strategic planning

Strategic planning is knowing what your business is not

You never would guide your team to implement a strategy that not even you understand, right? Actually, maybe you would. According to a Donald Sull’s research, nearly half of executives see no connection between the strategies of their companies. In addition, two out of three managers say they don’t understand the strategic direction they are following. If you face that problem, see now a new way to conduct strategic planning, with more chances of success, and be able to let everyone aware of the direction to follow.

Compare and Contrast

As a leader, you should overcome the problem of cluelessness about the company’s future. The solution, you wouldn’t expect, is to use a technique that many teachers use and educational researchers recommend to help adults. The technique is: Compare and Contrast.
Say you’re trying to teach a child what a rectangle is. It would be a mistake to only show a red rectangle and identify it as a rectangle. Why? Because the child can assume that all the rectangles should be red or that the color red is related to the rectangular shape. So you need to make finer distinctions.
A better approach is to teach the child that a yellow book and a white window are also rectangles (Compare), whereas a red ball and a red tin are not rectangles (Contrast). The expected result is that the child will be able to generalize that understanding to new situations. She will easily identify a TV as a rectangle, but not a tire – even if you’ve never said anything about TVs or tires.
It seems a mere exercise in learning, but know that it is precisely the Compare and Contrast technique that professionals disregard when doing the strategic planning. See how to apply it in a practical way in your daily life:

The waiting list

What we see is a requirement for leaders to know clearly what are the strategic objectives of the company, but rarely we see a requirement for leaders to be sure what is not a goal. If this happens to you, Nick Tasler has a solution: set a waiting list for some strategic objectives.
Let’s assume that during the strategic planning for this quarter, you come to a set of priorities that can boost the growth of your company, such as launching new products, improving the quality of existing products, increasing employee involvement in decision making and cost reduction.
It turns out that not everything that is important can be a priority. So, before dividing tasks and put your hands dirty, discuss with the leaders of the teams which goals should go to the waiting list. Despite all have the potential to expand the company’s profitability this year, the ideal is to allocate at least half of the goals for the waiting list, where they can stay for up to six months.

The case of Starbucks

The waiting list is not just to make your project list thinner. When putting side by side the priorities, the team practices the comparative learning. For example, if it is determined that the release of the next generation of products will go to the waiting list, while improving the quality of existing products is on the short-term priority list, you all just agree that, despite the company values innovation, in this moment the strategy is make better what already exists.
It was exactly what Howard Schultz did in 2008 when he decided to withdraw the highly profitable sandwiches from the Starbucks shelves for nine months. In making that decision, he show to the board and baristas the company strategy of “reassert our authority on coffee”. Then, Starbucks doubled its research to develop new coffee creations. Schultz showed managers that “because it makes money” was no justification to divert the focus on coffee.
Perhaps, for your team, strategic planning is synonymous with a smorgasbord of projects, and that’s why neither managers nor the board know what the true direction of the company is. Setting a waiting list is the way out of this impasse, precisely because it calls on all leaders to compare and contrast the priorities. A common theme will emerge, and you will conclude that, focusing on execution, you will have a safer and more durable reign – the largest of your priorities, by the way.

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