It’s May and that means budget time. Oh, and strategic planning. And most strategic plans suck. They’re often lumbering beasts, full of fancy words, and not that useful.
Strategic plans can be extremely helpful if they're done correctly. They can be clear guides on the right action that moves you in meaningful work towards a goal that matters. I recommend Stacey Barr's book, Prove It, for the definitive guide on how to develop measures that matter and a strategy that works.
When it comes to strategic planning and strategic thinking, leaders often do it backwards.
This is typically what happens around budget time: Quick, let's write the budget. How much money do we think we're going to need to spend? How much money are we currently spending right now on the basics? What are we going to do to make more money? What's our income target for the year?
Starting with targets is absolutely the wrong way to go about it. There is no context or meaning to it.
The other big mistake is not having a plan at all. That's being a reactive thinker. Leaders go in to survival mode and scramble to get work in the door to keep the doors open.
A third mistake is ‘weasel’ words. This is Stacey Barr’s term. What she is referring to is corporate speaking jargon. You might have something in your strategic plan like, “Our mission is to be the most effective organisation with sustainable outcomes.” What the hell does that mean? What is sustainable? What is effective? How can you see that? You can't see that. That is not a viscerally rich picture of anything.
Be mindful as you have a look at your corporate speak problems in your strategic plan. You might also want to check out Gabrielle Dolan’s Jargon Free Fridays.
Another mistake is combining targets, milestones, and projects as KPIs. An example of a poor KPI is “produce a magazine”. This is not a KPI. This is a project. A KPI is a measure of activity results. It's not about producing something in a one off. It's something that can be tracked as either improving or getting worse, such as customer happiness. How do you measure happiness? You start by asking, what does a happy customer do, say, feel? When you start asking questions like that, all of a sudden, you have pictures of happy customers. What do happy customers look like and sound like? Happy customers brag about their work with you. Happy customers tell you how much they enjoy working with you. Happy customers write testimonials. All of a sudden, you have a way to measure that. You can measure the amount of testimonials you receive per month or per project. You can measure the amount and quality of feedback.
Key tips on strategic planning:
Start with results.
Instead of thinking of targets, such as ‘how much money do we want to make’, ask, ‘what results do we want to produce through our work?’ Keep asking why is that important until you get something meaningful. Here’s two of mine: “Organisations improve their contribution to community and planet” and “Leaders enjoy their work and lives.” That's the bigger picture purpose of my business.
Next, focus on the result areas that you want to work on.
Maybe it’s client happiness. Maybe it’s return on time invested. Maybe it’s quality of service.
Next look at the individual results.
Then you develop measures for that. If we look at developing measures for client happiness, what do you see people doing, saying, feeling, or experiencing as a result of your work? Once you have that, you can start to be able to measure improvements in performance or activity. Then, you can set a target for that. Once you know what the baseline is, you can set an improvement target. Your baseline might be one testimonial a month. Maybe your target is to get three per month.
Once you have a target, you ask, ‘how do we improve that result?” Now you're doing strategic thinking.
Basically you reverse engineer from the desired results back to the strategic initiatives.
The process is:
• What is the result?
• What is the measure?
• What are the targets?
• What are the improvement initiatives or the strategic activities that take place?
• What budget do we need to create those results and manage those initiatives?
This is such a radically important idea. It sounds so simple. I just want to go ding some bells around it! Ding, ding, ding! This will transform how you do strategy, and thus the results you get.
Results, measures targets, improvements. It's a neat step by step. See Stacey Barr if you want to learn from the master. WWW.STACEYBARR.COM
This is linear thinking and it has some clear benefits.
The benefits are:
There is a starting point and end point and it has progress bars. I love progress bars! That's when you measure. You have something that shows where you’re improving or not, such as a fundraising thermometer. Progress bars are extremely motivating, as Dr. Jason Fox has written in his book, Game Changer.
These are all characteristics of linear thinking that are extremely useful at any stage of your leadership development. The benefits of linear thinking are that it shows progress, which we mentioned is very important for motivation. It creates a sense of achievement, which is also important for motivation. It creates movement and momentum. This is really important to getting off the ground and getting into action. Linear thinking has huge benefits.
We can become even more effective than a linear thinker. And that's being a systems thinker. Why? Because it allows you to be a lot more nimble, responsive and proactive in planning.
So, how do you do that?
It starts again, with ‘why’.
That part of the linear thinking also applies to systems thinking. You need to be purpose driven in your focus. Your ‘why’ for what you're doing needs to be deep and powerful and meaningful to you and the people that you want to engage with. That's the first aspect of becoming a systems thinker.
We then build multi-level plans.
We focus first on results for business. The next layer of the multi-level plan is look at the systems that produce those results. Now you're starting to move into systems thinking. It's looking at what are the systems in place, and the systems that we play within, that create these results.
As an example, you might have a sales system, a client recruitment system, a client engagement system. Where are the improvements you can make in each of those systems to improve your results?
The other aspect of systems thinking is to look at 'what are the systems that the organisation belongs to? What are the economic system, the political system, the social system that you sit within that have an impact on you and your clients? Are there ways of influencing or working within those systems to produce better results?
That's a multilevel plan.
We also need to have multi-stakeholder plans.
This is not just about you and your clients. It's about your clients, your staff, your community, and your society. When you start to have multi-stakeholder plans, the richness and effectiveness of your strategy broadens and has a more far reaching consequences that are meaningful to you and everybody that you come across.
We can build a multi-dimensional plan.
What does that look like? We've talked mostly about strategy, in terms of starting with results, then measures, then looking for improvement initiatives. That's one aspect. Multi-dimensional strategic planning includes that. It also includes your corporate culture. How are you going to grow, evolve, and maintain that? It includes leadership. How are you going to expand and grow your leadership thinking as a leader? How are going to grow the leadership thinking within the organisation, so you have leaders growing leaders? The fourth element is contribution that links back to the purpose - what lasting difference and legacy will you make? How is that built into your strategic improvement methodology and what you're actually going to be focusing on for the year?
We can expand horizons.
When we're thinking about strategy, we want to have different horizons in mind. They get fuzzier the further out they go. There is the yearly horizon. Then there is the decade horizon, then the lifetime horizon. Then we have a generational horizon and multi-generational horizon. That is very big picture thinking that's really important for you to consider. This legacy work.
We include the ripple effect of impact.
Consider what is the impact: local, national, and global. Then your web impact, not like the internet web, but your customer's customers. That is the ripple effect. Do you have that component integrated into what you’re doing?
To summarise the six improvement areas for moving towards system thinker:
1. A purpose driven focus
2. Multi-level plans
3. Multi-stakeholder plans
4. Multi-dimensional plans.
5. Expanded time horizons.
6. Impact plan.
All of this is incorporated in strategy, culture, leadership, and contribution.
There you have it. That is my best tips on how to go from linear thinker to systems thinker and what mistakes to avoid when it's your strategic planning time.
How do you go about strategic planning? What tips can you share?
Zoë is on a mission to encourage big thinkers with big hearts to make a big difference. She is passionate about showing leaders how to improve their ability to connect, build unified teams and expand how they serve the world.
With over 30 years experience, she has published “Composure: How Centered Leaders Make the Biggest Impact” and “Moments: Leadership When It Matters Most.”