July 2007

Dear Chris,

Welcome to the first issue of perspectives! Each month will focus on a particular strategy-related topic that I hope will be of interest and stimulate your thinking. Based around a short article, I’ll include further links, events and resources to help make it useful as well.

This month I’m writing about strategic planning, and how a different way of considering what it really involves can help your organisation to be better at it!

I’ve included you on the circulation list because I felt you might be interested in receiving perspectives (it will take about 5 minutes to read each month), or you might know others who would - but if not then please just click on the link at the end of the e-mail to unsubscribe.

As always I welcome your comments. Please feel free to forward this to colleagues – if an article stimulates discussion so much the better! If there are any topics you would like to see included in future issues, please let me know.

Best wishes

David Booth

I’ve always struggled with the term ‘strategic planning’.

It sounds very grand and important, but also analytical, dry and remote – the ‘traditional’ view of strategic planning is of an almost elitist activity done ‘for’ (and often ‘to’) the people in an organisation by a specialist corporate team or external consultants, resulting in long polished documents full of charts and projections.

Yet this seemed in marked contrast to what I was experiencing and learning as I became more involved in the strategic development of organisations. I began to realise just what was important to make a strategic planning process really effective, and to appreciate how powerful this can be for the organisation.

Part of the problem lies in the combination of the two words. As Henry Mintzberg and others have pointed out, the craft of developing strategy is very different to the skills required in a planning process. The name implies a structured, analytical exercise - and that does not do justice to the way in which people actually think and learn together in an organisation to work out how best to influence its future.

It’s hard, though, to think of a better term. I’ve mused on the subject (my paper What’s in a name? – the heart of strategic planning can be downloaded from the ixq website here. I often use the term ‘strategy journey’, which seems to me to convey the exploration and adventure involved - and it captures how an organisation thinks, decides, communicates and adapts as it works out where it wants to go and how it’s going to get there.

It also reflects the nature of how strategies and plans develop. In a continually changing environment it’s the ability of an organisation to adapt and evolve that is key: a strategic plan just crystallises the organisation’s thinking and intentions at a particular time. Its real value is as a platform, a guide and a stimulus to action and to shape how the organisation makes decisions and modifies its behaviours as the future unfolds.

This approach is developed further in the latest thinking about how strategy develops in organisations. The latest two issues of the leading international journal of strategic management, Long Range Planning (LRP) (still so titled for reasons of established name recognition) have been dedicated to the ideas of ‘strategising’ and ‘organising’ as the principal activities in which people in an organisation engage when making sense of what’s happening, what the organisation could become, and working out how to try to achieve this.

Considering these as distinct elements has several advantages. It recognises that there are different types of thinking and processes involved (and hence abilities required). Importantly, it reinforces that an organisation can be continually involved in each. Strategies often emerge and develop, and organisational priorities and resources change in the light of developments – they should not be confined to a defined ‘strategic planning’ project every 3 or so years! Strategising and organising are dynamic: the skill of leadership is to understand how best to stimulate and guide these processes, helping create an environment in the organisation to enable these to flourish at the appropriate time. The role of leadership is also to facilitate the discussions, debates and decisions that need to happen in strategising and organising.

Thinking in this way – about strategising, organising and leadership – helps embed strategic planning at the core of an organisation and engaging people at the heart of it. For me, this is a much healthier view - more dynamic, meaningful and realistic - than the old, dry stereotypical image of strategic planning, and an approach that can help organisations address their futures more successfully.

For further exploration….

Henry Mintzberg is one of the leading writers about how strategic planning has evolved – see for example ‘Strategy Safari’ by Mintzberg, Ahlstrand & Lampel (Prentice Hall 1998). For a lighter read, ‘Strategy Bites Back’ by the same authors (Prentice Hall 2005) is a stimulating (and very accessible!) collection of articles and stories about the art of strategy-making.

‘Tired of strategic planning’, an article by Eric D. Beinhocker and Sarah Kaplan in the McKinsey Quarterly in 2002 argues that to add value a formal strategic planning process needs to have the overarching goals of a) building “prepared minds”, making sure that decision makers have a solid understanding of the business, its strategy, and the assumptions behind that strategy, thereby enabling them to respond swiftly to challenges and opportunities as they occur; and b) increasing the innovativeness of a company’s strategies by challenging assumptions and opening up the organisation to new thinking.

There is a wonderful quote that supports my ‘strategy journeys’ analogy in ‘Leadership as the enabler of strategizing and organizing’ by Colville and Murphy in the December 2006 issue of Long Range Planning: “Strategic plans function a lot like maps in which the crucial factor is not the map (or strategy) but the fact that you have something that will get you started on a path to the future”. Articles from Long Range Planning can be downloaded (for a fee) from www.sciencedirect.com

My paper ‘Common pitfalls of strategic planning – and how to avoid them’ is available (free!) from the ixq website. Happy reading!

So, what do you think?

Are ‘strategising’, organising’ and ‘leadership’ more helpful ways of thinking about how organisations shape their futures than the traditional approach to ‘strategic planning’?

Let me know your views!