Strategy: Where Things Go Wrong

Marc Neal

Strategic planning is all the rage, business and organizations spend a lot of time and effort developing strategy and often fail to follow through with its implementation. Consultants are hired to guide them through the process of strategic planning and the result is a document that never gets implemented. We devote so much time effort and resources to this and get so little out of it.

To find the pitfalls in strategic planning we need to understand the what is needed to develop a strategic plan and what kinds of tools we can use to figure out what we need to do as an organization. Far too often we make this an academic exercise theorizing, and pontificating without going to the next steps of implementation.

Elements of a strategic plan

Mission Statement — the Mission statement is the aspiration of the organization. The mission statement is unique to the organization and can be anything from increasing shareholder value in a for profit organization, to delivering services specific to an underprivileged group of stakeholders… For a Not for profit it could be as simple as “Helping Homeless People” and a business could be “making profit by helping our customers find what they need”.
Vision — Where you see the organization in 5 to 10 years. For example; “We want to help reduce homelessness by 75% over 10 years”.
Values — those values that the organization adhere to such as honesty, integrity, ethics etc.
Environmental Analysis — analysis of the organization and the external environment it operates in.
Strategy — the strategy is the manifestation of and the steps you are going to take to systematically achieve your vision and the mission of your organization all while living within the values your organization holds. This should result in statements like this “To achieve our mission and our vision we must….”

The strategic plans are the operational goals an organization will do and is based on the solid foundation of the mission, vision and values of the organization as well as an evaluation of the current environment, both internal and external, in which it operates in.

Some of the best strategists can have an informal strategy that can be mapped out on a napkin and achieve great results with what appears to be no effort at all. Others spend large amounts of money and time, bringing in “experts” do not go anywhere and the efforts fall flat. Henry Mintzberg, considered one of the worlds preeminent experts in strategic planning, has been critical of the fad of strategic planning and in his 1994 book he has suggested that organizations had a counterproductive love affair with strategic planning. The exercise has become more important than the result. We have lost touch with the purpose of moving the organization towards an achievable outcome.

What is the difference between the person who is able to scratch out a strategy on a napkin and the person who relies on consultants, focus groups and endless hours of debate to end up with an academic paper that sits on the shelf and goes nowhere. I would venture to say that the person who is able to pull it off on a napkin has the following characteristics:

they embody the mission statement of the organization;
they have a clear vision of where they want to be;
they know what they value and which lines they will not cross; and
they have a deep and realist view of their environment.

HOW WE GO WRONG

MISSION STATEMENT

The Mission statement is the organization’s reason for being, and without that any strategy will be aimless. When looking at the Mission statement, the primary foundation element of strategy, the important characteristics are as follows:

hopes and dreams of the organization;
succinct summary of what the organization does;
it should be short, to the point and clear; and
call to action that members of the organization can stand behind.

The mission statement goes off track when trying to be too much for too many and the aspiration is vague, complicated and overly wordy. A good mission statement will have to stand on its own, be short and to the point and does not need volumes of explanatory notes to justify the statement.

Great Mission statements all have the same characteristics ; nothing needs to be added to them, they are understandable, and they describe the organization’s reason for existence. Here are some examples of great Mission Statements:

Nokia, “Connecting People”,
Tesla, “ To accelerate the world’s transition to sustainable energy”,
National Wildlife Federation, “Inspiring Americans to protect wildlife for our children’s future”,
Save the Children, “To inspire breakthroughs in the way the world treats children and to achieve immediate and lasting change in their lives’.

VISION

The short answer about an organization’s vision is essentially where do you see the organization in 5 years, 10 years… The vision is an end state, that end state must be tied to the environment you are operating in so is a moving target based on the dynamics of the internal and external environment. When I say a moving target, I am actually saying the target needs to be reevaluated on a regular basis. An organization’s vision in August 2019 was determined on a certain set of aspirations based on conditions at the time. The vision of 2019 will certainly be different from the conditions presented by Covid19 in August 2020, and so must be adjusted, since their situation has radically changed due to the pandemic. A business whose vision was to grow business by 20% now may be looking at a vision of surviving through the pandemic without sustaining large losses…

A vision statement that works must come out of the organization’s mission statement, its core values, must be achievable in a reasonable time frame and most importantly be coupled with an honest validated evaluation of the internal and external environment in which it operates. As with the example of Covid19 the organization has to look at the pandemic without imputing personal biases and wishful thinking into the evaluation.

VALUES

An organization’s values are the beliefs, philosophies and principles on which all actions and/or interactions are measured against. This list is essentially the standards you want to hold yourselves up to in everything you do from hiring staff through to customer/stakeholder interactions.

ENVIRONMENTAL ANALYSIS

The fellow who can come up with an organizational strategy on a napkin is acutely aware of his environment, has been brutal in his assessment of his organization’s weaknesses and strengths and can see with some clarity what are the major threats that he must guard the organization from and what opportunities our out there that can be capitalized on. The most common tool used for this in almost all organizations is the SWOT analysis, Strengths, Weaknesses, Opportunities and Threats. The biggest issue with the SWOT analysis is that it can result in endless debate, arguments and disagreement. Internal bias and personal pride make it difficult to accept weaknesses, people get defensive and often times the information is not much more than subjective speculation and the risk is that it can be invalid and possibly erroneous. Organizations often get caught in the trap of negotiation around wording and softening down the language which often times waters down the results. SWOT by committee is rarely a great idea.

For a tool like the SWOT analysis to work there has to be an honest try at getting an unbiased evaluation done and then followup to be sure that the results can be validated by data. The organization needs to know in what areas they are weak so that support measures can be implemented to deal with the weaknesses. They need to know where they are strong so that they can capitalize on those strengths. They need to understand what external threats that need to be guarded against. The organization’s leadership has to be in a position, by understanding its strengths and weaknesses, to be able to take advantage of opportunities. Given that this is the case any watering down of information gleaned from this exercise will ultimately result in a watered down, and possibly ineffective strategy.

STRATEGY

The strategy is formulated on and validated by the organization’s mission, vision, values and an unbiased evaluation of its environment both internal and external. The strategy should end up like an instruction sheet and look like; “we will do A to achieve C by implementing X. X will be the responsibility of the operations manager and will be fully implemented by April 2021.”… The strategy should be clear, concise, actionable, measurable and attainable. You will note that i have omitted the term aspirational. This is not an oversight, strategic objectives should not add any further aspirations other than the ones expressed in the mission and vision statements.

What the strategic objectives are, are a clear set of intermediary goals that need to be achieved to realize the vision of the organization. Each objective is evaluated against what the expected outcomes are and adjusted to make up for deficiencies by adding or modifying an initiative aimed at driving the objective.

SUMMARY

The pitfalls as have been illustrated are overcome by knowing your organization. Like the guy who writes a real strategy on a napkin, he knows what the mission is, he knows where he wants to be, and he has a deep understanding of what his organization/company facing in the current environment. These are the elements of how to develop an actionable strategy.

I have seen organizations which had no real formalized and documented strategies, but that does not mean they do not have a strategy. The organization’s leader has a clear way ahead, knows what needs to be achieved and puts the resources and people in place to achieve the results.

Debate is ongoing on how, to develop a strategy, should it be bottom up, top down, should it be inclusive, should it be collaborative, consultative or directed. To all this I have to say that it depends on the organization and the strength of its leadership, the clarity of vision that the leader has and the leader’s ability to rally the organization behind it. I can say, without reservation that the process of creating a strategy should never be the strategy in and of itself, it comes across as nothing more that a weak try at placating and/or misdirection. The result will always be a shelved document that cost a lot of time and money and may not ever be implemented.