structure at a high level and manpower/human capital assessment.

8. Key metrics used by the organization that highlight strategic progress. Thos in the areas of satisfaction, financial, performance, and personnel.

9. Assessment tool results.

10. A high-level Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis — like an executive summary of the big study.

11. Consolidate and prioritize the trends, issues, and problems (TIPs) facing the organization and develop them into single issues. This is the meat of the assessment and what formulates the Key Recommendations in the front of the assessment.

Once I’ve completed my assessment, I will sit down with the primary Client so that he or she can review it before anyone else in his organization sees it. This way, they get the unfiltered view of what is going on, but can adjust the product so as not to embarrass or throw anyone in the organization “under the bus.”

At this point the assessment is completely truthful and if the client is part of the problem I will say it. I honestly do not pull punches, I just deliver with tact. Never tell someone they are the problem without justification and examples and always be prepared with recommendations on what they could and should do about it.

Also, I don’t highlight anyone’s specific opinions from the interviews. This protects them for telling the truth and protects your reputation. I caveat my analysis based on research and interviews. What I saw, might not be the full truth, since sometimes you only see a slice of what really is happening.

The strategic plan should be a transformational document for the organization. It will clearly outlines the mission and purpose of the organization and where they are going in the next 3-5 years, which is codified in the vision. A good strategic plan should lays out a systematic plan to close the “gap” between where they are now and where they are going. This “gap” is identified by the organizational assessment results. A good and throughout assessment will help define a very strong strategic plan.

So, 70% of all plans fail to some level; however, by following these guidelines you can help ensure your strategic plan will be one of the 30% successes that everyone reads about.

Related Information:

1. http://en.wikipedia.org/wiki/Delphi_method.

2. http://www.gallup.com/.

3. 12: The Elements of Great Managing, by Rodd Wagner and James K. Harter

When Does Your Company Need a Strategic Plan?

Strategic Planning Think Big January 19, 2014 3 Comments

Realizing When You Need a Ship and When You Need a Life Raft

You know you have a problem in your company. You see your profits dropping, your customers are leaving you, your market share is eroding, employee turnover is at an all-time high. All signs point to a company on the rocks–and I mean “on the rocks!”

Shaking your head as you read over your latest figures, you wonder what’s going wrong? In that business class you took a few years back–the one that you thought would help you run things better–they talked about the need for a strategic plan. “Every organization should start with a plan–a business or strategic plan,” you remember the professor saying.

Looking back at your numbers, you realize that’s something you really never got around to. When you came back from the class, you remember drafting up some words that describe what you do and calling it your mission statement. You even created a lofty vision statement just like the man said to do. You had them posted in a frame in the front office for all your customers to see.

That seemed like the thing to do. You really weren’t sure, because you didn’t put much stock into planning at the time. Maybe you were wrong? Maybe you should have paid more attention during that lecture? Perhaps it’s time to create a strategic plan after all?

Nope!

The first rule of strategic planning is that it’s never a quick fix for your company. Planning–good planning–takes time. The result is a plan, not action. In reality, it can take one or two years for an organization to actually mature their strategic plan into something that actually makes a difference. And that’s if you get the plan right in the first place. An implemented strategic plan doesn’t actually fix your organization, what it does is position you strategically to take advantages of opportunities in business and provides capability to improve operations.

Thinking that a strategic plan will solve your problems when you are “on the rocks,” is like throwing a lifebuoy to someone who fell overboard in a hurricane. There isn’t much chance of survival.

If your organization is bleeding that much, you need immediate professional assistance–you need a tourniquet, not a band-aid. Call in the professionals and have them conduct a throughout assessment of your operation. Chances are you might even be part of the problem–learn to accept that and move on. Most likely, not only do you have back office business problems like a lack of communication, lack of training programs, lack of performance and process management, and a lack of strategy, but you probably have significant operational issues too. What you are delivering to your customers lacks quality, doesn’t meet their needs, or is constantly being delivered late.

For organizations that have a pretty solid operation–they’re delivering good work, but seeing stresses on their organization and operation, generally there are business constraints that are holding them back from delivering better service. Ignored for too long, these stresses turn into stress fractures and everything starts to fall apart. When the operation is solid, but there is room for improvement, then strategic planning is the first step. It should have been the first step anyway, but if you have issues in your organization, I’m going to guess that what plan you currently have (if you have one at all) is pretty weak.

When the operation–the core thing you do–is failing, then immediate triage is required. Fix the operational issues first and then look to the strategic plan. I’m not telling you that you don’t, or won’t need a solid effective strategic plan that overcomes the five reasons that strategic plans fail, but it’s not going to save you. Right now you need CPR!

So, 70% of all plans fail to some level; however, by following these guidelines you can help ensure your strategic plan will be one of the 30% successes that everyone reads about.

2. http://www.dummies.com/how-to/content/happiness-know-when-to-plan-and-when-not-to.html

What Is Strategic Planning Really?

Strategic Planning Think Big January 7, 2012 24 Comments

Why Does Your Company Need a Strategic Plan?

Strategic planning, as a structured and systematic process, is successful when it is leader-led and overcomes the five reasons 70% of all strategies fail. The strategic planning process is where leaders of an organization establish the vision of the organization’s future and then develop and implement the actions necessary to achieve that future. This article expands on the strategic planning concepts addressed in Think Big, Take Small Steps and is designed to help you achieve success in your strategic planning process.

For many business people, strategic planning is a very foreign language. When I discussed the importance of strategic planning late last month, several people were probably giving the post a “deer in the headlights” look. The problem lies in the common definition of what strategic planning is. This lack of common definition causes everyone to form an opinion about what strategic planning is and then why they think they do not need it for their business.

Today I will distill the term strategic planning and demonstrate why it is so important to business success.

Understanding Planning

The Latin word for “Plan” is “Cogito.” Cogito is defined as to think, ruminate, ponder, consider, and plan. Plan; however, can be an action verb meaning to decide on and arrange in advance, or a noun meaning a detailed proposal for doing or achieving something. Confusion starts with whether you use the word “plan” as a verb or noun. No wonder everyone is confused.

An actual plan is any diagram (like a schematic) or list of steps with timing and resources, used to achieve an objective. The common understanding of “plan” is as a set of intended actions, through which one expects to achieve a goal. Plans can be formal or informal.

The most popular ways to describe plans are by their frame of reference or purpose, breadth, time frame, and specificity; however, these planning classifications are not independent of one another. For instance, there is a close relationship between the short- and long-term categories and the strategic and operational categories.

Planning is setting performance expectations and goals for groups and individuals to channel their efforts toward achieving objectives. It also includes the measures used to determine whether expectations and goals are being met. Planning, in essence means to develop a plan and keep it going.

Where a lot of the additional confusion arises is in the specific types of plans that are out there. Many times I have worked with different groups of people who say they are doing “strategic planning,” when in fact, they are not. There are many different types of strategic plans — all this tends to get very confusing so let me break these plans (and thus planning — the act of developing the plan) into easy to understand categories:

Plans fall into two different categories: Level and Type. First, I will define the two categories, and then I will provide some examples to help you understand the application.

Level. The level of planning is broken into Strategic, Operational, and Tactical. The best way to explain these three levels is to look at it from the reverse — tactical first. Tactical is your day-to-day, project-level activities. Tactical plans are short in duration (weeks to months) and usually implemented at the lowest level (not always developed there though). Operational plans are normally at the program level — there usually are several tactical plans that make up one operational plan and a few operational plans in a strategic plan. Operational plans are somewhat broader and longer lasting than tactical plans (months to years). Strategic plans are at the highest level. There normally is only one of each type (see below) in an organization. They are very long term (many years) and should drive all other (operational and tactical) plans (see figure below).

Type. There are many types of plans and as noted, there can be different levels of each type of plan. Generally the different types of plans follow somewhat functional lines. Some examples of plan types are business, financial, communication, marketing, information technology, etc.. This is the area that really confuses people, especially when you have the same level plan in an organization (e.g., A company has a strategic plan, strategic communications plan, and an information technology strategic plan).

As you can see, between the different definitions, the different levels, and the different types, the whole subject of strategic planning (or any planning for that matter) can get very difficult to follow.

Let me give you a few examples of situations and the plans that would accompany them:

Your supervisor tells you that the organization is trying to account for all the computerized assets they own and he directs you to conduct a major inventory and determine how to keep track of all the computer hardware and software for the 50 personnel in the section — you would develop a Tactical Information Technology Plan.
Your office has a new product line that has been out for a few months and is not selling well. In line with their communications strategies, they want you to develop and implement a marketing program for the new product — you build an Operational Communications and Marketing Plan.
As the new CEO of a small business, you were hired to improve the company. You see they lack direction and have a host of problems. You sit down and work with the organization to build and implement a Strategic Business Plan.

As you can see from the above examples, each of the plans developed are slightly different in their operational level and function; however, they are all just plans — a list of steps with timing and resources used to achieve an objective. The important thing is to understand the hierarchy of organizational plans and the differences between them.

A real world example of planning at its finest would be United States (US) National Strategy. The US develops an overarching National Strategy Document that outlines the country’s focus as a sovereign nation — this encompasses diplomatic, information, military, and economic realms and is at the strategic level. Both operations in Iraq and Afghanistan were major operational plans of activities that focused mainly on military, but also encompassed diplomatic, information, and economic activities. At the tactical level, specific actions were occurring over time to achieve these operational plans.

The Organization’s Strategic Plan Trumps All

“If you don’t know where you are going, any road will get you there.” ~ Lewis Caroll

Lewis Caroll’s quote from “Alice’s Adventures in Wonderland” is commonly referred to in many books and statements regarding planning. This quote; however, is especially important to every organization’s Strategic Plan. This is the granddaddy and mother rabbit of them all! If your organization does not have a published and well understood strategic plan, then somewhere in your organization someone is wondering why they are doing what they do.

Every plan that exists in your organization and every action in your organization should harken back to the Strategic Plan. If you are doing something that is not listed as an important strategy for the organization that either the strategy is wrong, or what you are doing is wrong. Something needs to be fixed.

If you do not have a strategic plan or you do but it if it does not influence anyone or anything, then something is wrong.

The first question I ask as a consultant is, “Why are you doing this?” The correct answer should link back to the organization’s strategic plan. (e.g., “We build these widgets because it allows our customers meet their needs, which is our purpose outlined in our mission.”)

Overcoming the Reasons Not to Strategically Plan

Recently I read a couple articles on Yahoo Voices on why firms should skip strategic planning (Morningside) or why strategic planning is a waste of time (VanAmee). That prompted me to do a little more research into the subject and identify the reasons some think strategic planning should not be done (Reynolds). That finally drove me to write this blog.

In a future article, I plan to discuss when a company really needs a strategic plan and when they do not. Sometimes, a company is in so much trouble that they need a crisis action plan and they can focus on strategic planning when they get through the crisis. This section; however, relates to why companies feel they don’t need a strategic plan at all:

1. Overcoming the bad taste in their mouth. Face it, not only have I seen, but I helped create many strategic plans that do nothing but collect dust on a shelf — what I refer to as “shelfware.” I have worked with many organizations that have been bit by the “planning bug” too many times and they are downright sick of it. You hear them say things like, “This is just another management fad,” or “We’ve tried that before and it didn’t work.” Let me tell you — the reasons you tried it before is because you needed it then and you need it now. The problem is the way you developed the plan was flawed and it was no good, or you failed to implement it — chances are, both of those reasons are correct. Get yourself a professional and invest some time and money in solidifying your company’s future. That means dedicating resources to planning year-round, not just once.

2. The belief that strategic planning is a waste of time and money. This excuse always kills me. I talk about this in my previous blog on the importance of strategic planning. Planning is about preparing yourself for the future…about thinking ahead. If any organization thinks that it can operate by the seat of its pants and stay in business, this would be why 7 out of 10 small businesses fail. It costs an organization a minimum of 25% more money to react to an unplanned situation than to plan for and be ready when the event happens. In rework alone dealing with a crisis, the cost can destroy a company.

3. It is not the right time or we are alright. Every organization should have a strategic plan, they should review their progress regularly against that plan, and they should update that plan annually. If you are alright now, then now is the best time. The speed of change in the world today is so intense that any organization that sits back on its laurels and thinks it is doing ok is about to be out of business. The proverb, “There’s no time like the present,” seems to fit right here.

4. Fear of change that comes from strategic transformation. Strategic planning means changing your organization. You determine where you are, develop a vision of where you want to go, and lay out a plan to get there — transformation. The official term for fear of change is Metathesiophobia. This fear can severely reduce one’s will to continue in life; sometimes one may feel like they have no control in life and may want to end it. Those with this fear constantly look back on the past and wish it would come back, but know it will not; they are willing to do anything to go back and tend to fill themselves with false hope or lose faith in life. If you do not think this is real, read “Who Moved My Cheese.”

5. We are just too busy to plan right now. Excuse me, but there is a reason for that. You are too busy right now because you have not and are not planning, thus you are running around like a chicken with your head cut off. Good strategic planning will help you overcome the “we’re too busy to do anything productive” syndrome.

6. Developing a plan is too much work. Strategic planning, just like proper education and training, quality improvement, etc., will always be “work” for a company. Too much, would be because of an over-emphasis on the planning process. Having someone conduct an organizational assessment and taking a day or so once a quarter to emphasize the direction of the organization is nothing to the results you will gain. All too often, planning becomes a “get around to it” type of thing, when it should be the most important thing leadership does — they set the vision and evaluate the organization’s progress achieving it. Along the way, they adjust their effort and resources to continue to move closer to success.

7. People are rewarded for the wrong thing. Have you ever worked in an organization where people were rewarded for crisis management and those who planned and prepped were not? This type of attitude breeds a culture of “fire fighters” not planners. This will encourage an organization full of people who cannot look past six months on a schedule and are always fighting to get deadlines met. Soon customers will start leaving, budgets will dry up, and the company will fold.

8. We are fine; we do not need a plan. This is especially true of small or overconfident businesses. Many small businesses think strategic plans are only for large companies and they do not need one yet. Talk to some of your mentors who have big businesses now and see how they started — they planned. Business will grow if you have the right mix of things like product, demand, and placement. But have you thought about how you will grow? Some companies think they are doing just fine without that “holy plan;” however, the environment has a way of changing and if it is not evaluated and monitored, it will catch you when you least expect it. Big or small, effective or not, everyone needs a strategic plan and continuous strategic planning.

9. We built a plan and it is fine. Congratulations! Having a strategic plan is a great first step. The importance of it has been recognized; however, how good is it? How often do you look at it? Does anyone even use it? Strategic plans can be pretty and used as a marketing device, but must be living and constantly reviewed and updated. Every organization will start with a very basic plan and if it is constantly reviewed in a professional manner, they will improve and refine it over time. Just because you have one, does not mean you are done.

10. No one can plan for the future. Unless you have a psychic or soothsayer on your staff, then you are right, no one can predict the future and plan for it. What good organizations do; however, is identify the potential threats and opportunities they face with their best guess and take steps to put measures in place to prevent the future from negatively impacting them. Examining potential actions against your current strategy and determining if they fit, sometimes prevents a company from making unwise and risky decisions. It is the whole, “Look before you leap,” philosophy. If we all had crystal balls, then everyone would be rich and their businesses would run perfectly — since no one has a crystal ball, the next best thing is a strategic plan.

Plans come in all shapes and sizes. Your organization probably already has a few or more that people have created (formally or informally). The most important plan for every organization; however, is a Strategic Business Plan — normally just called the strategic plan. Do not be fooled by other strategic-level plans — there is only one strategic plan and it trumps all others. There is no solid reason why any organization should not have a good strategic plan and implement regular strategic planning activities. Some reasons might sound convincing at first, but in the end, having a strategic plan is key to organizational prosperity.

The Importance of Strategic Planning

Strategic Planning Think Big December 26, 2011 8 Comments

Proper Strategic Planning is the Most Important First Step for Any Organization

Strategic Planning is a structured and systematic process, where leaders of an organization establish the vision of the organization’s future and then develop and implement the actions necessary to achieve that future. This article expands on the strategic planning concepts addressed in Think Big, Take Small Steps and is designed to help you achieve success in your strategic planning process.

You hear a lot of rhetoric these days about the importance of strategic planning, but seldom can anyone provide any concrete return on investment data from such planning. The reasons often presented; however compelling, leave the business owner asking, “So what?”

On the surface, these are some of the typical reasons why hundreds of books and articles say strategic planning is important:

Improves performance
Provides direction
Provides high quality services
Optimizes resource allocation
Meets accreditation and regulatory requirements
Maximizes chances for success

Let me start by saying that “effective” strategic planning will have a positive effect on any organization, but it is not the answer in all situations or to all the organization’s problems. Do not think that strategic planning is a “magic pill” your business can take to get better; however, businesses without strategic planning tend to fare far worst than those with.

Many companies, large and small, choose not to develop strategic plans. M.C. Morningside highlights seven of these traditional reasons in his article. Lee VanAmee, in his article, highlights why some organizations may feel strategic planning is a waste of time. The bottom line is there are three very big reasons why all organizations should have robust strategic planning. These three reasons clearly demonstrate why strategic planning is important.

Failing to Plan is Planning to Fail

According to the Department of Commerce and the Small Business Administration, 7 out of 10 new employer firms survive at least 2 years, half at least 5 years, a third at least 10 years, and a quarter stay in business 15 years or more. In the book Small Business Management, Michael Ames cites eight primary reasons for small business failure: lack of experience, insufficient capital (money), poor location, poor inventory management, over-investment in fixed assets, poor credit arrangements, personal use of business funds, and unexpected growth. All of these problems and many more could be mitigated with an effective business strategic plan.

You would not build a house without laying a strong foundation first, so why would you start a business without ensuring that it had a solid foundation as well. When the soil shifts under your wonderful new home, cracks start to appear in the walls, doors do not close correctly anymore, and eventually the house could collapse entirely. A business started without a strong plan, which addresses the primary small business threats, could end up in the same heap of failure.

If it is so important for a small business to have an effective strategic plan, what makes the large firm that has been around for 20 years any different? They face the same challenges as a small business, just on a grander and broader scale. Going in the wrong direction in a business that deals in millions versus thousands can cause any large organization to fail just as quickly if not quicker.

Direction and Inspiration to the Workforce

Have you ever worked in a company where you had no idea what the company did or how you fit into it? This is more common than you may think. One of the largest intrinsic reasons employees’ demonstrate strong organizational commitment is that they feel like their work matters. Everyone wants to be part of a winning team — look at the fans of winning sports teams. However, what really keeps fans coming, even in a losing season is that they feel like their support matters to the team. This organizational purpose is highlighted and defined in the organization’s mission statement — a very important part of the framework of a strategic plan. This mission reminds the organization, its leadership, and its employees of the organization’s direction and purpose.

Inspiration is what drives and motivates employees even in the dire times. This inspiration is provided through a well-designed vision statement — another key element of the strategic plan. Lofty and unmeasurable vision statements like, “Being the best,” may look good on paper and give leaders a warm feeling, but seldom inspire employees. The fact is if the vision seems impossible to ever achieve, then it will probably work to demotivate employees.

As highlighted in the five primary reasons strategic plans fail, in Think Big, Take Small Steps, not developing an effective strategic framework hamstrings your strategic plan before you ever try to implement it. If you want to provide direction and inspiration to your workforce, take time to develop a purposeful and everlasting mission statement and an inspiring and far-reaching vision statement.

Responsiveness to Change and Elimination of Rework

Picture getting in your car for a cross-country trip to visit friends. Would you plan what you needed to pack, the route you would take, where you would stop along the way, and how much money it would take? Of course — if you did not, chances are you would run out of money, get lost, and be wearing the same clothes you started in with never arriving at your intended destination. To understand the value of strategic planning, you must understand the impact without it.

The value of strategic planning is related to time. You reduce your time through proper planning — only thinking a few weeks or months out — otherwise costs escalate exponentially because of last-minute actions and constant rework that occurs due to mistakes based on quick decisions. Strategic planning is like planning for that cross-country drive — it gets you “ahead of time” and saves you loss of productivity and money in the long run. Failing to plan can spell disaster for an organization that goes in the wrong direction.

Many organizations will find a plethora of excuses why they think they should not plan. Literature by the droves tells us strategic planning is important; however, if you want your business to succeed, if you want to drive organizational commitment in your workforce, and if you want to operate effectively and efficiently well into the future, strategic planning is for you.

Looking to learn more about strategic planning? The Association for Strategic Planning (ASP) is a non-profit professional society whose mission is to help people and organizations to succeed through improved strategic Thinking, Planning and Action.

Related Links (find three links related to the topic of the article):

1. http://www.strategyplus.org/

2. http://www.sba.gov/