As you may be aware, Carpe Diem has worked with a number of organisations – including PMP Limited, Energex Retail and recently the Brisbane Diocese of the Anglican Church of Australia – in the area of strategic planning.
Our review of the literature relating to strategic planning, however, reveals that nearly 70% of strategic plans and strategies are never successfully implemented(!)
A number of myths exist to explain this amazing statistic. Most commonly, organisations talk of “lack of senior management support”, or the fact that “senior management was uninformed” as reasons for their inability to effectively implement strategic plans.
The real reasons behind unsuccessful strategic planning have, however, been uncovered via research. The following reasons have been uncovered, and we provide suggestions for reducing the likely impact:
Reason # 1 – unanticipated market changes
All strategic plans are prepared based upon a number of market related assumptions. Regrettably, markets don’t always behave as we anticipate(!)
Reducing the impact of unanticipated market changes
· obtain external, professional advice to understand which market conditions have the greatest influence on your strategy – better understanding leads to a quicker response time
· recognise what you do not know – identify the “known unknowns” and prepare contingency plans for multiple likely scenarios
· be prepared to implement your strategy differently – or indeed change your strategy – based on changes in the external environment
· remember that it is NOT the change in the external environment that erodes business performance – it is the failure to recognise and react to the unanticipated market change
Reason # 2 – effective competitor responses to strategy
Many strategic documents have aggressive plans to target competitors – what is often poorly thought through is how competitors will respond(!)
Reducing the impact of competitive response
· obtain market data prior to planning to understand competitors’ market positions, their relative competitive advantages and disadvantages, their historical behaviour and the general disposition of their respective management teams
· ensure your organisation has a solid competitive intelligence capability
Reason # 3 – insufficient resources
Organisations often fail to provide sufficient resources for BOTH the planning and the implementation phases.
Reducing the likelihood of applying insufficient resources
· recognise the importance of allocating sufficient time amongst a range of organisational stakeholders to undertake the planning process – don’t “fit it in” amongst other duties
· consider obtaining professional external resources to plan and facilitate internal sessions, and indeed the overall planning process
· include financial evaluation during the planning process to ensure that sufficient resources will be available to implement strategies
Reason # 4 – failures of buy in, understanding and/or communication
A “consultant sitting in a corner” should not do strategic planning, nor should it solely be the preserve of “senior management”. A strong link exists between organisational commitment and employees’ support of an organisation’s strategic plan. Good strategic management is a function of people actively considering the strategies as they make day to day decisions about the business.
Reducing the likelihood of failing to obtain buy in
· consider including middle and non managerial personnel as part of the planning process – customers can also provide fascinating insight(!)
· ensure that the people who need to implement the strategies demonstrate buy in and understanding: ultimately buy in leads to consistent execution
· remember that the communication and acceptance of the strategy is as critical as its development – formal communication and change management programs may be required
Reason # 5 – timeliness and distinctiveness
Fundamentally, good strategy should distinguish the company from others in ways that make a difference to customers.
As we emphasised to Microsoft and its business partners during a current national assignment – there is no long term benefit in positioning your organisation as being “better” than competitors. You must be “different”, and your “point of difference” must be something that the market values.
Reducing the likelihood of failing to be distinctive
· understand your organisation’s genuine strengths
· scan the marketplace to understand what market positions are unoccupied
· focus your organisation’s strategies on employing its strengths to capture those unoccupied strategic positions
Reason # 6 – lack of focus
Companies that try to be “all things to all people” lack distinctiveness and focus – resources are dissipated and priorities not articulated.
Reducing the likelihood of lack of focus
· employ a degree of simplicity in defining strategy
· equally important focus is to prioritise clearly in developing strategic
At Carpe Diem, we are hoping we can assist organisations to avoid these pitfalls via our well tested strategic planning methodologies - but by also providing an "external voice" to critique your existing planning processes.
To further assist, we have adopted from the literature a checklist for successful strategic implementation. Just click here - give us your thoughts on what we have written above - and we will gladly email it out to you.
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