What it Actually Takes to Automate Strategy
Let’s explore some typical challenges that organizations face when implementing strategic planning software; we’ll talk about timelines, risks, and cultural change needed.
Starting Point — Strategies in Spreadsheets
Most organizations already have their strategy automated in some way. Typically, it’s an Excel spreadsheet with weighted KPIs and goals, and sometimes, there is also a strategy map created in the presentation software.
With increasing scale and complexity, such spreadsheets become unsustainable.
A symptom we see among new users is a spaghetti-style strategy spreadsheet.
- The efforts to maintain such spreadsheets are growing exponentially,
while
- The value produced for the internal stakeholders is decreasing due to less frequent updates and decreasing veracity of the information.
In spite of the disbalance in the efforts/value, the organization’s inertia keeps such spreadsheets alive for a long time until the complexity, as perceived by the senior strategists, reaches critical point and the organization starts looking for some specialized strategic planning tools.
Cultural Shift is Needed
The first impulse of the management team is to migrate their strategy spreadsheets into some specialized software to get a better interface and nice dashboards out of the box. In this case, the organization is at risk of replicating the same unsustainable strategy scorecard by dressing it up with some automation features.
A better idea is to:
- Revise the current approach to strategic planning,
- Understand factors that made strategy unsustainable, and
- Plan for a cultural shift in the context of strategic planning.
Here are some questions to ask:
- How does your team discuss new challenges?
- How are the vague and ambiguous goals converted into specific objectives quantified by KPIs (see the decomposition article)?
- How are the action plans defined?
- If there is a risk assessment?
- How are the sub-strategies and functional scorecards combined into a comprehensive strategy?
We shared our vision of a typical strategic planning process in this implementation guide.
Three Stages of Strategy Planning Automation
Here are three steps that we typically see when organizations start adopting a new strategic planning tool.
Stage 1. Testing Waters
Key questions:
- Does the software feel good?
- What approach to strategic planning does it support?
- What’s the expected budget?
Timeline: 1 week
In the early stages, the challenge of implementing strategic planning software is about finding the match between the strategy planning philosophy supported by the software and the mindset/expectations of the managerial team.
At this stage, an advocate of strategic planning in the organization tries the software to find out how close it is to their ideal solution.
It is a good time to arrange a live demo to get an initial impression of the tool and the team behind it.
Some organizations follow a formal procurement procedure with an official call for proposals. This is fine for the initial screening of the software candidates, but ultimately, most of the tools will have all the boxes checked. It’s more important to give some tools a try and find out how they feel in practice.
Stage 2. Building Prototypes, Initial Implementation
Once the initial “testing waters” stage has passed, we see organizations move to the stage of building some prototype of the strategy scorecard. Some remain on the free plan, which is perfectly fine for smaller strategy scorecards, while some prefer to buy a subscription to start building relationships with the vendor.
Key questions:
- How exactly does the tool deliver the promises from marketing materials?
- How does it relate to our challenges?
- How to get started with the tool and unlock its potential?
- How to adapt our strategic planning process?
- How to engage others in using it?
Timeline: 2–3 months.
During the prototyping stage, the strategy team is trying to match their understanding of the strategic planning with the logic of the software.
At this stage, the adaption is on the level of the terminology, workflows, reports, user model, data access model, etc.
Managing the Legacy of Excel Scorecards
As we discussed above, a starting point for many strategic planning efforts are the scorecards created in spreadsheets with all its advantages and disadvantages.
Finding the way to migrate data from a spreadsheet to a specialized software is critical for two reasons:
- Existing engagement from the team. The strategy spreadsheet you are using now is what your team knows and understands. It might be badly designed, hard to maintain, but your team is accustomed to its structure and terminology.
- Historical data. Most likely, that spreadsheet contains some historical data. Migrating it to the specialized software would give a valuable context for the new goals and strategies.
A commonsense approach to the spreadsheets with goals and KPIs would be:
- Find the things that were right in Excel and import them into the specialized software.
- Find bad practices and make sure they remain in the spreadsheet.
For example, in the Excel spreadsheet of one of our customers, we saw the division of the KPIs into leading and lagging indicators. Validating the efforts and results separately is one of the best practices.
The problem was that the leading and lagging indicators were weighted all together. For example, for one of the goals, the impact of its leading indicators was 20%, and the impact of lagging indicators was 80%. This practice had no reasonable business explanation and was replaced with a more common relevant weight model, where the performance for the leading and lagging indicators is calculated separately.
Stage 3. Scaling — Use Strategy Sandbox
On stage 2, we typically see just a few key members of the strategy team. On stage 3, their challenge is to get other stakeholders onboard.
Key questions:
- How can we involve other members of the team in strategy design and execution?
- How can we connect strategy and functional scorecards into comprehensive strategy?
Timeline: 6–12 months.
In our implementation guide, we defined three types of stakeholders of strategic planning:
- Senior leadership team
- Strategy team
- Operational team
On the level of automation, the challenges vary according to the stakeholder:
- Senior leadership team will be interested in high-level monitoring via regular reports with dashboards;
- Strategy team will use the software more actively for regular strategy meetings, preparing for known unknowns via scenario planning, linking functional and strategy scorecards;
- Operational team will contribute to the overall strategy execution efforts via direct performance reporting.
I was writing about the strategy sandbox, a safe place where any member of the team can experiment with their small sub-strategies.
As a result, the strategy sandbox is one of the keystones of the successful scaling of strategic planning. With some onboarding training and having some templates, key members of other teams start getting a sense of the practical strategic planning.
Fast Lane: Implementation by Vendor
Can we pass the prototyping and scaling stage faster?
The direct contact with the vendor helps. It can be an online training session or onsite visit of the vendor for larger implementations.
It looks like a win-win:
- Vendor is getting an engaged client
- The client has everything up and running in weeks, not months
The problem here is that vendors don’t have enough time to make the cultural shift that we discussed above…
The tool will be working fine, but employees of the organization won’t use most of its potential.
The solution is to make sure that key members of your strategy team are those who get their hands on the software first (better with vendor’s help) and involve the rest of the team later.
Fast Lane: Self-Learning Mechanics
One of the challenges we discussed in our implementation guide was the increasing complexity of the business environment. How does it affect software automation?
As potential users, we want software that is plug-and-play and guides us throughout the process.
For example, one of the self-learning mechanics in BSC Designer is the quality score. The software analyzes a strategy scorecard automatically and displays the quality indicator; when the user clicks on it, the tool shows some improvement recommendations.
Our help is still needed for larger implementations, but with all other training mechanics in place (like video tutorials), we significantly decrease the need for live training sessions.
Summary
Unsustainable strategy spreadsheets are a typical factor that push organizations toward the automation of strategic planning with specialized software.
A typical implementation on scale takes around 6–12 months.
The main challenge is changing the strategic planning culture of the organization.
The rest of the time budget is spent on:
- Unlocking the functions of the tool,
- Migrating legacy data,
- Training staff,
- Scaling across the organization.
Organization can speed up the implementation by:
- Doing training sessions with software vendor
- Using self-learning mechanics built into the software
The final goal of the implementation is to make strategy everyone’s job:
One of the success factors for achieving this goal is having a strategy sandbox where all members of the strategy and operation team can contribute with their ideas.
