Best Practices: Strategic Planning
With the New Year upon us, many companies are finalizing their 2010 goals and objectives through a process called “Strategic Planning.” Done well, strategic planning is not an easy process, but those companies that do it well will be rewarded, and those that don’t can face serious challenges.
At M Squared Consulting, we’re committed to helping clients achieve their business objectives, and offer these tips for sound Strategic Planning:
Plan and Process
An organization’s strategic plan should:
- Be ongoing and never-ending
- Represent a shared vision of where the business is headed and what is needed to get there
- Be integrated into a continuous business cycle
The Planning Team
The strategic planning team should represent a broad spectrum of segments within the organization.
- The ideal size is nine to 15 members with an outside facilitator.
- The CEO must serve as the strategic plan’s “spiritual leader.”
- Choose planning team members based on merit, not rank or entitlement.
The Planning Process
The strategic planning process consists of an orderly sequence of activities, each contributing to the success of the whole. The process should take place off-site, away from telephones, faxes, etc., so that team members can “disengage” from day-to-day operations.
Best Practices:
- Practice creative thinking. Generate as many ideas a possible during the early, “out-of-the-box” mode.
- Take a critical, unbiased look at what has worked before and what hasn’t.
- Identify the best of your past business practices and drop others that have led to costly mistakes.
- Create four to six long-term goals linked to the organization’s vision.
- Devise strategies to achieve these goals and objectives.
- For each objective, create specific action steps.
The Mission Statement
A mission statement describes what an organization does, what markets it serves and what it seeks to accomplish in the future.
- The mission statement describes how the business serves customers so they will underwrite its strategy.
- It serves as a guide for day-to-day operations and as the foundation for future decision-making.
- For employees, a strong mission statement builds commitment, loyalty and motivation.
Best Practices:
- Describe the essence of the business in words your employees and customers can understand and remember.
- Focus on specific traits and on target or niche markets.
- When the mission statement is created, post it on conference walls, on promotional materials, even on the packaging of products.
Goals and Objectives
Strategic planning identifies an organization’s goals and objectives. Goals set the agenda and are global in nature. Objectives are more specific and short-term.
- Goals identify areas where a major transition must occur (a transition is described as “from … to”).
- Objectives should be measurable, quantifiable and consistent.
SWOT Analysis
A SWOT (Strengths/Weaknesses/Opportunities/Threats) analysis is a tool for looking critically at the organization.
Best Practices:
- Draw upon a variety of perspectives – from the CEO to employees, customers and others who rely upon the business.
- Identify only those tangible and intangible assets and obstacles that are tied to your company’s long-term goals.
- Gather “competitive intelligence” by purchasing a competitor’s product, hiring one of its ex-employees or visiting its booth at trade shows and conferences.
- Collect information on the Internet by viewing a competitor’s Web site and/or searching online publications.
Implementing the Plan
The results of the strategic planning process must be integrated with an organization’s daily, weekly and monthly routines.
Best Practices:
- The CEO should develop a “stump speech” around the plan – promoting its values, mission statement, actions, etc. – and spread the word wherever possible.
- Enlist a support person (or “champion”) for each strategy and action.
- Organize top and middle managers into a “strategy team” that become agents for change. The CEO should receive direct reports from these teams on a regular basis.
- Avoid common implementation mistakes such as: (1) lack of communication throughout the company; (2) treating the plan as something separate and removed from the management process; and (3) choosing to make intuitive decisions that clash with the plan’s accepted objectives.
- Set up a feedback mechanism so that employees can respond to the strategic plan.
- Share the plan with other stakeholders – investors, customers, alliance partners, etc.
- Keep the plan alive by monitoring its ongoing progress. Conduct 60- or 90-daysenior management reviews. Implement objectives by expanding employee skills through training and recruitment.
- Target sales to make the link between business strategy and sales strategy.
- Reward success to increase employee motivation.
These suggestions should put you on a path toward a successful Strategic Planning session. Should you need help with your program, please contact us at M Squared Consulting. Best wishes for a prosperous New Year!
