Strategic Planning in Uncertain Times
To say that 2020 was a challenging year would be stretching the art of understatement to its limits. It might also suggest that the challenges have been left behind with the new year celebrations which, just a few weeks into January 2021, we know is far from true.
When the world around us feels so chaotic and uncertain, it’s tempting to throw up our hands and declare that planning of any kind is futile. How can we plan for the year ahead in our businesses, communities and personal lives when so much is unknown? How can we create a strategy when the landscape and the rules seem to be changing by the hour? But turbulent times like these are precisely when we need a clear course to steer by and a clear set of objectives to hold on to.
Both Dwight D Eisenhower and Winston Churchill are credited with almost identical quotations about planning. Eisenhower said: “In preparing for battle … plans are useless, but planning is indispensable” while Churchill put it more plainly.
“Plans are of little importance,
but planning is essential.”
- Winston Churchill
In other words, we should certainly work on building our plans, put thought, time and energy into our strategy and objectives for the year ahead, but we shouldn’t get too attached to the plan itself. Keep on planning, keep measuring, keep reviewing and always be ready to rethink when needs must, and the world around us changes.
A good plan should be multi-layered and based firmly on fundamental principles, building through groups of focussed objectives and key results (OKRs) up to a clear set of specific actions and tactics.
These plans will certainly need to adapt and change over time, but the fundamental building blocks should rarely change while the more specific actions and tactics may need to be revised daily.
By creating a structured process for planning, measuring and adapting to change, we can put our organisations into the best possible position to react to whatever 2021 has in store.
A Multi-Layered Approach.
In this model, we see how a detailed, practical and flexible plan can be built up in layers from fundamental principles for the organisation as a whole right through to individual actions.
Purpose and Mission: Every organisation should be clear about why it exists, and this should be succinctly stated in your purpose. Your purpose is unlikely to change over the life of your organisation, although it may be re-stated or worded differently from time to time.
Your mission statement should set out how you, as an organisation, aim to fulfil your purpose. Again this will rarely change over time.
It’s useful to always start any planning session by remembering your purpose and mission; treat it as the bedrock on which everything else that follows will be built.
Strategy: This is your broad plan for what you want to achieve this year and perhaps over the next two to three years. Your strategy should reflect your mission and purpose but make them more concrete and specific.
Objectives: This is where flexibility and focus is introduced. This is also where the plan starts to break down into departmental or divisional plans. There should be only a small number of these quarterly objectives in each case, three being the recommended number, to allow for focus.
Objectives should be qualitative (i.e. not including numbers) such as “Increase Sales”, “Improve Customer Retention” or “Add feature x to the Product”. Objectives should also be owned by specific, named, senior individuals who have the responsibility and the authority to drive them to completion.
Key Results: For every objective, there must be a way of measuring progress, ideally between three and five key results. The question to ask when deciding on these results is “What does success look like?” These should be very specific, challenging but achievable, and, of course, things that can be measured. It may also help to think about different degrees of success here, for example: “Adding 20 new customers this quarter is good, 30 would be excellent, anything less than 15 would be a problem”.
Think carefully about what key results you pick based on the outcomes that you are trying to encourage. For example, if your objective is to increase sales then a measure of “add 30 new customers” may seem appropriate, but if the sales team can add 30 low-value customers fairly easily, that might not lead to the results you want. A better measure might be: “Ad
d £20,000 in new deals”. If one or two large, new customers could provide that revenue the number of customers may not be significant.
Choose results based on things like profitability, quality of service or long-term outcomes rather than income, transactions or short-term gains.
Tactics and Actions: Having established your quarterly objectives, you can now focus on the weekly and daily actions needed to achieve them. This is where individuals and teams get their to-do lists but also where they are encouraged to react to events and results, come up with new ideas and try out new approaches. This must be done while regularly monitoring the key results and keeping the objectives clearly in mind.
Reviewing and Managing Your Plans
“Bad companies are destroyed by crisis, Good companies survive them,
Great companies are improved by them.”
- Andy Grove ‘The Father of OKRs’
As we have seen, planning needs to be an ongoing process or system, not a one-off exercise and it requires a layered approach with each layer being owned, managed and regularly reviewed.
An example of how you might achieve this is shown in the cycle above. With the Purpose, Mission and long-term Strategy defined, the organisation can embark on a quarterly cycle of setting objectives, meeting to review plans and progress, reviewing the key results, learning lessons and then setting new objectives for the next period.
Managing this process well for even a medium-sized organisation will require a dedicated software tool. Ideally, you want to use a system like Decision Time to create your objectives, link them to key results, report on progress and prompt users to complete their actions, fill in actual measures, etc.
A good system will provide a graphical dashboard, options for tagging and categorising your objectives, controls over who can own and edit the data and automatic email reminders to prompt action.
If you would like to talk to us about your own approach to Goals, Planning, Objectives and Key Results or to learn how our software can help with this process please get in touch.
