Strategic Planning

The purpose of writing a Strategic Plan is to create amongst all employees a shared understanding of WHO the organization is, WHERE it wants to go, and HOW it intends to get there.

In his book “Good to Great” Jim Collins introduces the Hedgehog Concept. The hedgehog is characterized to be much focused and doing one thing very well. To understand where to focus, organizations have to understand what sits at the intersection created by the answers to three questions: i) What can you be best in the world at? ii) What are you deeply passionate about? iii) What drives your economic engine? Understanding what we can be the best in the world at, are really passionate about and understanding how to make money at it is a good start. Collins says it takes on average four years for the good-to-great organizations to clarify their Hedgehog Concept, and they did this through an iterative process. This is true for strategic planning, you have to create a first Vision Manifesto, and then keep working it. The Vision Manifesto, is the materialization of an organization’s Hedgehog concept. You need to work at it over time because, as you implement and execute the strategic plan, the world changes, you and your organization change, you learn from your successes and failures, and this learning needs to recycle back into your strategic plan.

In their book “Blue Ocean Strategy” Chan Kim and Renée Mauborgne introduce the concept of a “Strategy Canvas” that “captures the current state of play”⁽¹⁶⁾. In order to do so, it is fundamental to understand the market, the existing customers, the competitors and start looking at space not yet occupied. In our language, a Blue Ocean Strategy is analogous to an ideal strategic plan. We also agree with Kim and Mauborgne that what separates winners and losers is their approach to strategy making.

Because of the significance of the choices being made and their impact on the success of the organization, the creation of a Vision Manifesto is evidently a share responsibility between the Board of Directors and the Senior Leadership Team. Strategic planning is about being creative, motivational and invoking willing commitments. Strategic planning is more about assembling the collective wisdom with the purpose of creating a “new” big picture, than it is about top-down or bottom-up planning. As Albert Einstein once said “If I can’t picture it, I can’t understand it.”

There are several critical components to the development of an effective strategic plan. Kim and Mauborgne call this step the creation of “strategic canvas” which captures the current state of play, and will allow the reorientation of an organization’s strategic focus, from competitors to alternatives, and from customers to non-customers. The creation of a strategic canvas requires that you ponder on and bring clarity to the following components:

Core Ideology [WHO is the Organization]

Know Thy Fundamental Belief
Declare a Culture encompassing Core Values and a Core purpose

Core Vision [WHERE it wants to go]

Core Strategies [HOW it intends to get there]

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Published at 20:01

11 March 2011