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  • Writer's picturePhimation Strategy Group

Lessons from 2014 Planning

I am blessed with several clients who have embraced the idea of “measure twice and cut once,” and therefore have adopted a robust process for their annual planning. While most companies would say, “Why would you spend so much time on planning,” these companies have come to understand that time spent in planning pays off in spades through smarter decisions, better allocation of resources, and faster execution.

For these companies, my planning process starts in (gasp) August, so that we can have 4 monthly meetings starting in September. So, I was involved in 2014 planning for the last 5 months.

Mind you, I have other clients that planned 6-month goals for the first half of 2014 in just an afternoon. I’m not proposing a robust process for everyone – but everyone can learn from the more involved process.

What did I learn over the 2014 planning cycle?

It’s helpful, and an indicator of a strength, when the leader narrows the focus early in the process. For some clients, I start the process by asking the whole leadership team (a) what is important that’s happening in your world, and (b) of all of those things, what are the most important. With other clients, I have that discussion with just the CEO or COO, and then we come up with the 3-5 most important issues that we orient around for our planning with the leadership team. Would your leadership team trust and embrace the issues that your CEO came up with? Would your CEO come up with the right issues? If so, your planning can be more focused and efficient by starting the discussion with the short-list of issues. Remember, though, that you still need to describe a full picture of the many (often 15-20) issues that are occurring in the business, so that everyone sees the whole landscape.

A good process will make people strategic. One of the challenges I have as a strategy consultant is to make everyone on the team effective in a strategy process, even though many Stage 2 managers are not very strategic. How do I do that? By working through a process that (a) includes all managers in the whole process, and (b) helps everyone on the leadership team connect tactical, day-to-day issues with broader, big-picture issues. Admittedly, that takes more time in the planning process, but as change management consultant Randy Albert often told me, “You have to go slower at the start to go faster at the end.” Remember, though, that including everyone in the process does not mean that everyone makes all decisions – sometimes it’s just input, sometimes it’s just feedback.

The budget is where the rubber meets the road. I wrote a post last year about how important it is for your planning process to include both strategy and budgeting. With the environment still uncertain and/or resources still tight, this year’s planning cycle confirmed the value of the two parts. Budgeting without a solid rationale behind the allocation of funds is just guessing, and planning without honest decisions about limited resources is just hoping. Remember: at the end of your process, you should have a clear set of 3-5 company-wide priorities, and a “strategic investment budget” that identifies the specific funding and activities that support your priorities.

After taking a breath and recharging over the next few weeks, I’ll start working with some clients on their innovation and new venture portfolios, and the new places they can take their businesses over the next 3-5 years. I’ll write more about that topic sometime.

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