Some
Characteristics of Good Strategic Plans
Dwight Eisenhower once
said, "I have always found that plans are useless but planning is
indispensable." It's a good way of saying that effective strategies must
be adaptable by nature. Rigid sets of instructions just won't do.
Still, a well conceived
and written strategic plan can be a helpful guide for programs, policies, and
processes if it achieves some basic things. Note that most of these
characteristics have less to do with the plans' format and more to do with its
practicality and clarity. To these ends, good strategic plans share the
following characteristics.
o
Accountability—responsibility is assigned for successful completion of
initiatives.
o
Balance—the plans guide not only financial decision-making, but also
operational and human resources issues.
o
Flexibility—a mechanism for changing and updating the plan is built into
the process.
o
Manageability—in-process measures are identified to ensure processes are
working as intended, critical performance issues are addressed, resources
required are projected, and methods of status reporting are in place.
o
Prioritization—priorities are established whenever there are multiple
interdependent action plans.
o
Realism—the question of what the organization can do versus what it
would like to do is addressed rationally, though the tone is optimistic.
o
Specificity—expected results and milestones are clearly defined, along with
the specific actions for implementation and the deliverables for each step.
o
Sustainability—a sufficient time period is covered to close performance gaps.
Do Mission, Vision, and Values Statements Matter?
Many strategic planning processes begin with the planning team creating mission, vision, and values statements. The theory is that defining a shared purpose and long-term objectives is vital to the planning process and to implementing the strategy.
But some strategy specialists question the need for putting mission, vision, or values statements in writing at all. One of their main objections is that too many of these statements sound generic and aren't actionable. Another complaint is that people often mistake vision statements for mission statements, creating more confusion than clarity.
What's the difference between mission and vision?
Here's the basic difference. A mission statement defines the fundamental purpose of the organization—its customers, critical processes, and benchmark level of performance. The focus is on the present. A vision statement, on the other hand, describes what the organization wants to become. It concentrates on the future. It is a source of inspiration and a yardstick for decision-making.
Which comes first, mission or vision?
Another perennial debate is over which comes first—mission or vision. Of course, it all depends, but here's a rule of thumb. For start-ups, new programs, or plans to reengineer current services, vision guides mission. But for established organizations with clear-cut, implicit, or timeless missions, the enduring mission guides the changing vision. Either way, the organization's purpose and destination described by the mission and vision serve as a compass to keep the strategic plan on course. As the plan is being developed, it helps to stop occasionally and ask, "Is what we're talking about now consistent with our mission and vision?"
Do values statements help in strategic planning?
Values are guiding principles that express the core beliefs and norms of a group or organization. They're often rooted in ethical themes and are intended to provide a framework for decision-making. Values do seem to be useful in the strategic planning process when they apply across the entire organization and also outline management best practices. When this is the case, values can provide helpful guidelines for choosing among a variety of possible goals or objectives. The jury isn't in on whether values statements improve organizational performance. However, there's lots of evidence to show that staff morale and retention rise and fall to the degree that espoused values align with values in practice. This suggests written values are only advisable for orgs that practice what they preach.
When do mission, vision, and values statements help?
To be of use, mission, vision, and values statements must be assimilated into the organization. It's not enough to post statements that executives came up with on the walls. For these processes to pay off, the organization needs to:
o
Communicate these
principles system-wide through many mediums.
o
Relate and reinforce
stories that demonstrate the mission, vision, and values in action.
o
Embody and enact vision
and values in management practices.
o
Define short-term
objectives that are compatible with the long-range vision.
o
Encourage people to
craft personal visions that align with the organizational vision.
o
Find creative ways to
involve as many people as possible in the mission/vision/values creation
processes.
o
Steer clear of generic,
wordy, and business-buzzword jargon in favor of clear, specific, and relevant
language.
What Are Some Viable Strategy Models?
The terms strategy development and strategic planning mean very different things to different people. Not surprisingly, there are literally hundreds of models for developing a business or organizational strategy. In fact, the basic thrust and purpose of strategy is even conceptualized in disparate ways. For instance, strategy has been framed as:
A learning process: Views strategy as an emergent path that is created by management seeing what does and doesn't work over time and incorporating lessons learned into revised action plans. Examples: Learning Organization (Peter Senge); Emergent Strategy (Henry Mintzberg).
A living system: Conceives of human organizations as biological systems that grow and evolve in complex, organic ways that resist being treated like machine inputs and outputs. Example: A Simpler Way (Myron Kellner-Rogers & Margaret Wheatley).
A process of building upon strengths: Emphasizes the positive and building upon what's already working well instead of focusing on gap analysis and fixing weaknesses. Examples: Appreciative Inquiry (David Cooperider); Strength Management (Marcus Buckingham).
Cognition: Regards strategy formation as a mental process that hinges on aspects of neuroscience, such as human pattern perception and information processing. Examples: Strategic Cognition (Fran Ackermann & Colin Eden); Causal Cognitive Mapping (Gerard Hodgkinson & Nicola Bown).
Community development: Views strategy formation as a collective process involving various groups within the organization, so that the strategy ultimately reflects the community and culture. Example: Council Process (Jack Zimmerman & Gigi Coyle).
Designed change: Regards strategy formation as a process of adapting the organization's internal strategy, structure, and processes to the external environment in order to achieve the best possible fit. Examples: Integrated Strategic Change (Christopher Worley, David Hitchin, & Walter Ross); Strategic Fit (Cornelis de Kluyver); Gestalt Theory/Field Theory (Max Werthheimer; Kurt Lewin).
Networking (alliance creation): Views strategy as the art and science of discovering new sources of profitability in networked industries. Example: Delta Project (Arnoldo Hax & Dean Wilde).
Power or politics: Conceptualizes strategy as a negotiation process between power holders within the organization, or between internal and external stakeholders. Examples: Transformational Change (John Kotter); Managing with Power (Jeffrey Pfeffer).
Process improvement: Holds that strategy creation is less a response to external competition than a process of ongoing internal improvement in the interests of quality, productivity, or performance. Examples: Six Sigma (Bill Smith); Total Quality Management (Genichi Taguchi); Continuous Process Improvement (W. Edwards Deming).
Statistical insight: Proposes that competitive strategy should be data driven through the application of sophisticated quantitative, statistical analysis and predictive modeling. Example: Competitive Analytics (Thomas Davenport & Jeanne Harris).
Structured analysis: Views strategy formulation as a formal process that follows clear-cut steps based on in-depth research and structured analysis. Example: Scenario Planning (Herman Kahn; Pierre Wack).
Value creation: Sees strategy development as a collaborative process whereby value is constantly co-created and co-managed with stakeholders and customers. Examples: Co-Creation (C. K. Prahalad); Customer Equity (Robert Blattberg).
Visioning: Deems strategy to be most viable when it's co-created by stakeholders through a process of envisioning a better future and taking individual responsibility for the initiatives needed to get there. Examples: Future Search (Marvin Weisbord & Sandra Janoff); Search Conference (Fred Emery & Eric Trist).
Which strategy approach should you use?
No matter what the popular strategy books say, no one strategic approach is best for all organizations. In fact, we've found hybrid approaches are often the most workable. Before specifying a strategic planning process for an organization, it's important to evaluate several factors including:
o
Strategic objectives
& timelines
o
Organizational culture
& life stage
o
Organizational structure
o
Leadership involvement
o
Environmental &
competitive factors
o
Planning resources
o
Planning team
composition & roles
o
Customary working
approach
The whole point of the planning process is to improve the organization's future performance. This requires some degree of organizational assessment to begin with in order to choose and design a best-fit strategy development approach.
What is Strategy Anyway?
The word strategy derives from the Greek "strategia," which means "office or command of a general." Of course, since the days of Alexander, usage of the word has expanded from the original military context. Today, strategy generally refers to plans, methods, or activities for obtaining desired results. In other words, strategy is about creating successful futures—however success is defined.
Strategy development typically is viewed as the process used to determine where an organization is going over the next three to five years—although some organizations have 10- and 20-year plans. That said, many organizations have survived and even thrived without explicit strategies during times of relative stability and little competition for customers or resources. Unfortunately, such conditions are short-lived these days.
Ways to conceive of strategy
The concept of strategy often confuses people, because the term is used in so many different ways—sometimes even by experts. Mintzberg, Ahlstrand, and Lampel frame the various conceptions of strategy as 5 P's. So strategy can be seen as a:
o
Plan—a guide for a course of action or a path from a current state
to a desired future state
.
o
Pattern—a consistency of behavior over time.
o
Position—the location of particular products in particular markets.
o
Perspective—the theory of the business, that is, a philosophy about
interacting with customers or supplying products and services.
o
Ploy—a means of gaining competitive advantage through specific
maneuvers designed to outwit competitors or opponents.
What's
strategic planning and why do it?
Strategic planning is the process many organizations use to prioritize action plans. In simple terms, it helps groups choose what to do and what not to do. The aim is to focus the whole organization on executing a single game plan. Strategic planning can also provide an outline for resource allocation and decision-making. Although there are hundreds of planning models, most strategic plans answer four basic questions:
1.
Where are we now?
2.
Where do we need to
be?
3.
How will we close
the gap?
4.
How will we monitor
progress?
The thrust of good strategic planning is to be proactive about the future. When done right, strategic planning holds the potential to improve performance and counter internally focused, short-term thinking. It also enables organizations to address major issues at "the big picture" level and to communicate to everyone what matters most.
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