Strategic planning is an extraordinarily complex and integrated topic that requires analysis and consideration of individual and organizational psychology, psychographic, and social-technographic information in addition to KPIs and market data. It is a phenomenal effort of data analysis, many branches of study, and wide ranging implications. Perhaps, it is for this reason, or the fact that there are many types of planning – including business plans, marketing plans, business development plans, etc. – that many people find it confusing. When looking back at my previous work, I realized that I have covered specific topics within the realm of strategic planning but have failed to give a generalized overview. What I’ll attempt to do succinctly in this article is give you a bit of strategy 101.
Strategy is a set of goal-directed actions a firm can take to gain and maintain a sustainable competitive advantage. The competitive advantage being relative, it defines the differentiated practice/property where a firm can create value for its shareholders and stakeholders. Therefore, strategic planning is meant to provide the roadmap connecting a firm’s mission to its vision. It functions to provide clarity, direction, purpose, alignment, and clear messaging. Fundamentally, regardless of the framework or philosophy you follow, you want your strategic plan and process to accomplish a few things. While it may not be a comprehensive list, you want to drive transparency, ownership, adaptability, and alignment within a system that is consistently practiced and produces results.
There are three basic phases or stages of the strategic planning process – research, design, and implementation. When thinking about these three stages, you can fundamentally say that research happens with as broad of a cross-section of stakeholders as possible, design occurs from the top down, and implementation happens from the bottom up. I’ll briefly describe each phase and spend most of the time within design as it allows us to describe and define the core components of your strategic plan.
Stage 1: Research
During this stage, you are looking for objective and subjective data that relates to the history and state of the firm today. At Zweig Group, we generally like to look through a minimum of four lenses within our analysis: the financial perspective, the employee experience perspective, the client experience perspective, and the operational (organizational structure, project management, HR, IT, marketing, etc.) perspective. Gathering this data may include surveys, benchmarking, modeling, interviews with key stakeholders, competitive research, defining growth vectors, and more. It is then compiled into a fact-based assessment of the firm to provide a common understanding of the firm’s platform for the future to every person who will be involved in the strategic planning design meetings.
Stage 2: Design
This stage traditionally consists of an off-site planning session with eight to 12 of the key stakeholders within the firm, although variable and virtual formats have recently been explored. The goal of this stage is to take into consideration the vast amount of data that has been compiled in stage 1 and design the roadmap for the firm to achieve its goals/ambitions. The outcome of this stage must be an actionable plan that defines how your firm will drive purpose and performance.
The first thing that must be agreed upon is the planning framework/hierarchy. There are tons of frameworks from OKR to EOS, but I’ll briefly mention five of the best frameworks that I’ve run across and then describe the hierarchy Zweig Group generally recommends.
1. The balanced scorecard – Great for midsize to larger organizations that want to ensure their goals cover the main aspects of a successful business.
2. The Ansoff Matrix – Great for organizations that are about to embark on an aggressive growth strategy and need help defining their plan of attack.
3. McKinsey’s Strategic Horizons – Great for organizations that have decided that innovation is a critical part of their strategy.
4. Value Disciplines – Great for organizations that are looking to fundamentally reposition themselves in the marketplace.
5. The Stakeholder Model – Great for organizations where stakeholders are the core of what they do, such as non-profits.
At Zweig Group, we leave the design stage with the following defined and built into an actionable plan that gives our clients the three- to five-year strategic plan, action items for the firm to progress in the next quarter, a communication plan for rollout, and an implementation plan. At the strategic objective level and below, each component has ownership, measurables, and timelines at a minimum. I’ll briefly define each component and give you a guideline for the duration of each. As you move down, each level is nested within and guided by what comes above it.
• Vision (potentially indefinite) – The why. It is an articulation of a view of the world that your company and your people are working toward (just cause/purpose), not what they are expected to do now. It is a vivid picture of where you are headed to motivate others to take that journey with you.
• Mission (potentially indefinite) – This serves as a filter to determine what is important and communicate an intended sense of direction to the organization. Simply put, this is what the firm is doing to achieve the vision.
• Core values (potentially indefinite) – A culture is defined by the values in action through behavior. Values are unwavering principals that infuse culture with purpose.
• Strategic objectives (duration of plan) – Statements that indicate what is critical or important in your organizational strategy.
• Strategies (1 or more years) – The basic philosophies that guide us in critical business areas.
• Initiatives (about 1 year) – What are we going to do? Specific programs, procedures, or policies.
• Actions (about 90 days) – The specific steps taken to advance and complete the initiative.
Stage 3: Implementation
This is where the rubber meets the road. I’ll save an in-depth review of implementation for another article, but the importance shouldn’t be understated. If strategic plans are to fail, it generally isn’t in the design, but in execution. At a minimum you need to think about the tools, resources, and structure you have available to carry forward your plan. We generally recommend a minimum review cadence of monthly performance reviews, quarterly assessments (what is in the plan and what needs to be adapted), and a yearly strategy refresh.
I hope this brief overview of strategic planning was a helpful introduction. It is an incredibly deep and potentially nuanced practice that every firm needs to consider. Zweig Group is here to help. Please reach out to any member of our team with additional questions or for help with your next strategic plan.
Reach out to Phil @ Zweig Group. He is always happy to talk strategy!
Reposted in The Zweig Letter on August 7, 2022.