The new buzzword in business is “pivot” – a key indicator of an organization that is not only market-aware, customer-focused, and employee-driven but is also, the highly desirable outcome of an organization that has deliberately developed the speed, agility, and flexibility to thrive despite the increasing rate of change.
This 3-part series will help you jumpstart your ability to respond quickly by up-ending one of the greatest barriers in the way of speed, agility, and flexibility – the standard approach used by most companies to strategic planning.
We’ve all engaged in strategic planning retreats in the past… but what about pivoting to a strategic thinking advance? You should always advance instead of retreat!
CASE STUDY #1
I was privileged to see a $50M Manufacturing company pivot on a dime as a result of a strategic thinking advance I conducted with their team. Their previous strategic planning efforts had focused on becoming “BIG” – their BHAG was to become a ½ billion dollar company. Unfortunately, that really didn’t inspire their employees, who were rural craftsman who saw nothing in that for them.
Instead, they developed what I call a LEgendary Outcome or LEO (outcomes you can recognize, experience, and celebrate, BHAGs are often so far in the future that they seem ethereal) that was all about visibly claiming their leadership role in the entire industry, which many of these craftsmen (and women) felt in their heart they deserved but had never achieved. Talk about spurring an organization to greatness!
Almost overnight they pivoted. They still had a growth goal… but it was one that everyone saw as important and achievable within the next 10 years. Behaviours shifted to focus on the Outcome – from having a massive strategic ‘to-do’ list to having strategic themes that empowered employees. It enabled them to create the kind of wows in the moment in every interaction with a customer, and in every area of the business, every day that would lead them to their Legendary Outcome.
Are you stuck in a rut?
Ask yourself what stage in the history of strategic planning is your organization at today. In the early 1920s, Harvard Business School developed the Harvard Policy Model, one of the first strategic planning methodologies for private businesses. This model defined “strategy” as a pattern of purposes and policies defining the company and its business. Are you stuck with rigid policies in a fast-changing world?
Through the late 1950s, strategic planning’s focus shifted away from organizational policy and structure toward the management of risk, industry growth, and market share giving rise to such tools as the SWOT analysis model and a portfolio approach. Really? When was the last time your conventional SWOT actually made a difference in your business when every rise or fall in the dollar, every election, every change in the price of oil presents a new set of threats and opportunities?
The 1960s brought the industrial economics model and highlighted the relative power of customers and suppliers, and a focus on threats posed by substitute products and services, new industry entrants, and market rivals dictating competitive strategies. Are you more concerned about what your competitors are up to than you are with innovations that would simply make them irrelevant?
During the early 1980s when computers were in their infancy and nobody had ever heard of the internet, the shareholder value model and Michael Porter’s ‘Five Forces’ model became the standard. More than 30 years later, it is still a de facto standard; although, the world has gone through multiple iterations since then. Could anyone in your organization competently describe the forces acting on your business?
The rest of the 1980s and beyond was being dictated by strategic intent, core competencies, and market-focused organizations. Tom Peters’ In Search of Excellence championed this… although most of the businesses profiled in that book are no longer in business.
In the 1990s and beyond, strategic planning focused on stakeholder value, including adaptability to change, flexibility and learning organizations. Built to Last and Good to Great became overnight sensations… although many of those companies followed the same fate as Tom Peters’ and Collins more recent book was aptly titled How the Mighty Fall.
Do any of these feel like the right approach in a world of globalization and economic turmoil?
Many of us were taught these approaches to strategic planning, and have dutifully attended the strategic planning retreats, worked through the various models, produced the massive binder full of detailed plans… and then put it on the shelf with good intentions to execute. Then, business as usual resumes. Sound familiar?
At the end of the year, that planning process typically results in a lot of missed goals and expectations. Only in rare cases are the support structures in place to flow the plan throughout the organization and engage everyone in an ongoing process to make it happen. Only rarely does the plan become a living, breathing force for the organization. Only rarely is it flexible enough to offer the right blend of being grounded yet agile.
Key #1 of 3 Play Your Business Like a Chess Game:
Conventional strategic planning is often akin to trying to tell someone how to win a chess game by outlining every move for them. Unfortunately, as soon as the opponent does something unexpected, the master plan goes up in smoke. Continuing to play the game the way you told them to will simply result in a loss.
CASE STUDY #2
I loved attending Warren Buffet’s Berkshire Hathaway AGM a few years ago. Two-time U.S. chess Champion Patrick Wolff playing against 6 opponents at once… blindfolded. He had enough “strategic plans” in his head based on experience that he could pivot on a dime. As each of his opponents made their moves, he could “see” the game unfolding, and knew what counter moves would lead to checkmate. He beat every single opponent (many of them respected chess experts) in a remarkably short period of time. Unless you have a photographic memory of every detail of your plan, such deep knowledge of the great game of business, that you can offset moves by the economy, your competitors, and your employees while blindfolded, the “every move in advance” approach is doomed.
Strategic thinking is what separates great chess players from the rest, as they identify many potential upcoming moves and select the most advantageous as circumstances evolve. Strategic thinking takes the time to ask the right questions to identify what winning looks like. It engages everyone in challenging “business as usual” thinking. And strategic thinking provides the mechanism for a living, evolving plan of action that delivers results. Here’s how:
- Ditch the Binder: When I facilitate strategic thinking advances, organizations develop a simple 1-page plan that creates alignment from their organizational goal to a series of theme statements for each of the upcoming years that help them move confidently in the right direction. By their very nature Theme Statements build speed, agility, and flexibility into the organization, because they’re direction markers, not carved in stone.
- Empower Ingenuity: One layer down, we identify no more than 5-7 core outcomes that have to happen during the year, but they are kept at the level of the “what” not the “how” – and ensure that every employee is crystal-clear on the desired outcome so that they can apply their ingenuity to determining the best way to reach it.
- Accountability: With great freedom comes great accountability. Every employee needs to know where they fit, why they matter and be held accountable for delivering as promised. With a simple one-page visual, it’s clear who is performing and who’s not, the peer factor kicks in to deal with missed goals and deadlines, and the rate of achievement skyrockets across the organization.
Rethink whether you want to do a conventional strategic planning retreat this year, or make the leap to a strategic thinking advance. In the next two blog posts, I’ll share more about how to create the transformation from retreating to advancing.
Most firms do their strategic planning in the summer or fall. What will YOU do differently this year to transform your Retreat into a Strategic Thinking Advance?