The Fundamentals of Strategic Planning: Key Issues Decoded

Today we’ll examine the concept of “strategic planning,” which is (or should be) an integral part of any business operation, regardless of its current size, scope, or industry vertical. In this “flattened” and highly competitive world, a business cannot take for granted that past successes will continue to be replicated, or that its competition is limited to a particular geographic boundary. We live in a world in which businesses, and the leadership and workers that staff them, must be constantly evolving and adapting to new realities, market pressures, opportunities and the like.

Strategic planning all too often tends to either be ignored or devolves into an abstract, academic exercise in which a company (or even an individual), in a furious burst of energy and attentiveness, and often with the expenditure of not insignificant amounts of capital, generates some fine ideals and theories, but fails to follow through and actually put into practice the information gleaned from such effort. This is wasteful and yet another example of the creative entropy which the Zentropist must re-focus and put to constructive use.

Over the past few years, I have found that many clients and prospects, regardless of the stage/maturity of the business, struggle with the definition of 9 key components that are necessary to either update an existing Business or Strategic Plan (not to mention other related collateral) or to create one for the first time. I’d like to briefly explore these issues, offer some suggestions, and hopefully provide some clarity on how this process can be managed in an efficient fashion.

Although I sometimes prepare a Strategic Brief as a prelude to development of a full-blow Business Plan or Strategic Plan, I have also found this exercise to be extremely helpful and revealing as a “reality check” when working with an existing business. For example, I will assign key stakeholders in the business a worksheet which they are to fill out without consulting with their colleagues in an effort to determine if everyone’s vision or understanding of the business is aligned or not. More often than not, I find discrepancies, sometimes fairly significant ones, which signal to me that the business needs to improve its internal communication protocols and to re-align or otherwise define core fundamentals if it hopes to improve performance.

The nine (9) key issues that we focus on are:

  1. SWOT Analysis
  2. Management Vision
  3. Mission Statement
  4. Corporate Values
  5. Business Objectives
  6. Primary Goals
  7. Secondary Goals
  8. Key Strategies
  9. Strategic Action Items

In addressing the issues above, a company is forced to define and decide mission-critical, substantive concerns that directly impact its ability to coherently and efficiently operate, much less execute any sort of plan.

SWOT Analysis: This concept should be familiar to many, as it is shorthand for evaluating the Strengths, Weaknesses, Opportunities and Threats facing a business or individual. As part of this exercise, it is useful to try to settle into as objective and non-emotional a mindset as possible, and to be completely honest in your assessment. Also remember that according to the Yin/Yang principle underlying all things, depending on perspective, a “strength” can also be exploited by another and turned into a “weakness,” and today’s “weakness” can be addressed and transformed into a strength. Furthermore, today’s “strength” may become tomorrow’s “weakness” due to its failure to change with the times or lack of dedicated practice and effort to build upon its foundation. Likewise, the window to exploit “opportunities” can fast close, and may or may not come again. And while some “threats” are obvious, some perhaps are less so, and it is a wise idea to explore how your own “strengths” and “weaknesses” might be turned against your business by a clever competitor.

Management Vision: Truthfully, companies can get hung up on differentiating between a “Vision Statement” and a “Mission Statement,” and sometimes this distracts them from the real concerns of operating the business. Still, if management cannot clearly articulate why the businesses exists and what the “big picture” dream or purpose is for putting in the blood, sweat, tears and capital, there is something fundamentally wrong with the corporate leadership.

Mission Statement: Many pundits will state that a mission statement clearly needs to articulate the following: the purpose of the organization; who its clients and other stakeholders are; the responsibilities that the organization has to clients and stakeholders; and finally, an explanation of the products and/or services offered. This isn’t bad advice by any means, but it can lead to long, rambling and unfocused statements that really do not resonate with those charged with carrying out the mission. In my opinion, the best mission statements clearly define why the business exists, what it does, and who it does it for in as concise a manner as possible.

Corporate Values: Organizations have values, even if they are never articulated, because these are expressed everyday in the actions and behaviors of both its rank and file and management. If you care about the image that your organization conveys, or truly want to stand out from competitors, it is well worth your time to not only define what your values are, but to put these into practice in all of your interactions.

Business Objectives: Generally speaking, in the for-profit world it’s understood that your business exists in theory to make a lot of money for its stakeholders (unfortunately, in this day and age this sometimes conflicts with the interests of all stakeholders, more often than not sacrificing those outside of management’s hallowed halls or even public shareholders for the benefit of management despite fiduciary duties). However, some businesses actually have more noble objectives as well, and articulating these and ensuring that they are met (while hopefully generating profits in an ethical manner) is very rewarding.

Primary and Secondary Goals: In order to measure the achievement of your stated objectives, you need to set quantifiable goals (ideally ranked in order of importance, which may change over time) against which your progress can be gauged. It is equally important to be able to differentiate between goals which are of primary concern, and those that are of lesser importance in the “grand scheme of things.”

Key Strategies: Once you have clearly stated your objectives (based on the vision, mission statement, values and SWOT analysis) and classified goals according to relative importance, you are in a position to actually determine possible strategies to achieve the desired results. Strategies cannot be developed in a vacuum, and should not be inflexible, and the tactics used in pursuit of these strategies must be carefully considered and malleable, because in my experience, if the defined strategy or strategies are legitimate and truly achievable, it is the tactics which first require adaptation before completely jettisoning the strategy as “unworkable” or no longer relevant.

Strategic Action Items: Ultimately, when you complete the Strategic Brief, you should be able to develop a list of actionable items that will enable your business to transform theory and conjecture into practice. This could range from developing certain written deliverables to reducing or increasing internal meetings or revamping internal processes to hiring an outside party to help you achieve the results that you need.

In summarizing all of the points above, we can begin to identify such jargon-laced concepts as your company’s  “unique selling proposition” (USP) which are the darlings of MBA’s everywhere (and certainly important to understand), but often neglected or painfully unclear to any but those reading the company’s internal strategic literature.

In closing, I should also point out that planning is an ongoing process and no plan should ever be viewed as “locked in stone” or otherwise rigid. Circumstances change, and plans must adapt. Trying to implement a plan today based on yesterday’s invalid assumptions is foolish, and thinking that it will be any more effective tomorrow based on outdated data or realities is disrespectful of both the human and financial capital which must be invested in its pursuit.

A Zentropist must be respectful, even as he or she is tearing down or discarding false assumptions, outmoded ways of thinking or channeling the energies that heretofore have remained unfocused.

If you would like to receive a free, no-obligation copy of Black Rock Consulting’s “Strategic Brief Worksheet,with helpful instructions for developing a Strategic Brief, please contact us via email or phone.

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