A client recently asked me why I’m such a firm believer in the power of planning. He also challenged me to tell him why planning is not a waste of time, since the increasing pace of change makes any plan obsolete in a matter of months – maybe even weeks.
I’ll admit to being a fervent believer in planning -– not just in having a plan – but engaging key people in developing the plan. The process itself helps people to understand the vision and their contribution to achieving it. Very importantly, involvement in the planning process increases the team’s critical thinking, decision-making capabilities and accountability.
Two high-growth organizations that I’ve managed had strategic plans that were executed primarily through a performance program that included weekly performance-to-goals meetings and open communication. I’ve also managed an organization without a strategic plan – a far less successful endeavor, and the experience that was largely responsible for my lifelong conversion to the power of planning. The best nonprofit board I ever served on, on behalf of a successful nonprofit organization, had a robust and inclusive planning process – and the plan was used to guide consistent execution.
Why is an effective planning process crucial to success?
1. A common objective and aligned goals result in hitting the target more often than not. A number of research organizations point to the fact that most strategies are never executed. It’s estimated that as few as 10% to 20% of all business strategies [regardless of the quality of the strategy] are ever consistently executed to meet business goals. It’s an amazing statistic that the mind wants to vigorously reject.
And of course, the smaller the organization, the greater the risk to survival when there are more misses than hits. It’s better to relentlessly execute a strategy that’s ‘close enough’, than to spend too much time and energy perfecting the strategy, and not enough time and energy keeping the best available talent focused on relentlessly executing.
2. Alignment is crucial to success. Deming [the father of what is known today as six sigma or continuous quality] once said “Pay attention to the first 15% of anything, and the rest will take care of itself.” When you have a common mission, objectives, and a plan to get there, it’s easier for everyone to course-correct in order to manage change.
Try this experiment: have two people stand side by side and begin to walk across a large space like a parking lot or gym. Ask them to move their feet so there is only one inch difference in their trajectory, and to walk in a straight line from where they started. When they reach the other end of the space, they will be many feet apart. If they continued, they would end up miles apart. In a more spontaneous environment, where the strategy is not well-articulated, and everyone executes according to their own understanding of the business objectives, it is common to encounter more challenges, confusion and a lot of backing-up and starting over – a frustrating, time-wasting, risky – and unfortunately, far too common approach to running a business. The result is missed objectives, frustration, lack of commitment, and eventually erosion of trust in leadership.
Now, have the same two people agree to end up the same distance from each other, and request that they regularly communicate when they’re drifting off-target and to course-correct as they go, and you will find that they end up very close to the goal.
3. Alignment is not a one-time event. It is the continuous weaving together of people, resources and activities to move toward a common objective.
Planning is not primarily for the purpose of developing a plan document. Often, plans are developed because a board or bank or other stakeholders demands one. Under these circumstances, the strategic planning process is close to worthless, and may in fact, cause damage. If you’ve experienced this type of planning charade, what happens the next time you need key people to participate in planning? Chances are, it will be difficult to engage them because they remember that they once spent days or weeks, offered all their great ideas, only to see the binder containing the results of all that hard work gathering dust on a shelf. The annual ceremony of blowing dust off an old plan document does nothing to increase engagement, alignment, or accountability for results.
The planning process is at least as valuable as the plan itself. Planning immerses each participant in understanding the vision. Every person who is involved comes away with a deeper understanding of the mission, resources, leadership and commitment of the organization, as well as an increased ability to apply critical thinking to assuring that their productivity contributes to the growth and health of the organization.
By the way, if you’re the leader, resist the impulse to facilitate the planning process yourself, even if you have good planning skills. Why? Because you’re unlikely to be objective and patient enough to allow new ideas to bubble up. You are also very likely to assert your authority – directly or indirectly – so that people feel excluded and the plan is not the team’s, but yours.
The strategic plan, when developed well and for the right reasons, is the guiding star for the organization to achieve its mission. The performance/ operations plan that rolls out of it is the GPS system to get you there – when it is used to guide relentless execution to meet objectives.