Plan to Succeed
Three Key Criteria of a Meaningful Strategic Plan
In 1980, Fortune Magazine published a prestigious list of the top 100 American public corporations based on revenues. By 2001, 26% of these companies were no longer on the list. Some were no longer even in business.
The question is, did these companies plan to fail or simply fail to plan?
If you asked their key executives, they would likely tell you that the companies struggled with strategic planning – the critical process of defining clear organizational goals and developing strategies to reach them. A strategic plan gives a company its direction, helping its leaders navigate the often-treacherous waters of today’s ever-changing marketplace.
The Importance of Planning
Do you remember when “The Big Three” defined the standard for quality and excellence in automobile manufacturing? Times have certainly changed. In recent years, globalization and the rapid growth of technology have created an increasingly dynamic, complex, and hyper-competitive business environment.
The effect of this accelerated change is clear: if your corporation is not planning to control its own future, your competitors will control it for you. To survive, your business must plan to succeed.
Does Your Business Plan to Succeed?
There’s a big difference between planning and planning to succeed. If you’re unsure of the difference, ask yourself the following questions: Do the leaders of your company have a meaningful strategic plan? Is that plan understood and endorsed by your executives? By your employees? Do your employees even believe what their leaders are telling them?
According to a 2005 Harris poll, only 37% of American workers believe that “top management displays integrity and morality.” Many other studies point to a major disconnect between CEOs’ and employees’ beliefs.
These studies demonstrate what you may already know in your gut: corporate malfeasance is not the sole reason companies fail. Most businesses fail because their leaders fail to adequately prepare the company to deal with change. It is critical to see past day-to-day pressures and plan for the long term. But even if you develop a sound strategic plan, it won’t lead to success unless your employees understand and support it.
The Three Criteria of a Meaningful Strategic Plan
Given the rapid pace of change in business and the disturbing disconnect between employer and employee beliefs, how do you create a strategic plan that will ensure your company’s continued success? You have to make your plans meaningful – to everyone in your company – by doing the following:
- Treat your strategic plan as a living entity.
- Make sure everyone understands and buys into your strategic plan.
- Consistently implement and execute your plan.
Treat Your Strategic Plan as a Living Entity
Think your strategic plan should be written in stone? Then consider this: barely thirty years ago, electronics industry experts believed that IBM’s mainframe would be the dominant computer of the future. Obviously, competition and shifting world conditions can change things. To manage variables like these, you must treat your strategic plan as a living entity.
According to Charles Koch, CEO of Koch Industries, your strategic plan should be a living entity built upon “a business vision that begins and ends with value creation.” He should know what he’s talking about, under his guidance Koch Industries has grown to be the largest privately owned company in the world. Since 1960, investments in his company have provided a rate of return 16 times greater than the S&P 500.
But how do you treat your strategic plan as a living entity? Review it and if necessary modify it. When conducting your review ask for employees’ input. Their front-line experiences provide a unique perspective, offering invaluable opinions and knowledge. Additionally, make sure you assess your plan from the perspective of value creation. Ask leaders and employees if your products and services will still be creating value next year, in five years, even in 10 years. Answering these tough questions and making plan revisions, if necessary, will help your company stay ahead of the curve.
