strategic business planning

Okay, we have seen this before. Business executives hustle off for a strategic planning retreat with their briefing binders in hand and the burning desire to come out of a planning session armed with a revitalized and innovative business direction for the company.

Didn’t this happen last year?  

Remember the sacred strategy document that was produced. This plan espoused the direction needed to unlock the company’s future advantages and represent the flint for change, prosperity and success. Nirvana at last!

Sounds exciting.

But sadly the swirl of enthusiasm drops off rapidly after the days following the retreat and the many weeks after the strategic plan is written.    

So why do organizations repeat the same strategic planning processes year after year believing they are loyally continuing a traditional planning cycle that will lead the company to the Promised Land?

Let’s explore five main fallacies that need to be changed to make way for a completely fresh approach to strategy development and implementation.  

Lore 1: The more time spent on strategic planning the more successful the business

There is absolutely no correlation between the length of time spent in strategic planning and the beneficial outcomes to a business. In fact, the more time spent on strategic planning the more management will get caught up and it becomes the focus. This promotes planning paralysis and any benefits which could be accrued are eventually lost as momentum declines. 

Lore 2: Diligently analyzing every aspect of the company’s market

Yes it is hard to argue that knowing the market is a good thing, however over analyzing and creating piles of data files or studies can lead to planning paralysis that will stymy strategy development. Furthermore, some analyses can be backward rather than forward   focussed causing a loss of perspective on future outlooks about where the company should be directed.

As the saying goes, knowledge is power but too much knowledge can turn any circumstance into a sea of endless options about which confusion and procrastination reins. 

Lore 3: A solid, good strategy is the key

A well-conceived strategy can be blindsided. It is difficult to predict changes in the marketplace as most strategic planning tends to use past information to predict future states. A good strategy has to be flexible enough to roll with the dynamics of changing external and internal environments.

Strategic plans, once developed, represent perspectives made from the contextual view at a single point in time. The circumstances in the next timeframe can render the plan obsolete. 

In addition, a great strategy cannot come alive without good solid leadership and this leadership has to come from all parts of the organization. Mobilizing a leadership culture around plan implementation is a critical element.  

Lore 4: Strategic thinkers are best at strategy development

The belief that strategic thinking is the privilege of only a few individuals in an organization promotes an exclusionary point of view. It represents an exclusive club mentality where only the elite are recognized as the gifted ones who have the intelligence to create the future direction of the company. 

There is also a viewpoint that to engage a broader group in the strategic planning process will slow it down. The belief is that by relegating strategic planning to an activity focussed more on consensus building is counterproductive when the view is taken that a smaller team can make decisions faster.  Is faster better?  Sometimes, but not always. 

Lore 5: Good communication is the panacea for effective strategy implementation 

Most often communicating the company’s strategic plan resembles a prophet coming down from the mountain top and issuing an edict. Although words like “cascading” or “socializing” the strategic direction with employees is often used, the approach resembles a one way water fall of information.  

Employees of the organization are given very little by way of understanding the reasons why the strategic direction was established – so context is invariably missing. And they no doubt even secretly harbor resentments about how the edict is being delivered to them. Resistance becomes a product of a toxic culture.

There is not enough in the communication plan to ensure employees have a complete understanding of where they fit in, how the strategic plan will be implemented and how it will impact their day to day activities and challenges. It comes across as a strategic plan in a strait jacket.

So with these fallacies identified my next blog will provide a fresh approach to strategic planning and implementation to show how these fallacies can be overcome.

Do Canadian entrepreneurs need to up their game? That’s the conclusion from a recent Vancouver Sun article that caught my attention, though I disagree with the premise; it’s more accurate to say that we still need to work on building a business environment that helps entrepreneurs thrive.

Here’s an excerpt:

“Then it becomes interesting. I’m a big supporter of the Vancouver tech community and I feel like we have a really good base here. But in the end, the only thing we can do to accelerate the development is attracting better entrepreneurs and more entrepreneurs to Vancouver. The more talented entrepreneurs we can get into town, the better.” Senia Rapisarda shares that sentiment.

The vice -president for strategic initiatives and investments at Business Development Bank of Canada, Rapisarda said that while Canadians have the technology and skill to compete in the high-tech market they are “a bit behind” when it comes to fostering development of what she described as “serial entrepreneurs.”

“Doing something, being successful and coming back for more, or doing something, failing, and coming back for more. We don’t have a lot of those, and we need them.”

I don’t think the problem is a lack of entrepreneurial spirit in Canada or even parts of the USA outside of traditional business hubs. If somebody tries to make it as an entrepreneur, fails and keeps failing, they still have to put food on the table. No one wants to keep banging their heads against the wall, so would-be entrepreneurs go back to working for others. The main stumbling block to creating serial entrepreneurs is how to provide an environment that supports entrepreneurship.

How to Develop an Entrepreneur-Friendly Business Environment

How do we develop an environment that creates more entrepreneurs and give these aspiring entrepreneurs (and serial entrepreneurs) an  edge? Here are a few ideas:

• Get people thinking about entrepreneurship earlier. Think back to high school or your childhood and when someone asked you what you were going to be when you grew up. How many of us listed a type of job rather than “starting a business”?
• Educate entrepreneurs about the resources that are available, such as government grants like SRED that help companies get the most out of limited budgets. All entrepreneurs understand the concept of bootstrapping, but not all understand that they can apply for funding even before they are ready to raise capital.
• Promote mentoring. The knowledge and wisdom of a board of advisors can be as critical to success as the raising of capital. There are some avenues for startups to take advantage of these knowledge resources through organizations like New Ventures BC, but these opportunities have plenty of room for expansion.
• Fail Fast; but fail cheaply. Entrepreneurs need to know the benefits of doing market research and how it can avoid costly mistakes. Make this business analysis tool set a fundamental part of any new and existing enterprise to minimize risks and increase value propositions. We know entrepreneurs rarely consider it an important element of business success.  Companies should be encouraged by funders and advisers to do market assessments, market validations, new product development research, customer segmentation and other research activities to make better decisions.

What else can we do to provide a more supportive environment for entrepreneurs? Leave a comment