business strategy

How are strategic plans formulated: Cooking a Good Meal

If strategy is as important as we said it was last month, then clearly there must be some complex and convoluted way to write one, right? Wrong! The process is amazingly simple. But to adapt a quote from Clausewitz, we’ll say that “the simplest thing is difficult.”

You have to think of writing your strategy like making a tasty and healthy meal. You might disagree, but making a good meal is pretty simple, too. Yet it sometimes feels so complicated and difficult, and that’s because you need good tools, good ingredients, and time.

Tools: The tools you use are important; facilitators, collaborative spaces, whiteboards and easel paper are like the pots, pans, and knives. If you’ve got dull knives in the form of poor brainstorming tools, your process will take longer and frustrate you. If you’ve got clean and appropriately oiled pots and pans, like a facilitator who keeps people on task and maintains the clarity of thought needed, ingredients mix and cook well. Good tools make the foundation for a good meal—and good strategy.

Ingredients: But while tools are necessary, it’s the ingredients that really make a meal healthy and taste great; people and ideas are the ingredients to the strategic planning process. Just as you would never use rotten vegetables or spoiled meat, participants in strategic planning can’t bring negative energy to the table. You also want to use the freshest material you can get; you want the latest information and participants who have the intellectual nimbleness—the freshness—to understand that information. But the material can’t be so fresh that it’s unripened; you want experienced and wise participants who are comfortable with smart assumptions and taking risks. The people and ideas that are the ingredients of strategic planning are absolutely critical.

Time: And just like in cooking it takes time to make things right—undercooked ingredients can range from causing minor stomach problems to serious illness, strategic planning takes time. Ideas have to simmer; people need to mix. Most important, the participants in strategic planning need to dedicate time to do this. You can’t devise strategy while dealing with the crises in email or a zillion other distractions.

Once you’ve got the tools, ingredients, and time in place, then the process to get the strategy is not so different from following this recipe:

  1. Understand yourself: what are your strengths, your weaknesses?
  2. Understand your environment: what opportunities and threats are out there?
  3. Understand others: who are your stakeholders, and what do they care about?
  4. Agree on purpose: why do you do what you do? What’s your mission, and how do you envision your community looking down the road?
  5. Design value: given yourself, your environment, others, and your purpose—your why—what value can you bring that your stakeholders will care about?

The process is simple, but the simplest thing is difficult. Many people screw up the simplicity and lose the focus and clarity of thought needed to develop a good strategy, because they want to feel comfortable. They want to quantify everything. They want to study things further. They want to constrain business to what already exists or costs that can be measured. Strategic planning can be quite uncomfortable. We’ll end with our last reference to the cooking analogy though: if you can’t stand the heat, get out of the kitchen.

Steve Jobs said, “Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But it’s worth it in the end because once you get there, you can move mountains.” Bon appetite!


Why is "strategy" important?

If you’re familiar with the term “strategic planning,” you may associate it with lofty goal making, lots of time spent in frustrating conversations, and money spent on glossy documents that gather dust; if not, it may just sound like an abstract exercise meant for the brainy eggheads in your company or organization. Truth be told, it’s none of the above if done right, and strategic planning may be the very process that helps keep your doors open while your peers or competitors find themselves in varying stages of irrelevance.

Good strategic planning results in an imagined story of your future value to others. And while it isn’t hard to write a good story, it takes a few commitments to let your imagination run. You have to make deliberate assumptions to simplify the future. You have to tolerate risk to achieve something big. And you have to trust your gut and jump. A participant in a recent strategic planning session I facilitated said it well: “You have to place the hard bets, and you have to be willing to ante up.”

Strategic planning writes a story, and next month, I’ll want to discuss with you the process of story writing and get your thoughts about those commitments above. In future months, I’ll also want to dialogue with you on the leadership, followership, and management of change to turn that written story into real life. But before digging into either, I think it’s important to recognize why having a strategy–a story–is so important.

Having worked with organizations of varying missions and at different stages of growth, I’ve encountered some common problems:

  1. The day-to-day tasks of employees don’t align with business goals or “the-way-it’s-done” putters along inefficiently, lowering morale and motivation. Time–and therefore salary or payroll costs–is spent on miscellany that does not contribute to the core business, and this wasted time and money perpetuates itself.
  2. There are a lot of good–and bad–ideas on how to make things better, but there’s either no way to share and explore them or no ability for leaders to be secure in their decisions, including resource allocation, on those ideas.
  3. Work moves along everyday with no real challengers (“this is the way we’ve always done it”), but the organization gets caught off guard when someone leaves for a better opportunity, a competitor swoops in and grabs market share, or a new product makes yours irrelevant.

A strategy–a story–is important because it unifies everyone behind what your business does and prevents these common problems from occurring. It motivates your employees to bring their creativity to bear, because they know why they are doing what they do. It gives your leaders an ability to decide what to do, as the story talks about how you bring value to others. It prevents strategic surprise, because the story recognizes many of the villains that will take you off track.

Your strategy is important, because it’s how you talk about your future. But when you forget your story, someone else’s story becomes what’s told.