strategy + ai
Why Strategic Planning Fails?
“The essence of strategy is choosing what not to do.” Michael Porter
Most adhere to the widespread misconception that strategic planning's sole purpose is to establish annual budgets and outline five-year forecasts. Although such methods may prove effective in stable and relatively predictable industry environments, the reality is that stability is becoming increasingly rare and elusive in the business and education worlds.
Our team assists clients not only in crafting successful corporate and divisional strategies but also in the conception, development, and implementation of superior strategic planning systems. These systems are designed to generate acute insights and foster an environment conducive to achieving tangible outcomes and driving robust results. We work closely with our clients and implement one of following three models, based on the client business model:
1. OKR
The Objective and Key Results (OKRs) is a strategic planning and goal-setting model that translates the organizational goals into objectives and tracking their key outcomes. The model is based on identifying three to five goals that can be achieved and three to five results that should result from each of them. The mode is used by organizations like Google, Intel, and LinkedIn to help set priorities, drive focus, and achieve strategic objectives.
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2. Balanced Scorecard
The Balanced Scorecard helps organizations translate their mission and strategy into a set of balanced performance indicators. Developed by Robert Kaplan and David Norton in the early 1990s, the Balanced Scorecard seeks to provide a more comprehensive view of an organization's performance by considering the financial, customer, internal process, and learning and growth profiles of the organization.
CONTACT US3. KPIs
Key Performance Indicators (KPIs) based strategic planning is an approach that involves the use of key performance indicators to set, measure, and track the performance of an organization in achieving its strategic objectives. KPIs are quantifiable metrics that reflect the critical success factors of an organization. In the context of strategic planning, KPIs are aligned with the strategic goals and provide a means to assess progress and success.
Why Strategic Planning Fails?
Strategic planning could fail for many reasons here are the most common reasons:
- Using the unsuitable model. Using the strategic planning model that does not match the organization's mission could lead to failure of the plan and the achievement of organizational effectiveness.
- Goals
are not clear. Many strategic plans are set forth to accomplish the
mission and vison, but the vision is broad, and goals are not clear for
the employee to know what actions are needed to accomplish the goals.
- Too
ambitious. Some strategic plans are developed with too many goals that
makes it difficult to accomplish.
- Static.
Many strategic plans are developed considering the environment related to
the business. But in reality, the environment changes and the assumptions turn
out to be wrong. Strategic plans must be dynamic and adapt to changes in
the business environment.
- Lack
of accountability. A successful strategic plan is one that ensures
there are consequences for not meeting the plan objectives.
Our Approach
We adopt an effective approach that emulates four strategic planning best practices and deliver thorough and robust strategies that exhibit four vital characteristics that are crucial to their effectiveness and success:
- Explore strategy at multiple time horizons. Addressing the long-term, medium-term, and short-term perspectives individually is essential to crafting a holistic strategy. Each timeframe has its unique set of required goals, stakeholders, and operational cadences—and overlooking any of these aspects is not advisable. It's crucial to give dedicated attention to the specific needs and adjustment mechanisms that each horizon demands to ensure a comprehensive strategic outlook.
- Reinvent and stimulate the strategic dialogue regularly. It’s very easy for a strategic planning process to become less effective over time. Excessive repetition without innovation can render the process ineffective. To combat this, top-tier strategists continually refresh the planning exercise by introducing innovative questions and reconsidering the framework of the strategy development process, especially when such processes become outdated in the face of the swiftly changing strategic landscape. This involves a dynamic and reflective approach that keeps the strategic thinking relevant and impactful.
- Engage the broad organization and beyond. To foster a truly competitive and inclusive strategy, it is imperative to extend the conversation beyond the central strategy team. This means actively involving business unit leaders, board members, agile response teams, customers, and even suppliers. This broad engagement helps prevent the tunnel vision that can result from a homogenous group, enhances the capacity for immediate and effective response to changes, and significantly contributes to a more seamless and effective strategy implementation process
makes it difficult to accomplish.
- Invest in execution and monitoring. Beyond articulating the strategy clearly, it is also critical to adopt an action-focused approach backed by strategic capital allocation, appropriate organizational structures, and performance metrics that align with the strategy’s goals. Strategic initiatives that are identified as priorities must not only be insulated from the regular, day-to-day distractions but also need to be constantly monitored and reviewed using a comprehensive performance dashboard that allows stakeholders to observe progress and adjust tactics accordingly.