“Strategy without tactics is the slowest route to victory, tactics without strategy is the noise before defeat.” ~ Sun Tzu
Strategic planning, the process of establishing the guiding strategy of a firm is something either not done at all or done poorly at many firms. The most common complaint I have heard from senior leaders of companies in my 30+ years in the financial services industry is that strategic planning seems like a waste of time. These leaders describe the days and weeks spent crafting, honing, and fine-tuning the “perfect” strategy and yet at the end of the year, or 3 years, or 5 years, the organization did not seem to make any more significant progress than in any other similar period. Strategic planning does not need to be difficult or a chore to be avoided, when there is an effective strategic planning process in place the end result can actually be enjoyable and extremely successful.
In my experience, there are 4 keys to developing and executing a strategic plan with successful results.
1. Needs to incorporate measurable results
An effective strategic plan cannot simply be a set of high-level objectives and goals the firm hopes to achieve during a set period of time. Without measurable action steps underneath each objective there is no accountability. Too often firms spend the necessary time and effort creating a great high-level plan focused on strong, important objectives that, if achieved, can move the organization forward dramatically. Leaving the measurable accountability out of the plan is equivalent to leaving the turn-by-turn directions out of a GPS mapping system. You know where you want to end up, but you lack the details on how to get there. A structured GMA (Goals and Measurable Actions) approach incorporated within your strategic planning process will increase your probability of plan success.
2. Include intermediate signposts
With most strategic plans spanning 3 – 5 years, that is far too long to wait to determine whether you are successfully executing on your strategic objectives. Even being slightly off course can lead to drastically different results. Consider that if you were traveling from San Francisco to Washington, DC and you were off course by only 1 degree to start your trip, you would end up on the other side of Baltimore nearly 43 miles away. The same holds true in strategic planning – execution being off by a mere 1 degree can be the difference between success and failure. Having signposts along the route (we focus on quarterly in our work with clients) allows you to quickly assess how well your strategy is doing and provides the ability to get back on course with only minor adjustments, if necessary.
3. Allow input from all levels of the organization
Typically strategic planning is a top-down process. Senior leaders gather to determine the overarching strategic direction, set major objectives for the next few years, and then allocate responsibility to associates for each objective. Their idea of inclusion is making sure that lower-level associates are given responsibility for some of the strategic objectives. Perfect, right? Not if you want complete buy-in and commitment to the strategic plan from all levels of the firm. Once a firm’s senior leaders have established the top-level strategic direction of the firm, incorporating the entire firm in brainstorming and setting the underlying objectives, goals, and measurable actions is imperative. Not only will including everyone in determining HOW the plan will be executed lead to strong buy-in, it often also allows you to identify unique goals and actions that otherwise may never have been surfaced.
4. Execution of the plan MUST apply to everyone
Strategic plans, when done well, create healthy change within an organization. Identifying what the firm needs to be doing and where it needs to be focusing several years into the future, accounting for a constantly – and sometimes rapidly – evolving outside environment requires change. Yet, as we all know well, change is often uncomfortable and creates fear. Often it is the associates with the longest tenures who struggle most with change, and it is common for a firm’s senior leaders to give these associates a “pass” from accountability toward executing on the plan. These exceptions to accountability are a death-blow to successful goal achievement. In Daniel James Brown’s exceptional book, The Boys in the Boat, we see that if one rower of an 8-man crew is not rowing perfectly in sync with everyone else the boat cannot achieve its goal, nor win its race. The same result occurs when only one associate within a firm, even if (actually, especially if) that one associate happens to be the CEO or President of the firm. Everyone, let me repeat EVERYONE, must be on board and accountable to executing on the goals and actions of the strategic plan.
Strategic planning is a critical piece to the successful growth of an organization. Operating without a strategic plan is akin to sailing without a rudder, your firm will often move in circles struggling to create and maintain lasting momentum. At the same time, strategic planning does not need to be a chore or a waste of time. Focusing on the process, and the four key elements mentioned above, will lead to greater probabilities of successful and enjoyable strategic planning for you, your associates, and your entire organization.
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