Related Expertise: One good practice is to include directors in the questioning phase and in specific conversations along the “W” process described above. It doesn’t have to be that way. Long gone are the days when the Human Resources department focused solely on recruiting employees. Such an approach breaks the compromise between process efficiency and fresh thinking. The same inputs lead to similar conclusions. Executives at most companies criticize it as overly bureaucratic, insufficiently insightful, and ill suited for today’s rapidly changing markets. Joint Ventures, April 14, 2016  © Boston Consulting Group 2020. Leveraging a diverse group of stakeholders improves an organization’s strategic “peripheral vision.” The best strategists are adept at spotting both opportunities and risks early—which provides a valuable head start over rivals. After a constructive dialogue (shown at the middle of the W in the exhibit), the leadership team selects from among the options and sends management back to develop detailed plans, which are then discussed and approved in a second meeting. Some companies have attempted to change the process every year, designing different exercises for managers. Some even argue that strategic planning is a relic that should be … In the second year, the process is less painful, because most analyses can simply be adjustments of last year’s analysis—but, typically, it is also much less use-ful. Strategy newsletter; 4 4… Will the company’s traditional sources of advantage remain strong or be compromised? Four Best Practices in Strategic Planning Tag(s): Strategic Dialogue , Strategic Planning , Strategy Development , Strategy Execution Understanding the Role of the Chief Strategy Officer Access a free summary of Four Best Practices for Strategic Planning, by Nicolas Kachaner et al. The best practices outlined in this report may need adjusting in certain special situations. 1 1. Four Best Practices for Strategic Planning Nicolas Kachaner, Kermit King & Sam Stewart The Boston Consulting Group (BCG) April 2016. A good strategic plan can improve student outcomes, keep great teachers and enhance the reputation of district leadership. Next, you need to work out a timeline in which you can complete your strategic plan and move through the process. Strategic Planning, In these cases, it is essential to have a strong executive sponsor and clear funding sources. Acknowledgements. The application of strategic planning in business is a result of difficult managerial decisions that comprise good and less desirable courses of action. Strategy execution is drawing a lot of attention these days, but that in no way means companies have abandoned their time-tested strategic planning processes. With strategic planning—unlike sports or music—repetitive practice doesn’t make perfect. Leverage the Organization’s Purpose. The strategy department typically plays the role of process manager, providing support and keeping the team on course. Successful realization of the strategy would be tracked by upward movement on the chart over time. Phone Email Chat Help. Generally, it is important to include key family shareholders in the planning process. Conglomerates. Leadership memorialized the strategy with a simple chart that showed share of wallet on the y-axis and wallet size on the x-axis. One common order is product plans (with input from key countries), geography, and then function. Best Practices Reports in the community association industry. The process continues downward. Clear and Engaging Communication to Foster Alignment. Another powerful way to encourage the organization to embrace the new strategy is to identify quantitative metrics and goals that can measure progress. Allow time for big picture, strategic thinking. Engaging stakeholders early also increases buy-in and smooths implementation. Matrix Organizations. Of course, the success of this approach depends heavily on the quality of the questions. It’s that most companies lack an effective strategic-planning process. Most businesses practice strategic planning annually, but the best ones do it more frequently, such as twice a year or even quarterly. Invest in Execution and Monitoring. At each stage, the strategy group reviews the memos for clarity and consistency with the overall strategy. A healthcare organization's strategic plan is designed to identify the necessary actions needed to reach the objectives of the organization. Four Best Practices for Strategic Planning, Die Another Day: What Leaders Can Do About the Shrinking Life Expectancy of Corporations. Each needs to build a multiyear strategy, but how can the company ensure that the dots connect in the end? Best Practice • April 5, 2018 HR strategy examples – What makes a successful HR strategy? Having a great strategic-planning process is … Boston Consulting Group is an Equal Opportunity Employer. Executives at most companies criticize it as overly bureaucratic, insufficiently insightful, and ill suited for today’s rapidly changing markets. (For a glimpse of scenarios that require special consideration, see “Three Special Cases.”). Four Best Practices for Leveraging IT Services for Strategic Workforce Planning Published: 13 August 2015 ID: G00278348 Analyst(s): Suzanne Adnams, Mark Coleman Summary Digital business requires that workforce planning be done within a business context rather than a technology context. Multibusiness companies need, of course, to go through a thoughtful strategy development process for each business. (See the left side of Exhibit 2.) A critical element in effective strategic … A strategic planning process identifies strategies that will best enable a nonprofit to advance its mission. The right questions should be neither too broad (“How do we save the world?”) nor too narrow (“How do we price the next new product?”). It doesn’t have to be that way. Publication year: 2016 Strategic planning is one of the least-loved organizational processes. Particularly for strategies that involve adjacent moves or new business models, initiatives may not have a natural organizational home. If you refresh your strategic plan every year, you might be able to work through this process in 4 … This approach not only helps managers get their heads around the new direction (the act of creating a written synthesis forces concentration and drives alignment) but also pinpoints areas of the organization where the strategy is not well understood—before that misalignment has a chance to affect performance. And how can the business strategy best be harmonized with them? This thought process needs to cover issues like the balance of the portfolio—and the synergies across the group, whether soft synergies such as training and talent sharing or hard ones like cross-selling and shared services. Progress reviews and “pressure tests” should have a regular place in the executive committee’s monthly always-on strategic dialogues. explores best practices of workforce planning across a variety of Federal, state, and private industry organizations known for successful workforce planning. In a fast-moving tech sector, five years could be too long even for the long term. By involving people from different backgrounds, generations, and geographies, an organization is more likely to surface alternative ideas and perspectives. Although there is no one-size-fits-all approach to strategic planning, we have found that the companies that get the most benefit from their strategic-planning activities have four things in common: It is important to think about strategy at different time horizons. Question-driven strategic dialogue is inherently an iterative process—even when it occurs on an annual basis. Although the diagnosis is largely right, the prescription is wrong. This allows companies to explore weak and emerging signals of opportunity and risk—such as subtle changes in customer or competitive behavior—in core markets as well as in peripheral or adjacent markets. Particularly in today’s turbulent competitive environments, a well-chosen extended strategy team can be a powerful early-warning system. By Fouad Bendris. In the first year, it is a big, painful effort. It is important that initiative teams and the organization overall understand that these initiatives are priorities for the executive committee. All rights reserved. 6 Four Best Practices for Strategic Planning dialogue. Many companies have at least a three-dimensional matrix: for example, brands or product lines, geographies, and functions. Heres what we know about strategic planning in education including a brief histo… Some companies even engage outsiders, among them customers and suppliers, in the process. organisations with portfolio diversification. But they also need to orchestrate a complementary thought process about the value each business adds to the overall corporation. And incentives for key players should be tied to these metrics and goals. Store Donor Data in Your CRM. An all-too-familiar story: A company spends productive time exploring exciting strategic options and making clear choices. (See “Die Another Day: What Leaders Can Do About the Shrinking Life Expectancy of Corporations,” BCG article, December 2015.) By focusing a standard process on new questions, the strategic dialogue will remain rich, because participants will have new analyses to consider and fundamentally different ideas to discuss. He or she interviews the executive team and hears about the pain points in the process: too much work, not enough big ideas; too financially oriented, too inward looking. Some sessions may focus on a deep dive into a critical initiative, for example, whereas others may concentrate on exploring an emerging threat, a new competitor, or a disruptive business model. The cascading memo can help, but it’s often helpful to “linearize the matrix”—that is, to start with one dimension and use its output as input for the next dimension. They constantly reinvent and stimulate the strategic dialogue. When going broad, the strategy team still has a critical role as orchestrator. But it is also quite useful because the new analyses uncover new ideas and stimulate valuable dialogue. Strategic planning is one of the least-loved organizational processes. Sometimes, organizational independence is necessary as well. Contents. K.ePšLßҎlR9¢Ç¥Eµª®tUoëÑCøI/ Ê—Knœ {éæÉSD0- Ÿ¡ûºf–Éi΢2¢€ðÊaE3tF&ÜM7. A more sustainable solution is to follow the same process year to year but to refresh it with different questions each year. As noted management consultant and writer Peter Drucker once said, “The most common source of mistakes in management decisions is the emphasis on finding the right answer rather than the right question.”, Great strategists—and great business leaders—have to learn the “art of questioning.”. Looking forward, the company’s executives could see that an aging population and the fitness trend would provide strong tailwinds for a change in course toward the health care sector, while continuing commoditization would leave the traditional consumer electronics business at best becalmed. In this 60 minute training, we will share best practices you can use to create a #StrategicPlan that your whole team can get behind. Nothing affects a school district more than its ability to create and execute a strategic plan. Beyond simple slogans, the classic cascading-memo exercise can also be quite powerful. It starts with the CEO sending to direct reports a one-page memo that summarizes the strategy. Reasonable is the key word here, as that depends on your organization’s maturity level with regard to strategic planning. Create department champions to promote engagement and buy-in; 2 2. And the life span of the average company has halved since 1970. Much of the frustration expressed about strategic-planning processes arises when companies try to address the long, medium, and short terms through a single, inflexible process. All qualified applicants will receive consideration for employment without regard to race, color, age, religion, sex, sexual orientation, gender identity / expression, national origin, protected veteran status, or any other characteristic protected under federal, state or local law, where applicable, and those with criminal histories will be considered in a manner consistent with applicable state and local laws. When the company’s dominant core model is potentially dissonant or even competitive with the new opportunity, the best way to drive a successful result is to insulate the new effort from the core, to give it time and space to find its footing. High-Profile Strategic Initiatives to Build Traction. Nonexecutive directors—who are charged with bringing an outside perspective to evaluating and approving the company’s strategy—can play a powerful role too. Rather, they should help managers stretch their thinking beyond the current boundaries of their day-to-day activities. Mission Statement. One year—to use a famous dot-com-era example from General Electric—it’s “” The next, it’s a search for underleveraged assets. Some even argue that strategic planning is a relic that should be relegated to the past and that organizations seeking to prosper in turbulent times should instead invest in market intelligence and agility. What are the goals and long-term aspirations of the family? As a general rule, organizations that engage a broad group of internal and external stakeholders in their strategy development efforts yield better results than organizations that leave strategy in the hands of a small, central team. Tag(s): Strategy Development, Strategic Planning, Strategy Execution, Strategic Dialogue. We tend to try to squeeze strategic … Here are four key agenda items that work in any Strategy Review. They called the strategy “go north.” The phrase became an important element of the company’s internal language—almost a rallying cry. Strategic planning is one of the least-loved organizational processes. Once a small entrepreneurial project nurtured within Nestlé, Nespresso became a worldwide success—but only after it was set up as an independent unit. It’s important to limit the number of questions to two or three per business unit or department. Failure in strategic planning can be disastrous. Define goals and aspirations. The memo charges them to write their own version for their team that expresses the strategy and what it means for their slice of the organization. 1 March 2016. A Strategy Dashboard to Highlight Success Metrics.