As a year comes to an end, many people and organizations reflect on how the year went and begin to formulate thoughts for the year to come. Those thoughts grow and evolve into plans with specific objectives that get socialized and subsequently blessed by peers and leadership for execution in the New Year.
January arrives with great excitement, enthusiasm, and optimism. None of them seem to last very long. People and organizations seem to run full steam into obstacles coming from the marketplace, competitors, their staff, or themselves.
The strategic plan that felt so well constructed now appears to be weak and wobbly out in the real world. Even if assumptions were reasonable when the developing the plan, things would change. Assumptions get tested. Unforeseen obstacles and factors that impact your plans suddenly appear.
I worked for one of Canada’s largest and oldest companies and fall was a planning period for the subsequent year. We would go through the process of informing our leadership of our intentions, justifying our approach, and seeking their approval. Once we had their approval, we were all set to execute when the time came. Unfortunately, when the time came, the execution did not always go as planned.
I am not suggesting that we were a bunch of idiots who devised stupid plans or we could not execute our way out of a paper bag. Like so many other organizations, we were wildly successful sometimes, modestly successful or experienced compromised success sometimes, or experienced utter failure other times.
It is the nature of a business that we go through this process regularly, regardless of the resulting outcomes. Many companies treat strategic planning as an event rather than a process. This leads to a thorough plan in a document, powerpoint, or binder sitting on a shelf never to be seen again in the future.
Even if strategic planning is treated as a process, the pace of change is so fast that we can become unnerved and lose confidence in the plans we have devised. Part of that could stem from the fact that we often make big bets that have a big cost associated with them, and the thought of tweaking those plans or fundamentally changing them leads to pangs in our stomach.
Those feelings of doubt and uncertainty cause many to rethink their plans and strategies and consider the “pivot’ – a fundamental shift in strategy that could be temporary to address current circumstances or could mean staking the future direction of the firm on it. No matter what, we should not be doubling down on the original plan.
Unfortunately, firms run the risk of making just as big a bet on the pivot as they did with their original plan and they could find themselves in the same situation again, doubting their strategy. Nobody wants that but it often what the get.
Jeanne Liedtka, author The Catalyst and Professor of at the Darden School of Business, spoke about the vicious cycle and virtuous cycle when it came to change and innovation within a company. The vicious cycle means we make big bets slowly, ignore growth opportunities, conduct exhaustive analysis, and avoid risk. The virtuous cycle means we make small bets quickly, experiment more and analyze the results, are open to more risk, and see the whole process as a learning opportunity for the organization.
If we took this same approach to our strategic planning and, rather than betting the entire year or business on ideas that are untested or formulated on narrow analysis, chose to work in short spurts or sprints like agile programming, then we might end of with more wins from all of our small bets.
I realize that this may sound rather optimistic, and you might be asking if my glasses are rose-coloured. I am suggesting an incremental approach to strategy development and execution. Prototype your ideas. Test them. Fail fast. Learn faster. I am talking about design thinking applied to strategic planning.
You may feel compelled to pivot because it’s February, and all signs point to your original plan losing momentum or failing outright. At least, you can feel less fearful and perhaps even more confident in the fact that you may not know everything but that you are going to learn more and likely succeed more through this new incremental approach.
It may be hard to get everyone convinced to make more, smaller bets than the few big bets they’re accustomed to making. Maybe you can convince them to let you try a few skunkworks projects in parallel to the plans they’re willing to support. Seeking their permission to experiment and to potentially fail can be a challenge. If you tell them this may cost X, but it will help the company avoid a loss of 10X from making a bigger bet, then you just might get them on your side.
Place your bets and good luck!