Businesses rarely find success by making decisions by the seat of their pants. For this reason, business planning has been a staple of the successful company model. It requires leaders to formalize their goals, reasons why said goals should be pursued and how they will be realized. Sounds like Business 101, right? Now, more organizations are investing in and revising how they use strategic planning for their companies.
While business planning may on its face seem strategic, the strategy mandates HR and C-suite leaders redefine how they approach the future.
“You can think of ‘strategic planning’ as a blueprint.”
What is “strategic planning”?
If business planning is more like a formal statement of purpose, you can think of company “strategic planning” as the blueprint. The design, or end-goal, is already known, and users can now work toward it by focusing on where and how to spend money, time and human capital.
For companies that use strategic planning, what is the most important part? Alignment. Ensuring coordination across units and departments so that all the various projects come together in service of an overarching goal is not only critical to success, both long- and short-term, but it’s also one of the most difficult things to achieve. In fact, MIT Senior Lecturer and Researcher Don Sull told Harvard Business Review that 40 percent of business leaders cited failure to align as the greatest challenge to executing company strategy, with failure to coordinate across units a close second with 30 percent.
What to avoid when creating a strategic plan
There are a few pitfalls businesses can avoid when creating or revising strategy that will help them paint a detailed picture that still has the end design in clear sight rather than leaving the C-suite scratching their heads.
As Logan Chandler urges in a separate article for Harvard Business Review, business leaders should look past the template. While templates can prevent flights of fancy from taking hold, they can also shackle business strategists to the past.
“The rigid use of templates can lead a team to be more focused on corporate requirements than on doing the hard thinking about how they plan to grow their business,” writes Chandler, adding that the it can result in “stale ideas, rote responses and plans that don’t fully capture – or worse, obscure – the key issues and opportunities that a business needs to address.”
Additionally, strategy can often fail as a result of a failure to communicate its purpose and goals with all employees. Forbes notes employees must be included in the implementation process. Without full communication of a strategy – its goals and processes – workers could unknowingly contribute to its misalignment. Leaders must take this a step further as well so that not only do employees understand the design but also the role their position plays in it, thereby creating buy-in and engagement.
Fortunately, businesses and organizations increasingly have tools at their disposal that allow leaders to connect strategy to people as well as easily and efficiently update and communicate strategy as priorities shift.