Posts tagged SWOT

Building a Strategic Plan from the Bottom Up

Strategic Planning Think Big May 10, 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.

A Successful Systematic Process to Apply at Your Strategic Offsite.

How many of you attended, participated in, or facilitated a strategic planning session where you started with the mission and vision and then went around the table coming up with goals that every felt the organization needed?

FAIL!

Welcome to the world of the Good Idea Group. Where leaders come up with things they think they want to work on and everyone gets assigned a goal so everyone is “part of the strategic plan.”

If you have been or are doing this, you are going to build a strategic plan without an Executable Focus and you will undoubtedly become one of the 70% that fail at achieving desired results.

The bad thing is that I have done this too! Yep, I, even as a leader of organizations, have created plans built this same way.

Want to break this mold?

What to walk into a strategic planning session and walk out the end of the day with the best strategic plan possible?

Want everyone who attended the offsite feel like this was the most productive time they’ve ever had planning?

Want a plan the makes sense and is easy to implement?

If you answered yes to those four questions above, than this blog is for you. As part of Leading Your Leaders to Develop an Effective Strategic Framework, this blog specifically describes how to build a strategic plan quickly, efficiently, and effectively. You will find this technique is applicable to anything you are trying to solve. Ready for this?

I Certify, that if you follow this approach, you will create a strategic plan with a solid executable focus that is designed to overcome problems in your organization and leverage your strengths and opportunities. The resulting plan will, without a doubt, be fully implementable and you will always know why and how every action supports the vision of the organization.

Imagine this (above) as your company. You have a Mission (where you are today) and a Vision (where you want to be in the future) that you have validated during the first part of the offsite–we discussed this in the last blog, Facilitation of an Effective Strategic Plan Offsite. Between the mission and vision, there is a raging river that prevents you from getting to the river. What you need to build is a bridge that connects the too so you can actually get your organization to the vision.

The troubled water between the two banks was outlined by your organizational assessment that we covered in the How to Conduct an Organizational Assessment portion of this blog. This is what you must overcome–what is in that water are the things that prevent your organization from reaching its vision. However, scattered here and there in the river are low spots and rock outcroppings that help you in your journey of building a strong bridge to you vision.

If you keep this analogy in mind, you will easily understand this approach–as a matter of fact, I show a similar slide on the board to kick off this part of the offsite with their mission written out on the left and their vision written out on the right. During the offsite, I cal these series of exercises “What We Need.”

This exercise happens in three parts:

What We Need…
Diagramming…
Ownership…

What We Need

At this point, we have reviewed the Organizational Assessment and finalized a solid Mission and Vision Statement (I will talk more about these in upcoming blogs). I normally send everyone on a break and then I update the appropriate slides for the next section.

When everyone comes back, we review the high-level SWOT assessment, which encapsulates pretty much what is going on in the organization. I might refer to white boards or flip charts where specific items where added. This refreshes everyone’s thoughts on what is happening. Then I bring up the bridge slide with the new mission on the left and new vision on the right. At the top of the slide is the statement, “What we need…”

I give the team (normally) 60 minutes to silently finish this sentence:

What we need to achieve our vision is…

I ask them to write each thought down on a 5×7 post it note. The statement should be a concrete thought like “professional development training for all levels,” not something simple like “training.” They have 60 minutes to silently brainstorm ideas to finish this sentence.

Each idea should be focused on overcoming the challenges the organization faces today and leveraging what’s good.

I like to have two or three people working with me at this point. One or two go around and simply pick up the post it notes and bring them to me. I then start arranging them as they come in into group using affinity diagramming. I stick them on the wall in their groups. Sometimes I use a large white board or I hang empty post it butcher block paper around the room and organize the groups that way.

As you can imagine, this can be a fast and furious activity, especially if the leaders are strong thinkers. You can quickly generate hundreds of ‘what we need’ ideas.

Once everyone appears done, or at the 60-minute mark, I stop the exercise and put everyone on break. While they are on break, I get the helper(s) to review my groupings and help me finish them up. At this point, this is my affinity diagramming–not theirs.

Diagramming

When everyone is back from break, the first thing I like to highlight is the number of strategic ideas they came up with (number of post it notes) to achieve their vision. This number is normally well into the hundreds and is always impressive that in an hour or less, they could come up with so many ideas.

Then I explain how I have organized their ideas on the wall. Note that I don’t talk about group titles or anything, just explain the process I used. Several times the executives I work with have never seen affinity diagramming at work–many have never even heard of it.

By the way, this approach has been so effective with organizations that many executives have asked me to help them apply the same technique to many other types of projects.

For the next 10-15 minutes (or so), I ask the team to come up to the board and review all the ideas and validate the grouping. They are free to discuss and move anything on the board, but they cannot remove any idea–all ideas are valid at this point.

Once they have agreed on the final groupings, we walk through each group and discuss the items–I normally read them off. Then I ask them to label that group with a name. After all the groups are named, I ask them if any of the groups are similar in nature and could be grouped into a larger group–this is what is called tree diagramming (grouping the groups).

Once the final large groups are done, I step back and point out that they have just come up with their strategic plan. They have their Goals–the large groups, Objectives–the original affinitized groups, and the Actions–the ideas on post it notes.

It is normally at this point that every executive in the room is so amazed that they have created so much and done it in under two hours!

Of course, the plan needs work by me, but everything is there. My next job is to write it all up in a structured document. But the plan is now theirs! It was their ideas and their groupings, all i did was facilitate their thoughts in a beneficial direction to achieve their vision. This breeds ownership of the executives of the plan.

Ownership

The next and final step (normally) is for you to strengthen the ownership of the plan in the executives. List out the goals (hopefully you have between three to five at this point) and pose to the group, who will own each of these Goals. There should be one owner for each goal. I have seen where they have multiple owners, trying to give everyone ownership, but that fails, because it gives leaders an out when you share the accountability. Everyone will end up being involved in implementing the plan, but right now, you simply need accountability for each goal resting with one throat to choke.

This is a point where you would hope that the senior leader of the company would weight in (I normally prep him or her before hand) and make a determination after discussion.

The end result…

You have just created a new mission, vision, goals, objectives, and actions in one day following this approach. The executives at this event will be amazed at how simple and effective the process was and can definitely see the value of the strategic plan.

Your next step, outside of the offsite is to bring it all together in a concise document for them to review. I normally put this together in a detailed PowerPoint after action review that talks about what actions took place, what additional information was learned along with the SWOT, the final mission and vision with the goals between them marching across the bridge left to right (often referred to as the bridge slide), and a slide for each of the goals with written out objectives. backup i have all the ‘what we need’ statements on slides aligned to their appropriate goal and objective.

This after action report take a week or less to put together…sometimes I can have it done the next day. Most of it I build before the event and simply fill in the data after the event.

Following this approach is fast, efficient, and effective. You will be recognized by the leadership for one of the best planning offsites they have ever been to, and you will have a rough strategic plan built with a solid strategic framework and executable focus. The next step will be to translate this strategy into execution.

Over the next few weeks, we’ll discuss some of the finer points of products from the strategic planning offsite. we will look at:

Scenario Planning
Mission Statements
Vision Statements
Values and Principles

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.

Application of Scenario Planning in Strategic Planning

Strategic Planning Think Big March 8, 2014 3 Comments

How Using Various Scenarios in Building Your Strategic Plan Helps.

“What-ifing” your current strategy or your strategic thoughts are a great ways to look for holes in your current strategy or the strategy you’re building–or both. I often use scenario planning–also referred to as “war gaming”–to get leaders to examine before they decide. It’s kind of like taking the strategy out for a test drive without putting a lot of miles on it before you buy it.

Why…

Strategic planning, more than anything else, is positioning yourself strategically to take advantage of a predicted or possible turn of events. It’s more about preparing a company for the future versus putting something in place. Today, your organization has constraints that prevent it from achieving its vision and these need to be overcome, but many of these constraints might not exist today. Scenario planning allows you to recognize threats (even the invisible ones) as opportunities and be strategically prepared to adapt to them if they occur, while still moving steadily toward your vision.

When an organization has a solid strategic direction and is moving in that manner, things may appear to occur happenstance. However, in reality, the organization is preparing for opportunity to knock and they’re opening the door quickly to it. Without an effective strategy, the door will open and you’ll be unprepared. The door will open one way or another.

Some organizations, especially extremely large ones might have elaborate war games designed that really help executives envision the future. I recommend these being designed by firms that specialize in this type of activity. For smaller organizations, or ones that are really new to strategic planning, this blog can really help design effective scenarios that help build solid strategic plans.

Scenario Planning–the “planning part”–is done at the tail end of the Organizational Assessment. The application of this tool is actually in the strategic planning session that I will talk about in the coming weeks. There are two ways that I apply scenario planning and it’s based on the organization (note: I don’t always use scenario planning). The two situations are as follows:

The organization doesn’t have a true strategic plan at this point.
The organization you’re working with is pretty new to the concept of planning. They might have a mission and vision that they’ve come up with, but there really was little thought behind it and that’s about as far as they’ve come. In this case, I normally use scenario planning to help them think strategically about the opportunities and threats they face as an organization. Obviously I pull this information from their Robust SWOT Assessment that I talked about last week. This is more along the lines of a “what if” analysis (i.e., If this were to happen, what would you have to do about it). This tests their current environment and helps them think through organizational gaps and what would need to be done about them.

The organization already has a defined strategic plan.
You may be working with an organization that has taken some time, or a lot of time, to examine and develop their strategy. If I’m coming back a year or so later to help examine the organization’s strategic plan that I helped build and then update it, I use scenario planning to validate their current mission, vision, and goals, based on the Robust SWOT Assessment. In this realm, it’s focused on answering, “Does what we have today hold true in these possible future states,” versus, “What do we do about it?” The goal is to ensure that the key aspects of mission, vision, and goals for the organization are still valid and lasting, even if something strange, yet possible happens.

So, let’s talk about what scenarios look like and what they don’t look like. First and foremost, we’re not talking about some fantastic and non-plausible what-if scenario like extraterrestrials beaming into the lobby to say hello. Scenarios have to based in a possible and plausible reality, but isn’t happening today. They can be both positive or negative and in many ways, even positive scenarios can be a risk to a company that isn’t strategically prepared.

When doing scenario planning, try to come up with five ideas and then get the leader of the organization to whittle them down to three. Three fit nicely on one PowerPoint slide and three can effectively cover what you need leaders to think about. The purpose of the scenario planning activity is to drive discussion around whether the organization is prepared and/or if the current strategy needs to evolve. The actual scenarios should come from the organizational assessment and specifically the SWOT. Following are some ideas and examples of potential scenarios:

Natural Disaster. I worked with a housing privatization program that was providing long-term leases to developers to build and provide back housing to military. Part of their program involved a “lock box” that set aside monies for upgrades and improvements. Several of these privatized communities existed along coastal areas that could be susceptible to a natural disasters, like a hurricane. The threat of this occurrence had been mentioned more than once in interviews, so I had the leadership discuss how truly prepared they were for another Katrina-like hurricane, which significantly damaged several communities at once. It allowed them to examine their risk mitigation structure, their lock box strategy, and evolve their approach as a result of their strategic plan.
Government Interaction. Most (if not all) organizations are impacted by government regulations and more and more these cause challenges for companies. Specifically, financial and environmental regulations can challenge the status quo of any company. Those that are normally impacted, are adequately dealing with the “now.” In scenario planning, you could consider throwing in a government regulation curve ball that really changes the operational landscape and see if they are prepared for these types of changes.
Growth or Decline. Often we think commiserate over the potential quick loss of customers and market share, but quick growth can be just as difficult for an unprepared organization, even though it might seem like a good thing. Unpredicted growth and decline scenarios make the leadership think about how they will deal with this possibility and if they have the right strategies in place. Of course, I make these scenarios as realistic as possible, based on what I have learned in the assessment.
Budgetary Constraints. Every organization deals with budget issues, especially if you’re working as a subset of a bigger organization. A perfect storm example would be the result of the Troubled Asset Relief Program (TARP) and the Affordable Care Act (ACA) on government budgets. Organizations that didn’t strategically plan for this, say four years ago, now are being caught unprepared as things like sequestration and government shut downs occur. Those that looked at their crystal balls four years ago could have been planning to absorb the potential funding impacts through strategic positioning and planning.
Mergers and Acquisitions. I don’t care how good or bad your company is doing, this can almost always be a threat. If you’re part of a bigger organization and there is redundancy, then the threat can be very real. In today’s world, if I were working with say a governmental support service organization, I would definitely be examining the possibility of all military and government support services merging into one organization. This happened with the Defense Finance and Accounting Service (DFAS) back in 1991. With today’s push to downsize and cut, these types of mergers are very likely. Basically, if your operations has any redundancy or is aligned with another part of an organizational process, consider yourself at risk and scenarios can really help leadership think through the threat and possibly turn it into an opportunity.
Employee Turnover. An increase in employee turnover because of a lack of engagement or due to a highly tenured staff, will always impact an organization. If you are at threat because of these factors, things like single points of failure become a significant threat. If you have poorly documented knowledge, then training will be an issue. Aggressive hiring with a quick turn over can be costly and really slow operations. Obversely, an organization that experiences high turnover and suddenly sees a drop, can experience different issues.
Sourcing Decisions. What you do today might be ripe for outsourcing, or you may have all your outsourcing eggs in one basket. These types of threats are much more prevalent today than ever. Also, you may have outsourced too much and your culture and focus on the customer is starting to slip. All of these things can lead to some pretty interesting leadership discussions.

As you can see, there are many things that you could discuss as long as you have done your organizational assessment homework. Just coming up with fantastic scenarios without understanding the current situation won’t really be helpful to leaders. These were simply examples of ones that I’ve used before–there are many other possibilities.

One of the important and difficult things about scenario planning is that it will probably make leadership uncomfortable. You’re probably highlighting a risk that they would rather ignore. Good strategic plans put all the issues on the table and require intestinal fortitude of leaders to openly examine and prepare. This tool helps them make the harder decisions.

The bottom line to scenario planning is that it is a tool for the organization to prove or disprove their current state and then decide what to do about it. I present it for discussion near the front part of the strategic planning session, but I build it here in the organizational assessment phase.

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:

Walmart Advanced Vehicle Experience (WAVE) concept truck

There is no “box” at Walmart

Meandering Genius Strategic Planning March 5, 2014

Have you seen the new Walmart Advanced Vehicle Experience (WAVE) concept truck that is powered by a prototype turbine-powered hybrid engine with a trailer made almost exclusively with carbon fiber, which saves 4,000 pounds?

This is Strategy at its finest and has the world’s number one retailer leveraging their strength–their logistics network–and turning it up a notch.

Clearly Walmart was thinking way out of the box in designing this new semi truck–in fact it appears that they threw the box out in the trash. Walmart isn’t in the truck building business?

True strategists look outside their realm and outside of what they do today as well as looking at what they are good at. Recently I talked about the SWOT Assessment and had a lot of “know it all” input from fellow strategists saying that a SWOT is this and a SWOT is that. Ladies and gentlemen, see the result of a great application of strategy based on a SWOT. This is why I highlighted some simple tips for you to start using a SWOT effectively.

Heavy-duty trucks spend more time on the road than passenger vehicles, so improving their efficiency can have a major effect on emissions–and their owners’ bottom lines. That’s why Walmart is getting into the truck-design business with the WAVE. With its aerodynamic cab, the WAVE certainly doesn’t look like any other large truck currently on U.S. roads and doesn’t operate like one either.

Walmart’s design was achieved in part by placing the driver in the center of the cab. The steering wheel is flanked by LCD screens–in place of conventional gauges–and there is a sleeping compartment directly behind the driver’s pod. The WAVE features a range-extended electric powertrain, consisting of a Capstone micro-turbine and an electric motor. To reduce weight, the entire truck is made of carbon fiber–including the trailer. Walmart says this is the first example of a carbon-fiber trailer ever produced, and that its 53-foot side panels are the first single pieces of carbon fiber that large that have ever manufactured. Like the tractor, the trailer was also designed for optimum aerodynamic efficiency. It features a convex nose, which not only reduces aerodynamic drag but has the added of benefit of increasing cargo space in the trailer.

Take that Peterbuilt and Freightliner! Ha! And I thought the MAN Super Streamlined Semi-Truck was cool. The MAN was designed by truck manufactures, not a super store retailer!

I’ll say it again; use your strengths to overcome your weaknesses. Then turn threats into opportunities. Walmart is known for their distribution system–it is what makes them Walmart and it is their biggest strength. They focused on the threats to that strength and turned it into opportunity. This is a perfect demonstration of a SWOT in action.

The Robust SWOT Assessment

Strategic Planning Think Big March 1, 2014 3 Comments

Taking SWOT Assessment to the Next Level in Strategic Planning

It was probably back in the early 90s that I first heard of the term SWOT Analysis / SWOT Assessment. I started to hear about it a lot more when I was in Germany from 1997 to 2002. The acronym was the easy part, but actually building one was, in my mind, difficult.

Now some of you out there might have never had difficulty with building a really good SWOT, so this blog really isn’t for you. However, if you are currently challenged by this tool and developing what you really think is a good SWOT, then this blog is for you!

I welcome input from those who have other techniques and experiences for getting to a great SWOT.

I call it an Assessment tool, versus an Analysis tool as it’s commonly referred to. It’s part of your Organizational Assessment as I talked about in Understanding the Different Assessment Tools, or at least should be, and can be part of any effort to examine the current state of something. I’ve since used SWOT in communications studies, marketing plans, etc. We will focus on its use in strategic planning.

The first thing that really propelled my thinking is that the SWOT is actually a high-level representation of a much deeper analysis. It’s really more of a way to capture organization’s themes and present them for further discussion during the Strategic Planning Session, which is the next stage of strategic planning as outlined in Think Big, Take Small Steps.

I have seen some very poor examples of a SWOT and even created several in my own time. If you are using brainstorming (personal or as a group) to build your SWOT, you’re going to end up with a poor SWOT Assessment. The key is to align the results of your assessment interviews, like I talk about in Assessing Your Organization Using the Military’s DOTMLPF – FREE Assessment, and build the SWOT off a more robust analysis using Affinity Diagramming. I use Affinity and Tree Diagramming a few times as I help organizations build their strategic plan and will discuss it in later blogs as well.

Understanding the design of a SWOT Assessment is the first important part. There are many key aspects of a SWOT that are not as obvious as the words would lead someone to believe. What I want to talk about is not only the four vectors, but how the tool was designed and how to use the tool moving forward. See the image below as we discuss:

As you can see from the image, things are either positive or negative in nature and either internal or external to the organization. Positive aspects are what an organization can leverage to overcome negative aspects. Internal aspects are those they control and external do not currently reside within the organization’s control. Note that something can be more than one thing (i.e., Employee longevity can be a Strength because you have a low turnover and a great deal experience, but also a Weakness because the employees might be resistant to change and you might have a large wave of retirement coming).

Strength. Strengths are internally positive aspects about the organization. These are the things that make the organization strong and are the main things an organization can leverage to overcome internal weaknesses and external threats. Organizations tend to focus only on their weaknesses and take their strengths for granted. A failure to focus on and nurture your organizational strengths can quickly turn them into a negative. When you brainstorm to build a SWOT, you tend to come up with a lot of perceived strengths, some of which might not be true.

Weakness. Weaknesses are also internal to the organization, but these are the challenges that could prevent the organization from achieving its eventual vision. Only the most glaring weaknesses are normally highlighted by an organization when brainstorming and usually this list is short. When done correctly, this tends to be a long and difficult list for leaders to swallow. Although it doesn’t sound like SWOT, I often refer to this box as Challenges (a SCOT). Nothing in an organization will prevent it from achieving its vision, unless they fail to address the challenges in front of them.

Opportunity. Many times Opportunities and Threats can be the same thing, but simply it’s the way you look at them. Basically, these both fall into a risk category. Opportunities are positive and external to the organization. If you have an opportunity that exists within your organization, then it is a Strength that you just aren’t leveraging at the moment. The importance of focusing on the external factor of it is that there is less of a guarantee that you can turn Opportunities into Strengths. Many organizations, especially those that don’t currently have a strategic plan or the one that exists is poor, fail to focus on the external factors. Extremely effective strategies focus more on the external factors then the internal. This is how you develop strategic positioning and become prepared for the what might happen versus dealing with it when it happens.

Threat. Obviously, Threats are the external negative aspects surrounding an organization. These are significant threats that the organization faces or could face in the future that they have no control over. Competitors and government regulations often fall into this category. If your organization is part of a bigger organization, things like down-sizing, reorganizations, and funding, even though they exist in the greater organization, still can be external to your control. The two biggest things about Threats is to determine ways to either turn a Threat into an Opportunity, or to develop a mitigation plan should the Threat materialize.

As you can see, the SWOT in itself isn’t really an analysis tool…it’s a way to display what you have learned in your assessment so that leadership can review it and discuss it. I have put them on separate pages before, but its best that leadership can see them all on one page and thus compare and contrast in discussion. This is why a good SWOT really is only a high-level view of what’s going on in and outside of the organization.

So, this is how I build a robust SWOT Assessment:

1. I gather all the findings that I collected in my assessment interviews and research. Refer to my earlier blog, Assessing Your Organization Using the Military’s DOTMLPF – FREE Assessment, for my techniques in interviewing. At this point you simply have a lot of detail–detail that you (and your team if you have one) need to completely read through and understand.

2. What I do is look for themes that form out of the comments and responses from the interviews and from that were gathered from my research. I use Affinity Diagramming to group these items–I will discuss this more in the next phase of my blog under Leading Your Leaders to Develop an Effective Strategic Framework, but for now, let me highlight how I do this. Normally I start with pen and paper and list out high-level groups of the information I have. Then, I transfer this to a Microsoft Excel spreadsheet, putting the grouping titles at the top of each column. Then, I copy the information I’ve collected in rows below the appropriate column headers and I allow for information to end up in more than one column. This is an individual (not group) method of doing Affinity Diagramming.

3. These column headers and all the information listed in the rows below the columns are what I call Trends, Issues, and Problem Statements (TIPS). When working with the Army, I referred to them as Emerging Insights. You could also call them Strategic Focus Areas–it really doesn’t matter. The importance of this is that you have a great deal of detail under each major heading to really explain what is going on both positively and negatively in the organization. The TIPS heading and major themes within the TIPS are what form the words on the SWOT Assessment chart. Now you can see why a SWOT is a high-level tool.

The purpose of building the SWOT Assessment is not to analyze the organization–this is why I don’t call it a SWOT Analysis. This is a high-level assessment of the deeper analysis done in the TIPS. The SWOT is a primary tool used to facilitate discussion during the Strategic Planning Session, which we will discuss in five weeks. There are still four more important topics that I want to expand upon during the Organizational Assessment. They are Scenario Planning, Innovative Thinking, Measures, and Audience-Focus. The reason I focus so much on developing the Organizational Assessment, is because if done correctly, you will really make your Strategic Planning Session go smoothly.

A SWOT in itself is not a really great tool. If you understand it and develop it correctly, it can be extremely effective in leading discussion during the Strategic Planning Session. Simply sitting in a room and brainstorming to build a SWOT will lead to a useless document. You will end up with very limited information that is heavily weighted on internal and positive aspects. A true SWOT must come from a detailed analysis of the interviews and research done in the organization.

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. I love Dr. McDonald’s “SWAG” http://youtu.be/V6NhsoVSD88 – MUST WATCH

2. http://www.mindtools.com/pages/article/newTMC_05.htm

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