Strategic Planning

By Jeff Green (Perth, Western Australia, WA January 2007)

I think that one of the most over used and least understood terms to come up in Job descriptions and resumes is “Strategic”. Managers Job descriptions are littered with the term so I would like to look at the definition of “Strategic” and in a business sense, how it differs from Tactical thinking.

Definition from Wikipedia: A strategy is a long term plan of action designed to achieve a particular goal, as differentiated from tactics or immediate actions with resources at hand. Originally confined to military matters, the word has become commonly used in many fields, including such terms as Business Strategy.

So from this definition the difference between tactical and strategic thinking is that a strategy is a declaration of intent, defining where you want to be in the long term. Tactics are methods that you employ to deal with immediate issues and with current resources. Strategic planning is forward looking, tactical planning is the here and now.
Strategic planning ensures that decisions made today will not have a negative impact of future results. It also ensures that everyone is working together to achieve a common goal. Now that sounds like a Mission Statement so your Mission Statement should be the result of strategic analysis and planning, it should be the statement of what you will delivery and to what markets and how you will delivery it. It will include your competitive advantage or point of difference, define the scope of your products, including quality, and reflect the resources and type of people used. It should be specific and avoid such unquantifiable terms as being “the best”.
There are 3 phases to developing a strategy: analysis, planning and implementation. A good way of understanding strategy is to look at a framework, beginning with;
• Analyse information to understand your position.
• Pinpoint your competitive advantage or point of difference.
• Define the scope of your products/services and markets.
• Decide where you want to focus your resources.
• Identify, prioritise, and implement change.
• Regularly monitor performance and review strategy.

The success of a strategy must be measurable, for example, by financial results, customer feedback, staff and customer retention.

Analysis

So we talked about the difference between strategy and tactics, then touched on strategic planning and the three phases of analysis, planning and implementation. I want to look at analysis in a bit more detail.
There are two simple frameworks for analysis, the discovery phase using the 5Ws and the actual analysis phase using SWOT. 5Ws stands for Who, What, Where, When, Why. SWOT stands for Strengths, Weaknesses, Threats and Opportunities. Both methods give you a starting point and once you start you will rapidly see how it all starts to fall into place.

Now the thing with strategic planning is not to limit your scope, you need to apply the 5Ws and SWOT to your company, your competitors, the customers and emerging markets (future customers). Also to broaden the scope, involve as many people as possible in the discovery phase, different people will bring differing focus and viewpoints to what information should be gathered.
After assigning fact finding tasks to your team, they are going to wonder where to start looking. Most will “Google it” but don’t ignore industry publications, where a lot of the work will already be done. Also survey your customers and contacts. You will be looking for what products and services exist relative to your industry. Then what markets are available to your industry. Also gather information on your and competitor’s performance specific to certain markets.
Once you have gathered the information, sort it into areas of relevance, based on the current and emerging markets, customers, products, competitors and your organisation.
Now you can begin your analysis using SWOT but wait, a tip from a seasoned practitioner, start with your weaknesses and threats not your strengths and opportunities. If you start with your strengths you will create a feeling of invincibility and start to believe you have no weaknesses. Also it is best to finish with a positive, so look at your strengths and opportunities last.
It is best to leave a day between each phase. After spending a few hours analysing your weakness or threats it is best to sleep on the ideas before moving to the next stage. This can be an emotive process so you need time to let the emotions die down so they don’t cloud your judgement and over night your sub-conscience can work on the process as well.

Planning

Having gathered all the facts during the analysis phase, it is now time to make decisions about the products and services you are going to offer and the markets that you are going to be a player in. You will need to take into account the areas where you have an advantage over the competition and establish the boundaries within which you will operate.
The first step will be to list the products and services that will be in demand in the future. Remember, be prepared to listen to your team and customers at every step along the way. You will then choose the markets to develop with existing and or new products and services. Also you will decide which products, services and markets it would be wise to leave.
Now, the best way I know of developing an actual plan is the project management approach. List the tasks to be preformed and break them down into detail called sub tasks, add an estimate for the duration and cost of the sub tasks and note any interdependencies, for example, task “a” must be completed before task “c” can start. Using a product like Microsoft Project you will quickly develop a detailed plan with visible timelines and milestones. I have used this product for all my planning activates, everything from multi million dollar projects to fly drive holidays. The great thing is that you can insert and delete tasks as to go and quickly understand the impact on the overall plan.
You will then be in a position to establish your financial position and develop realistic budgets.

Implementation

Having gathered all the facts during the analysis phase, you have now developed a plan and have a budget, now it is time to execute.
You may find that your aims have little change on the way your team works but usually your success depends on far reaching changes and the learning of new skills. Now as you will know, there are methodologies for managing change and systems for training and development. But simply put, managing change at the implementation stage is all about communication. During the planning stage you should have developed a communication plan that details who gets told what and when. During implementation you need to ensure that the plans are adhered to and that you adjust the communications plan to include anyone that was left out.
As you would have sought and included input from key stakeholders during the analysis phase, most people will already be onboard and you just need to keep them in the picture. It is also important to include your team by delegating some of the implementation tasks, keeping them involved will ensure their buy in and give you critical mass if you encounter any resistance. Organisational change is better achieved if there is a core of positive feeling within the ranks. Involving your team in all phases broadens your support base, they will spread the good word down through other staff, while you spread it up through your peers and senior management.

Finally a word on selecting key stakeholders to include in your concept analysis and planning meeting. Ask yourself these questions;
• Will this person add to the quality of the plan.
• Do I need their commitment to implement the plan successfully.
• Do they have specific knowledge or expertise.
Include senior management, they will ensure that the plan is consistent with other strategies in the organisation and experts to provide specialist advice on issues that affect the plan. Also consider backers to support the plan with resources or budget. Include Customers, Suppliers and Delivery Partners, to provide information on future requirements and new possibilities.