Bill Gaw's Back-to-Basics,
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Basic No. 01: Strategic Planning

By Bill Gaw

Strategic planning is a business process that most companies employ to identify critical success factors  that set the course for future growth and profits. Professional development and team training should be one of the plan's critical objective and budgeted accordingly.
 Lewis Carroll in "Alice in Wonderland" makes a good  case for it: "Would you tell me, please, which way I  ought to go from here?" said Alice. "That depends a  good deal on where you want to get to," said the Cat.  "I don't much care where...," said Alice. "Then it  doesn't matter which way you go," said the Cat.
 Like most business processes, the key to success is  the effective implementation of the plan. Companies  that do a good job of developing and executing their  strategies can create a competitive edge that provides  increased market share and higher gross profit margins.  Organizations that turn their plan into a "dust  collector" upon an executive bookshelf, will never  achieve their full growth and profit potential. 
 Most criticism of strategic planning is aimed at the  planning process. They question the validity of a plan  that has been based on market "guestimates", the  questionable valuation of the depth and breadth of  competitors and an optimistic assessment of the  company's internal strength and weakness.

The fact  that strategic plans can be overly optimistic is not  the core problem. Although the criticism may be  appropriate, it puts the focus for improvement on the  wrong end of the process - it is the implement-ation  task that is critical to producing positive results  and it is here where most companies fail at strategic  planning.
 Poorly implemented rational, strategic plans will  produce limited positive results. On the other hand,  overly optimistic strategic plans, effectively implemented, can produce results beyond every-one's  expectations. This being the case, what is the key to  effective implementation? In one word - commitment! 
Companies that are good at strategic planning build  commitment to the planning process and to each of the  strategies within the plan. They build commitment  throughout the organization, working with people from  all business functions to build commitment before,  during and after development of their strategic plan.
 Winners begin early in building a commitment to the  strategic plan. Suggestions are encouraged from  managers at all levels, from key executives who will  participate in the planning sessions, and others who  will share responsibility for implementing the  resultant strategies. Together, they surface issues  that will require changes in business process and/or  culture and identify those constraints that will need 
 to be overcome if implementation is to be successful. 
During planning sessions, key executives from each  functional area are all encouraged to participate and  contribute to the plan. These executives develop  strategies that build on organizational strengths and  consider resources required to accomplish those  strategies.

They assure that a key executive "owns"  each strategy and commits to a time schedule for its  accomplishment. The key executives give thought to  resource planning - realizing that human resources are  the key to making positive things happen in difficult,  complex business environments - and they commit  accordingly.
Following the development of their plan, those  responsible for implementations develop their own  "tactical plans." These action plans, when coupled  with self-directed work teams, are major contributors  to a successful Strategic Planning implementation.  

Teams use their plan to manage, to make decisions and  to grow their business. Periodically, they review  their "tactical plans" to monitor and report on the  progress of implementation - keeping the plan "alive"  by revising strategies and tactics when necessary.
Finally, to insure successful implementation of their  strategic plan, they work on the planning process  itself. The planning group continuously "fine tunes"  the planning process to insure that inputs from all  business functions are given their due consideration  and to insure that buy-in and commitment to the final  plan is agreed upon throughout all levels of the organization.
So, why are most operations management teams outside of the strategic planning process? Why do many line  managers view strategic planning as a make work  project that produces little or zero value to  customers? Maybe, it's because they did not  participate in its development nor did they buy-into its validity - let alone commit to the execution of  its strategic objectives.

In short, they're not  connected to the process! To achieve a company's full  growth and profit potential, CEOs and business owners need to insure the active participation of operation management in the strategic planning process.


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