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Advisors: The Keys to an Effective Strategic Planning Meeting

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What does the new year hold in store for you? This is a popular time for advisory firms to lay out plans for the next 12 months. Unfortunately, many strategy sessions end up being much less productive than they could be, producing a document that no one will look at for another year and failing to create any real change or progress in an organization. I am just wrapping up the current season of helping advisors conduct their strategic planning meetings or exercises. So, while it is fresh in my mind, I wanted to share a few of the keys to having an effective strategic planning meeting. Whether yours is done at a regularly scheduled management meeting, as an extended lunch, or as a full day off-site, here are a few tips to make the exercise productive.

Review last year’s goals – looking back at the plans you made last year and what you accomplished based makes your planning exercise a learning experience. Make yours straightforward, nonjudgmental, and brief. Simply list each goal you developed in last year’s meeting, indicate whether you accomplished it or not (or if there is no way to know, which is itself an important learning opportunity), what you learned in attempting to achieve them, and what the person responsible for the goal could have done better. The president or leader should go first in sharing what they could have done better to set the tone for the rest of the group. No blaming or finger-pointing. A dispassionate evaluation of how the organization did will help you develop better goals this year.

Focus on your audacious long-term goal – what do you want the organization to look like in 10 to 20 years? Describe it in as much detail as possible. Make it quantitative. I have seen strategic plans whose long-term objective read something like “to be a respected fiduciary firm.” How do you know if you have succeeded? More important, it is not something that will get people excited. It is certainly not audacious. “We will be the largest financial planning firm in Miami” is better. “We provide comprehensive financial planning services to more high net worth households in Seattle than any other firm” or “we are in the top 50 of Financial Planning magazine’s top RIA firms” is better yet.

Develop short-term goals – I am a fan of Verne Harnish and his Mastering the Rockefeller Habitsand, to oversimplify some of what he has to say, you will want to know where you ultimately want to be and what the next step is. Developing one, three, and five year plans is futile. The environment is moving too fast and too much can happen in the next year to make detailed intermediate to long-term plans worthwhile. But knowing your goal in as much detail as possible and knowing what you need to do to take the next step in that direction makes for good strategic management. So once you have your detailed long-term goal develop a 90 day plan. One year goals can be helpful but what you want to accomplish in the next quarter is more important.

Be careful about brainstorming – brainstorming ideas can work but only if done properly. And most planning meetings are not conducted properly. “Properly” includes many guidelines included in the 1953 book that popularized the idea that are frequently ignored, including having the right group size, focusing on idea generation without evaluation, using it as a supplement to individual idea generation, and using a facilitator to enforce the rules. The way brainstorming works in many organizations is a conversation dominated by the loudest or highest-ranking participant generating a few ideas and then systematically tearing them all down. There are several variations that can help make it more productive. One of my favorite exercises is to have group members write as many ideas as they can come up with on Post-it notes and then group them on a wall or a whiteboard into general categories. Another is to solicit as many ideas as possible and then have group members allocate a limited number of “votes” (usually colored stick-on dots) for the ones they want to explore in more detail. The top half dozen or so get further in-depth discussion.

Be reasonable about what you can expect to accomplish – avoid going overboard on the number of project you undertake. Three initiatives is probably about as much as an organization can hope to devote attention and resources to at any one time. If you can comfortably manage significantly more than that, your initiatives are too small.

Dig deep – many strategic planning exercises fail because ideas are not developed. The group generates lots of lists on flip charts which get transcribed and distributed to the group that are then ignored. They lack concrete plans. Come up with all of those lists of ideas and then focus on the top 3 to 5. Distill, distill, distill. Split into smaller groups to develop projects around those goals. What would success look like? What would be involved in accomplishing them?

“Red team” your plans – the military is famous for developing exercises to simulate campaigns. Groups are divided into teams to compete with each other. The “red” team is always the bad guy. Even when evaluating projects, they “red team” their plans. A working group presents a strategy or plan. Another working group, the red team, has the responsibility of finding the flaws and weaknesses and cutting the plan to shreds. The group who is presenting the plan takes that feedback and updates the plan to address the flaws and weaknesses. The presenting group is not allowed to rebut or argue during the red team exercise. The red team criticizes but does not insult and their comments are taken as valuable feedback. Try this exercise and your plans will be a lot more achievable. By the way, the red team are not the enemy in real life. After the exercise, they will be as responsible for seeing the plans through to success as the team who developed them.

Make sure each objective has a DRI – Apple is famous for making sure that every initiative has a particular individual whose job it is to see it through. They even have language for it: a DRI, or directly responsible individual. You could hear the term thrown around in management meetings. “Who’s the DRI on that?” Before you conclude your planning exercise make sure that each objective has a particular person who is accountable for it and must report back to the group periodically on its progress.

What have you found that makes your strategic planning exercise effective? What things have you done in your planning meetings that created the biggest results? Share with us your recommendations!

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