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Is a Strategic Plan Really Necessary?

November 27, 2016 Tags: , , , , , Mike Chirveno

You’re making money, customers are buying your products or services and your employees seem happy? Do you really need a strategic plan?  Isn’t strategic planning for big companies with lots of money and lots of employees?  Or maybe for companies that are struggling?  If things are going great, why mess with it?

Read the ten statements below, answer TRUE or FALSE, and we’ll chat at the end.

 

I know exactly what I want the business to look like 1 year, 3 years and 5 years from now.

  • I don’t mean you want to be making more money, I mean –
    • you have a clear picture of new product and service offerings
    • you’ve identified new markets or new target clients for growth
    • you have a plan for hiring and/or developing employees that can get you where you want to go
    • you’re already putting together the production, service and technical infrastructure to support the new products and market
    • you know how you’re going to finance your plans

 

When my leadership team meets, we talk regularly about long term plans.

  • Current operational problems are extraordinarily demanding and will consume all your time.  It’s good and right to talk about and solve them, but to borrow from Jim Collins, this is a perfect time for the “genius of the and”.  To remain viable in the long-term, we must effectively manage the organization today AND successfully position it for tomorrow.

 

The employees in my organization share my passion for the business.

  • You’re the boss, no one will care more than you – right?  You might be surprised.  Social scientists assure us that engaged, empowered employees will go far beyond just punching the clock.  Clear, concise communication and commitment to an overarching purpose are the starting place.

 

I know where we are vulnerable to competition.

  • A correct assessment of the competitive environment is much more than examining the companies that do the exact same thing you do for the exact same set of customers.  It also involves examining companies that compete for the same disposable dollars.  It involves surveying replacements for your good or service.

 

My employees know what success looks like in our business.

  • This might seem apparent, but unless you’ve assembled an easy-to-understand scorecard with hard and soft metrics, employees with very narrow job responsibilities might not know if the enterprise at large is succeeding or failing.

 

If I was gone tomorrow, the business would continue to function.

  • At the risk of sounding harsh, if the organization can’t run without you, you’ve built a cult, not a business.  Skilled execution of a strategic plan will force you systematize the business, building it around principle instead of personality.

 

I have a steady stream of new clients coming into the business and they are the clients I want.

  • New revenue streams, both from new products and from new customers are the lifeblood of any organization.  But as organizations mature and are better able to identify and serve the customers to whom they deliver the greatest value surplus, they can narrow their focus.  This focus allows them to build relationships with customers who are willing to not only grow the relationship, but also act as an advocate for the brand.

 

I have a process for identifying changes in the organization that would allow us to deliver our product better, faster or cheaper.

  • The inward-looking part of a strategic planning exercise focuses on the component parts of the value creation process.  How does the organization transform inputs into desirable outputs deriving the greatest amount of utility from the resources available?  The strategic planning process is about challenging the status quo, asking probing questions about procurement, people, processes, money and more.

 

I have a reliable feedback mechanism for customer sentiment.

  • Sam Walton observed that customers have the ability to fire everyone in the company from the CEO down.  That being the case, it’s critical to understand their perception of your products, people and processes.  A reliable feedback loop is the lifeline to these important stakeholders.

 

I have a plan of action to break and rebuild my business model to keep it fresh and safe from new, innovative entrants.

  • If you’re making money and satisfying an important customer demand, there are competitors who would love to take those customers and their money away from you.  If they can satisfy those demands better or more economically, your business is in jeopardy.  With an existing business relationship, you have an enormous advantage.  However, an unwillingness to innovate or even re-invent your business, product or service can be a shortcut to irrelevance.

 

If you answered FALSE to any of these, I believe you should very seriously contemplate a strategic planning exercise. It’s incredibly easy to cling to the status quo and not deliberately create and execute a plan to build a healthier organization going forward.

It’s incredibly easy to cling to the status quo and not deliberately create a plan to build a healthier organization going forward.

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Convinced and ready to go or still have some questions?  Either way is fine.  Click here to schedule a free, no-obligation thirty-minute conversation with me.  I look forward to learning about you and your business.

The Truth

October 27, 2016 Tags: , , , , Mike Chirveno

“Facts do not cease to exist because they are ignored.”
-Aldous Huxley

“The truth does not change according to our ability to stomach it.”
– Flannery O’Connor

“It is better to disappoint people with the truth than to appease them with a lie.”
– Simon Sinek

“and you will know the truth, and the truth will set you free.”
– The Holy Bible

No one questions the value of the truth, but in our businesses we sure have a hard time nailing it down. @cvconsulting

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No one questions the value of the truth, but in our businesses we sure have a hard time nailing it down. Most of us have read Jim Collins exhortation to “confront the brutal facts,” but reaching consensus on what those facts are can be challenging. How can this be? How can something so vital be so elusive?

I’m afraid we engage in some dangerous “truth-hiding” behaviors –

  • Have you ever told a subordinate, “Don’t bring me problems, only bring me solutions”? I understand what you were after – you want that employee to think for themselves and take responsibility for their work. Great, but you might be telling them that you don’t want bad news and if they don’t have an answer for a looming problem, you’d prefer not to hear it. You’ve just shielded yourself from a bit of the truth.
  • Have you ever spotted a new competitor on the horizon, but because you knew the principals in the organization from sub-par work earlier in their career you dismissed the threat? Maybe that earlier sub-par work motivated them to pair up with new capable partners or maybe they learned from their earlier missteps and are now a formidable competitor. You’ve just dismissed some truth.
  • Have you ever received a call or email from “that customer” – the one who is never happy – and dismissed the content of their communication as more sour grapes? What if this time they’re calling with a legitimate problem about your product or service or about a real misstep by one of your employees? You’ve just ignored some truth.
  • Is there a problem that keeps resurfacing in your organization and someone (peer or subordinate) has had the nerve to suggest that part of the problem might be you (your style, your time management, your lack of planning – you fill in the blank)? You discounted their observation because you’ve successfully run your division for more than 10 years and only have this problem with one person. Maybe there’s some truth there that you’re unwilling to hear.

 

If some of these resonated with you, great. If not, create your own list of other behaviors that could be keeping you from getting to the truth in your organization. You can even share them at the end of this post.

So, what are some positive steps we can take to make sure we’re getting a steady diet of the truth in our organization?

  • Make sure bad news can easily travel up and down in your organization. Make sure there are no reprisals for “truth tellers.” As a matter of fact, recognize their efforts in getting all the facts on the table.
  • Proactively ask for feedback from employees, customers and suppliers. Make phone calls and send surveys. Take the totality of the feedback to make a balanced, accurate picture of what it’s like to work at your company, purchase products or services from your company or sell to your company.
  • Engage the services of a third party who can bring a fresh perspective. Maybe a consultant, an advisory board or business-owner peer from a networking group.
  • Engage in vigorous discussions. Build enough trust inside your team so that you can talk to each other about failures in execution, faulty plans and blown opportunities. Commit first and foremost to the purpose of the organization. That makes the momentary discomfort of discussing individual lapses subordinate to the importance of resolving nagging problems or the exploiting of looming opportunities.
  • Squash every form of defensive behavior. When you hear things you’d rather not hear about your organization, your product or your people, resist the temptation to defend. Instead, figure out what you can learn from the feedback and teach your team to do the same.

 

I realize that what I’m advocating is difficult. It goes against our natural inclinations to defend our work and reputation. I also realize that taking feedback without defending could look like you’re being disloyal to the company, its products or its employees. There’s a great way to deal with that, but that’s another article for another day.

For now, let’s get back to the supremely important topic of truth telling. How can you develop your team if you don’t where they struggle? How can you retain clients if you don’t know where your current performance is deficient? How can you make an accurate strategic plan if it’s based on a flawed perception of today’s reality?

I saved perhaps the saddest “truth” quote for the end. In the 1992 movie, “A Few Good Men,” Jack Nicholson’s character, during a military court proceeding, told his questioner, “You can’t handle the truth.” Whether we can’t handle it or don’t want to handle it, the result is the same. We continue to live in deluded bliss while our organization perpetually stumbles along on faulty information, never reaching its full potential.