In last week’s post, Strategic Planning: 12 Common Mistakes (Part 1 of 2), we explored the first six of 12 common mistakes made in corporate strategic planning. This week, let’s look at six more common mistakes to learn from and avoid making.
Before moving on, here is a recap of 1-6 from last week:
- The timeframe of the plan is too long
- Too many strategic goals
- Goals not tied to measurable outcomes
- Employees are unaware of the goals
- Key vendors and partners not considered
- Plan leaves too much room for interpretation
Now let’s examine mistakes 7-12 on the strategic planning no-no list:
7. Job descriptions not aligned to desired strategic outcomes
When job descriptions and job responsibilities align with corporate goals, organizations see better results in strategy execution. Job alignment helps achieve accountability and also fosters needed cooperation from individuals throughout the organization. When job descriptions and responsibilities are effectively communicated to employees and when additional responsibilities are given to them related to accomplishing tasks related to strategic goals – these individuals become tuned-in with their roles and the expectations surrounding them. The goal is to create empowered team players.
8. Performance measures not aligned to organizational goals
Adding to the above, organizations must set performance measurements and incentives for employees and officers. These performance measurements should be derived from the job descriptions and job responsibilities, and the resulting incentives must be strong enough to empower all layers of management to measure and manage efforts toward the achievement of plan goals. While this adds a layer of complexity to the organizational planning process, neglecting this step will result in subpar performance.
9. Organizational culture is overlooked
The corporate planning process must consider the organizational culture. Without this, it is impossible to fulfill the organization’s potential to dominate within their marketplace. Culture determines how the organization functions and how work will be completed. Aligning strategy, tactics and governance to address these dimensions will positevely affect the outcome of planning efforts.
10. Customer value is overlooked
Customer-centric planning puts your number one stakeholder – the end customer – at the forefront of the organization’s activities and goals. By creating goals that reflect the type of value the organization can create for the customer, you’ll “put a face to the name” and more effectively connect members of the organization with the desired outcomes. This requires a competitive analysis in order to understand positioning, threats and the true current-day value proposition of the organization’s offerings. Not all goals need to be customer-centric in nature, but overlooking this aspect during planning can lead to missed opportunities.
11. Operational planning is overlooked
An effective corporate planning process allows the organization to plan strategically at the enterprise level and then operationally at the business unit level with each part supporting the other. Failing to reach all the way down through the organizational layers is a common problem with corporate planning processes. This is where inadequate budgeting can come into play, resulting in resource constraints that will undermine the plan’s execution down stream. Strategic planning, to be effective, must address the entire business ecosystem – from top to bottom.
12. Cyclical and seasonal peaks and valleys overlooked
It is well-understood that organizations must balance the realities of financial budgets during the corporate planning process. Yet, the organization must also take into account relevant economic cycles that will impact the strategy over time. Economic cycles will affect market conditions, access to capital, energy, focus, and many other factors (both positively and negatively) to inhibit or accelerate an organization’s ability to accomplish its desired outcomes. To the extent that economic and cyclical factors are understood and anticipated, the organization can build a layer of realistic contingency into corporate plans that address the peak workloads of workers, budget cycles and many other factors – thus improving the realism of the plan and ultimately the results.
This list is not intended to be all inclusive. There are many blunders that can bring a good strategy down during execution, but the list we have covered addresses many common mistakes that should be avoided or corrected.