The Whiteboard: 5 questions to ask now about your firm's strategic plan
It's already the third quarter of the year; the fourth quarter will be here before we know it. If your business is exercising good strategic management, there are important things you should be doing now.
In the fourth quarter, businesses operating on a calendar year will start putting together expense and capital budgets for next year. These budgets should be aligned with and supportive of the company’s strategic plan. That is an important element of good strategic management.
It’s time now to ask key questions about the strategic plan, so they can be answered and necessary actions can be taken before the budgeting process begins.
Do you have a current strategic plan? If your strategic management processes are robust, then the answer will be yes, because the plan is constantly being refreshed. Too often the answer to that question is no. If that is the case, it’s not too late to update your plan or create a new one.
Don’t discount the importance of a strategic plan. Most of us wouldn’t begin a cross-country driving trip without looking at a map and planning an itinerary. Without a strategic plan, your business is plunging blindly into the future. If you just took off on a driving trip, you would likely at least have a destination in mind. Without a strategic plan you don’t even have that.
Are the goals defined in your strategic plan still valid? Goals can change for any number of reasons. Good strategic management includes regular review of goals, especially at this time of year.
If the business has achieved one of its strategic goals ahead of schedule, it is important to get a new goal in place. Perhaps the bar should be set higher or possibly a new goal with a different strategy is needed. Celebrating achievement of goals is important, but at this time of year you can’t bask in the glory too long. It’s time to define the next step.
It’s also possible that a goal that seemed perfect when the plan was created is no longer meaningful. Conditions change. New competitors, economic forces, government regulations can all change your strategic outlook. If that happens, the business will need new goals and new strategies, and a different budget.
Is the implementation of your strategic action plans on schedule? It does no good to have great-looking action plans with activities that are not getting
done. If that is the case, then some soul searching is in order for top management.
Good strategic management practices keep progress on the action plans visible to top management. If the plans aren’t regularly reviewed, it is easy for other “urgent” priorities to eat up your resources. Failure to properly staff strategic action plans or to provide adequate project budgets can also doom plans to failure. No better time than the present to ensure the plans are properly resourced and budgeted in the upcoming year.
Are your strategies working? This is an important question that should be asked by top management regularly, certainly before next year’s budgeting is started. It’s no crime to make a mistake when choosing among strategic alternatives. But it is a crime when management fails to recognize it in a timely manner. When a strategy isn’t working, it is critical to take action, first to understand why and second to formulate Plan B, which could be anything from tweaking the strategy to scrapping and replacing it. Far too many resources are wasted on failing strategic initiatives that should be recognized and killed.
Time marches on. Take the initiative now to ensure your budget supports your strategy.
Richard Randall is founder and president of management-consulting firm New Level Advisors in Springettsbury Township, York County. Email him at email@example.com.