Strategic planning looks beyond the day-to-day. It’s a checkpoint for you to stop for a moment and think through what you’re trying to accomplish and how you’re going to get there. How far ahead you look will depend on your business. If you need to make major capital investments, like building a new manufacturing plant, you’ll want to look at a time period that takes you from design to completion. For others, three years might make more sense.
Over the past three articles, we’ve looked at determining your starting location (Assessment), your intended destination (Goals), and differing situations you might face (Scenarios). Now it’s time to chart your course.
Base your initial plan on the most probable scenarios. Set out all of the steps required to reach the goals you’ve set for the first year. Every step needs a who, what, and when. Make sure the “who” knows what is expected, and that the “what” is clearly defined in terms of advancement towards the goal so you can measure progress. You also need to ensure that the how and why are very clear to those who need to complete those tasks. Create milestones that mark significant progress, and celebrate their achievement.
For the second and third years, quarterly objectives are probably sufficient. You can add in the steps for the next quarter when you complete the first. This will give you a rolling 12-month plan.
Now, look at your scenarios to see which ones are the next most likely. Think about indicators you can track that are signaling a change in that direction. Create pivot points, based on the data you’re going to watch. For this second most likely scenario, map out a strategy showing the changes from your original plan. Be sure to consider if different players need to be involved, or if more resources will be required to implement the work required for this scenario.
It may seem daunting to create the first plan, but you should only have a few drivers of change, and two to three alternative scenarios to your most probable. You don’t need to cover minor shifts, far-fetched situations, or emergencies like an office fire that should be covered in your Contingency Plan.
Only one or maybe two alternative scenarios will likely occur. This keeps your 12-month rolling plan largely intact, so changes, even year to year, may be minor. This also means that developing next year’s plan will be a much easier process.
We’ll sum up with this paragraph from Bain & Company (in an article by Nikhil Prasad Ojha, Miguel Simoes de Melo, and Rajiv Karna). “The hallmark of companies that chart the right course through turbulence is that they embrace uncertainty; they don’t try to fight it. They focus on the vital few uncertainties that matter, lay out the possible scenarios that could develop, and identify the critical trigger points or signposts that signal swings in direction. Planning becomes a cycle of ‘execute, monitor, and adapt’ that dynamically redirects the company toward the best opportunities over time.”
View More in This Series: Strategic Planning in a Capricious World