(Picture: waterslide at Florida amusement park)
Strategic Planning: Navigating Your Business to Success
Early in my executive career, I remember sitting in a strategic planning session thinking, there is no way that this whiteboard session is going to come to reality. The goals lacked clarity, they were overly ambitious, and did not have a clear direction on how to get there. It was worse than a New Year’s resolution to lose weight. It was like they were asking me to grow in height. Unfortunately, I was long past the growth stage, and so were this organization’s whiteboard dreams.
Today, we break down four key principles of strategic planning to guide your company to exceed your expectations. As Walt Disney said, “All our dreams can come true, if we have the courage to pursue them.” If we use the right principles, we can often reach our destination by navigating our strategy with purpose.
40 Strategies Value Driver
Principle #1 – Setting Your Destination
Understanding your current business position and knowing your destination are crucial. When it’s not there, it feels like walking around Disney World in the Florida summer heat; without a clear destination and a map. The adventure of a lifetime becomes frustrating, aimless, and sweaty. This is where strategic planning becomes your compass, guiding your business towards value creation and, possibly, attracting additional investors. By presenting a clear roadmap of where you’re heading, you not only set the stage for your journey but also define the milestones, or harbors, along the way.
The concept of ‘destination’ instead of goals is central to our approach at 40 Strategy. We prefer this terminology because it emphasizes the importance of reaching your target. According to Forbes, only 6% of New Year’s Resolutions ‘stick’ after one year. That is not aspiring. However, we believe in learning from the 6% who succeed against the odds. Their success lies not just in setting goals but in the planning of their journey towards the destination.
Principle #2 – Planning Your Journey
Imagine boarding a plane; you expect to reach your intended destination at the estimated time. This expectation of precision and planning in air travel mirrors the approach businesses should take. Aiming for a destination with a high success rate significantly improves your chances, compared to the uncertain outcome of vague goals.
Strategic planning isn’t just about setting a long-term vision; it’s about breaking down the journey into manageable sprints. Whether it’s a three-year destination or a one-year ‘harbor’ goal, progress is within reach with the right resources and a clear path.
Consider flying to Orlando: there are multiple routes and modes of travel, each with its own set of trade-offs in terms of cost, time, and convenience. Similarly, in business, multiple strategies can lead to the same destination. The key is to select the journey that aligns best with your goals, resources, and timeline. You want to end up in Disney World, not the gator infested swamps of the Everglades.
(Picture: Flying to Orlando)
Principle #3 – Leading vs Lagging Indicators
A critical aspect of planning is the distinction between leading and lagging indicators. While lagging indicators measure outcomes, leading indicators predict future performance to reach your destination. Most organizations rely heavily on the outcome, typically 80% of strategic indicators are lagging. We flip the script, recommending 80% of the indicators should be leading; rather than lagging.
We need to focus on the things that we can control, leading actions. For example, you cannot guarantee a customer will sign your contract, but you can control the customer interactions, such as contacting prospects, hosting product demos, and delivering your quote timely. This focus on the things that you can control is essential for tracking progress and adjusting strategies as needed to not only meet your lagging indicators, but to exceed them.
Principle #4 – Prioritize Your Strategies
Another pillar of our strategic planning process is prioritization. The Pareto Principle, or the 80/20 rule, suggests that approximately 20% of your efforts will produce 80% of the results. By applying this principle to goal setting and strategy development, we focus on the “essential few” actions that will drive the majority of outcomes. This approach helps avoid the pitfall of overcommitting on too many goals, one of the most common reasons for failure according to the Four Disciplines of Execution.
At 40 Strategy, we specialize in facilitating companies to develop robust strategic plans that significantly increase their chances of success. Despite the low success rate of both New Year’s resolutions and strategic plans—where, according to Harvard professor Robert Kaplan, 90% of strategic plans fail —we aim to ensure your business is among the top performers. By adhering to our core principles, including setting a three-year destination, defining short-term goals (harbors), choosing effective strategies (journeys), and focusing on the most impactful actions, we guide businesses towards achieving their visions.
The journey of strategic planning will be successful by following our strategic principles that we outline in our CAPTAIN Strategy methodology from Lost at CEO. Working with our clients and in our book, we dive deeper into these principles, offering insights and guidance to help businesses navigate their path to success. The stark reality of high failure rates in strategic planning and resolutions emphasizes the need for a focused approach. By adopting the strategies outlined, you position your business not just to aim for success, but to reach your destination, by standing out among your competitors, and often fulfilling your dreams.
Did you know, that our Lost at CEO, eBook, is currently available on Amazon for $0.99? Buy now.
(Picture: Pareto Principle)
Measure Success Podcast
Jimmy Burroughes | Leadership Unveiled: Beating Burnout and Building Trust
Listen to our podcast episode featuring leadership expert Jimmy Burroughes, where we explore effective strategies to combat burnout and foster high-performance teams. Learn from Jimmy’s extensive experience and insights on building trust, strategic planning, and maintaining well-being in the workplace. This episode offers valuable advice for leaders seeking to inspire their teams and create a sustainable high-achievement environment. Jimmy hosts his own podcast and is also the author of Beat Burnout – Ignite Performance.
- Key Topics Covered:
- Balancing high performance with mental health
- Building and maintaining trust within teams
- Strategic planning to prevent burnout
Discover actionable tips and deepen your understanding of leadership and team dynamics. Tune in to transform your approach to leadership and team success.
Ian Peterman
Next week, Ian Peterman explains to us the way for conscious design thinking and tells us about his book Beat Burnout – Ignite Performance, his podcast and his public appearances. His methods for prioritizing restorative, sustainable, and inclusive values to build a legacy of positive impact for his client’s brands has offered an exciting and rewarding approach to the future of good business. He founded the Peterman Design Firm, which helps its clients commercialize sustainable and inclusive products and brands, and consults brands who want to create positive impact.
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