The Elements of Strategic Business Planning

In our previous article, Planning: What It Is, Why We Do It, and What a Great Strategic Planning Process Look Like, we revealed the in’s and out’s of strategic business planning: a process millions of organizations around the world do every day. Some do it well, others….don’t.

Ready to see how your planning process stacks up? Read on to see if your process incorporates the thirteen elements of great strategic business planning…

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1. A Planning Model or Framework

First and foremost, every organization should have a simple, commonly understood strategic business planning process to ensure quality plan development. It will serve as a guideline that will promote careful consideration during the planning process throughout all levels of a company: individual, team, and organizational.

2. A Detailed Mission Objective

This is the first step in any planning process—defining the desired end-result and aligning all efforts with that end-result. In order to accurately determine success after the execution phase, the mission objective must be four things: clear, measurable, achievable, and aligned with your organization’s High Definition Destination.

3. Dynamic

Last month’s post discussed adaptability and the crucial role it plays in succeeding in complex and constantly changing environments. While the act of planning strengthens adaptability, the plans themselves must also be adaptable, dynamic as opposed to static.

Including scheduled progress reviews throughout the execution phase will provide regular updates on items from the plan’s course of action. In Flawless Execution, this process of regular review is called an Execution Gap meeting, or X-Gap meeting. These meetings are short, concise, and allow for plan adjustments for circumstances that could otherwise sidetrack or derail the mission if left unaddressed.

4. Iterative

Contrary to dynamism, which is built into the plan to occur during the execution phase, iteration should occur during the planning phase. By this we mean that developing a strategic plan should progress through stages of development; a well-crafted plan will have at least one round of Red Teaming, where it is subjected to analysis by a third-party group that was not involved in the plan development. Red Teaming allows objective minds to review the proposed plan and identify any gaps or omissions, and provides the planning team an opportunity to revise the plan accordingly.

5. Learning from Experience

Today’s complex business environment demands the ability to learn and adjust to change quickly. Great strategic business planning can only occur when an organization and the individuals within it continually learn from their environment and the execution of plans. They must then capture those lessons learned, disseminate them throughout the organization, and apply to future planning.

This capacity to learn, not just individually but organizationally, is essential to continuous improvement and cannot occur without proper Debriefs. The fourth, and arguably the most vital, component of Flawless Execution, Debriefing protects Plan Y from the mistakes of Plan X—but only when lessons learned are utilized in planning. This is the significant differentiator for winning organizations.

6. Means to Achieve/Course of Action

The central element of any plan, the Course of Action, establishes Who does What by When and How completion is assessed. Whether completed in parallel, in a series, or a combination of both, a Course of Action must be present in every plan to definitively outline the time-sensitive tasks each individual is accountable to, and the measure by which the task can be concluded as finished.

7. Decentralized

You wouldn’t want your executive team planning the details of developing and implementing the replacement of a main server in the IT infrastructure, would you? Planning teams, regardless of organizational rank, should not plan beyond the scope or expertise of the group as a whole. A large, complicated undertaking like the replacement of a server is incredibly tactical, and often times, outside the expertise of the executive team. Instead, an executive team should identify the need for an upgrade in the IT infrastructure when developing a strategic plan. This objective can then be delegated to the CTO and the technology department to develop a plan that supports this organizational strategy.

8. Individual Accountability

The scope and detail of strategic business planning is complete only when each task within the Course of Action is assigned to a single individual, not a team, to complete. Without individual accountability to each task and then again to each plan, there is a significant risk of misunderstanding, and thus failure. When planners walk out of the room without responsibility assigned for each and every task, fingers will be pointed and shoulders will be shrugged when something goes wrong. But this is a shared failure from the top-down. Proper planning requires accountability at every level and should be considered incomplete without it.

9. Supports Initiative and Good Judgment

Plans need to be developed by those responsible for completing the given objective. Why? Because when the planning team’s initiative is required to develop the plan, those individuals are empowered to accomplish the mission without becoming micromanaged and the likelihood of success improves exponentially. Furthermore, the plan should not impose unwarranted detail or restriction, as the team should be allowed to exercise judgment and adjust to changing circumstances in order to execute more effectively.

10. Threat Assessment

In order to assess the viability of meeting your objective, your planning process must include consideration of all threats—what stands in the way of achieving that mission objective? We categorize threats into four categories: internal and external, controllable and uncontrollable. After identifying and examining your threats, you can allocate resources appropriately.

11. Resource Assessment

What resources do you need to mitigate the assessed threats and accomplish the objective? Planning teams should not commit resources unnecessarily or waste them. Through critical leverage points, the Flawless Execution model allows organizations to focus their energy and resources in the most efficient and effective way to achieve the objective at hand. By prioritizing these leverage points, you can utilize your resources to the greatest effect.

12. Participatory and Cognitively Diverse

As we mention in February’s post, the most effective strategic business planning is conducted in groups so as to incorporate the knowledge, skills, abilities, and experience of multiple individuals. Planning is a process of problem solving, and problem solving in our complex world requires teams of cognitively diverse individuals.

To that end, active contribution by individuals executing the plan serves as a form of training. Participatory planning allows each individual to understand more intimately how their respective tasks relate to others and how those tasks ultimately support the accomplishment of the mission objective. When the plan is a collaborative and team-oriented product, each member’s knowledge and skills is a contributing factor—everyone owns it.

13. Simplicity

The more complex a plan and the process that produces it is, the more likely it will fail. By this we mean:

• The planning methodology must be simple such that everyone on the planning team can be easily trained.
• The plan itself must be simple enough that there are no confusing or complex dependencies on other individuals or tasks.
• There can be no ambiguity regarding tasks, each must answer Who does What by When.

When developing a strategic plan, simplicity is about reducing the complex down to single, simple executable steps. When such a level of planning is achieved, execution failure can be alleviated. Remember, simplicity enables the organization, complexity derails it.

So, how does your strategic planning process stand-up? Does it get you to the right strategy? How well do you meet all or most of the thirteen elements? Could your team use a planning process overhaul?

If the thought of introducing all of these elements to your strategic planning process seems daunting, it shouldn’t. By following the Six Steps of Mission Planning^SM, your planning process will naturally achieve all thirteen elements. Whether developing an organizational, strategic, or tactical plan, the Six Steps will guide your team through a simple, scalable planning process that will produce a more holistic plan.

Goal-setting is an important ingredient in success. But that’s obvious. After all, how can your strategic business planning be successful unless you first determine what success looks like? “If you don’t know where you are going,” Yogi Berra once said, “you might wind up someplace else.”

Flawless Execution begins with planning and strategic business planning begins with determining your objective. Whether an objective is small and short-range or very broad and long-range, clarity is essential. For short-range goals creating clear goals is usually straightforward and simple. But, as goals begin to stretch further into the future and expand in scope, achieving clarity becomes much more challenging. Personal, career, and organizational goals require a long time to achieve and great effort. They are the result of a multitude of smaller successful goals accomplished on a daily, weekly, monthly, and even annual basis. So, do the long range and the short-range goals look the same? Do they take the same form? The short answer is “No.”

Mission objectives – the short-range, small goals – are “present-based.” They are executed over a time-frame of no more than a month or so. The shorter they are, the better. It helps an individual or organization to learn, iterate, and improve rapidly. There is powerful psychology at work here. As the authors of The Leading Brain (Tarcher Perigee, 2017) claim, creating a “. . . a vivid image of success can sometimes trick your brain into believing you’ve already reached your destination before you’ve even taken the first step. . . . Instead of celebrating prematurely, the brain releases dopamine and increases your motivation in anticipation of impending success.” (Pg. 125)

Don’t long term goals also have to achieve the same thing? Don’t they have to be a clear vision the future? Of course they do and that is where most fail. Because scope expands greatly over time, long-range goals are extraordinarily complex. So, to define long-range goals, you must have a set of descriptions of success that form a complete whole. A single, clear statement won’t do. It needs to be a holistic, 360 degree vision of the organization and address all the major areas of the business.

For strategic business planning, we know the major areas that must be included in long-range goals. Peter Drucker first defined the set back in 1954 and we have used that early inspiration to develop long-range visions for a business. It must describe the future vision of the organization for a minimum of five balanced areas – financial, human, market, structure, and entrepreneurship. Further, each area can have more than one aspect to provide greater clarity. What it lacks in brevity, it makes up in clarity and completeness. We insist that organizations do this hard work and we call this vision the High-Definition Destination, or HDD.

I’m often asked if the HDD can be used as a long-range planning tool for individuals personally or professionally. The answer is yes, but with a few modifications. A career HDD has seven key areas – interests, advancement, money, security, people/philosophy, challenge, and location (IAMSPCL).  Want to expand that career HDD to a full-scope Personal HDD? Morph the categories to the following: health, family, spirituality, wealth and community service. Each requires a clear statement of what the future looks like at some particular date. When you put them all together, you will have created the high-definition, holistic clarity you need to focus and drive the specific strategies and actions necessary to build a mission plan and achieve success.