No Strategic Plan Survives its Collision with Reality

As a strategic planning practitioner I have heard every conceivable rationalization about why strategic planning is a bad idea. It takes too long; the world is too volatile, my people can’t think strategically. Yet study after study (including the annual Bain Top 10 survey) consistently suggest that strategic planning provides amongst the greatest ROI of any management activity.

So why all the angst?  I read a statistic in the Harvard Business Review this month that took my breath away (see Where Strategy Stumbles by Sull, Homkes and Sull). 84 percent of managers surveyed said that they “can rely on their boss and their direct reports, most of the time”.  Nine percent, said they could rely on their colleagues in other functional areas all of the time, and half most of the time.” Translation: work within a department gets done, but cross functional work (such as broad objectives  identified in a strategic plan) are often mismanaged. In other words, we have seen the enemy and it is ourselves.

Having worked with over 100 organizations, and more executives than I care to quantify, these numbers are consistent with my experience. The prototypical corporation is structured to support functional departments such as sales, engineering and accounting. Each functional area is built to protect the status quo, and institute checks and balances (which remarkably is how the Federal government works). Thus the rub; functional departments can also promote extraordinary dysfunction, and distrust. Corporations have fiefdoms because they are built that way.

At the core, the problem with strategy is not the strategy itself, or the process for creating it, it is the systems used to execute it. Just this week I met with a management team who retained our firm for the second year to do strategic planning.  The management team was unanimous in their opinion.  Strategic planning was extremely impactful in terms of providing a road map, clarifying targets and creating unity in their management team. After about nine months of focus and discipline, they ran out of steam. They stopped meeting to discuss their strategic objectives, as a large project (ironically born out of strategy planning) sucked all of their bandwidth. We have seen the enemy and it is ourselves.

Thus no strategic plan survives its collision with reality, which is that the operating environment changes, priorities change, resources shift. But that is not a reason to get off plan. The execution of strategic planning (or anything else of that matter) requires discipline.  Above all else, there must be a systematic focus on allocating resources, and ensuring enterprise wide communication.

I was working with a client recently who faced this very problem. The management team instituted a decision matrix with some simple rules. Any time a decision is to be made, managers would ask the following questions:

• Who will be affected by the decision?
• Who needs to give input, or be involved in making the decision?
• Who needs to be informed once the decision is made?

Recapping decision and action steps from meetings where such topics are discussed is a necessary protocol within organizations with so many moving parts. Functional managers must go out of their way to make sure other functions know the pecking order of priorities.

So, if you are committed to strategic execution within your company, make sure your functional departments have systems for regular communication. If a company should lose sight of its strategic priorities, it is not the fault of the lieutenants that carry them out. It is the responsibility of senior executives to promote processes that demand focus on the prize.

Marc Emmer is President of Optimize Inc., a management consulting firm, specializing in Strategic Planning. Marc can be reached at marc@optimizeinc.net.

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