In today’s hyper-competitive, global marketplace, strategic planning done right is critical to protecting what you have and growing.
PwC recently hosted a webinar on the fundamentals of strategic planning. An informal poll of participants*— all private company leaders — revealed that only 12% were convinced their employees could articulate their company’s vision. Russell Fordham, director, consulting and deals, private company services, PwC, wasn’t too surprised. In part, at least, the disconnect can be chalked up to a lack of understanding about strategic planning, what it involves and what a strategic plan is and does.
“Many company leaders see a strategic plan as the same as a business plan or annual budget,” says Fordham. “In reality, it falls somewhere in the middle. A strategic plan is really the cornerstone to a company’s sustained competitive advantage. It spells out exactly the steps necessary to generate profit and value and everyone’s specific role in making it happen. If strategy is blue sky, ambitious and grand, then a strategic plan is where the rubber hits the road. It’s about execution, accountability, alignment and communication—all critical elements if you want your team going in the same direction.”
And it comes down to asking and answering some fundamental questions: Where are you now? Where do you want to be? How do you get there? And who’s going to make it happen? In today’s hyper-competitive, global marketplace, strategic planning done right is critical to protecting what you have and growing, says Fordham. “If you don’t do it, you risk losing ground.”
The first step is committing to the process. “The leader has to make the decision that it’s important to sit down with some key people on his team to map out what they want to achieve and where they want to be in the next three to five years,” says Fordham. He suggests setting aside one to two days and holding the meetings in an offsite location. “View it as an opportunity to re-energize; BlackBerrys off,” he says.
How to focus and prioritize
This really comes down to what dollar number you’re after and setting the three-to-five big-ticket drivers/ initiatives to get you there. Then break down what needs to happen in the next six, nine, 12 months to be successful. You might have 20 priorities or action steps to get to your overall goal. Some things may be urgent, others not. For example, the first priority may be to fine-tune your vision and mission statement. Once you’ve done that, you can align your goals to the new vision and mission and then you can start to message that throughout the organization and start to align people’s performance and compensation to that. “Once you have those goals and priorities as your focus, you stop doing the stuff that doesn’t make sense,” says Fordham. “The need to execute leads to discipline and what wraps all this up is monthly touch points where you talk about what’s been happening. How are you doing? Where are the roadblocks?”
This is the alignment and integration of business processes that allow a business to operationalize their strategy. If working effectively, performance management allows the executive team to align people and processes to the same set of strategic goals. “It’s about synchronicity and ensures your company is operating at its full potential, that everyone knows what they need to do and is held accountable so that the business can achieve its strategic goals,” says Fordham. “That’s why it’s important to build performance metrics into the strategic plan. Performance management will make sure everyone is aligned to those goals and that you’re making progress by measuring where you’re at in terms of pre-determined milestones. If you’re not gaining ground, it will show you where things are breaking down so you can reset and keep moving forward.”
Cascading the plan
Each functional leader is responsible for making the strategic plan real for their teams and each individual employee in that team. They have to articulate how their functional group contributes to achieving the overall strategic goals of the company and what that means in the trenches in terms of what each individual team member needs to do and achieve. “Everyone’s performance has to be measured against how successful they are in meeting the objectives they’ve been given. They should be recognized and compensated based on how well they’ve executed against plan,” says Fordham. “The only way this is going to happen is if you are constantly communicating. The fact that only 12% of our poll respondents believed their employees could articulate their vision tells me they aren’t communicating the strategic plan. And if they aren’t doing that, what can they really be achieving?”
*89 individuals responded to the polling question
|Download the full PDF publication. (102 KB)|