To improve performance in any endeavour…like growing a business, strengthening a team or even getting fitter…step #1 is to engage in high-powered strategic thinking and planning. Why? Strategic thinking and planning is the starting point for success in all areas of your life.
And here’s something else that’s really important. Get better at strategic planning and your performance will improve even further. Yes, it’s true. Better strategic planning equals better performance.
Today you will get an introductory lesson on how to become a master strategist. More to the point, you will learn the essence of what strategic planning is all about – the what, the why and the how.
So let’s get into it.
If you type “strategic planning” into Google, it will spew out more than 50 million search results. So it’s clear that strategic planning is a highly popular topic and search term.
What isn’t so clear is the definition of strategic planning, of which there are many.
Most of the definitions I’ve come across are very complex and targeted it seems for corporate and academic audiences. For instance, one such definition from the Balanced Scorecard website reads as follows:
Strategic planning is an organizational management activity that is used to set priorities, focus energy and resources, strengthen operations, ensure that employees and other stakeholders are working toward common goals, establish agreement around intended outcomes/results, and assess and adjust the organization’s direction in response to a changing environment. It is a disciplined effort that produces fundamental decisions and actions that shape and guide what an organization is, who it serves, what it does, and why it does it, with a focus on the future. Effective strategic planning articulates not only where an organization is going and the actions needed to make progress, but also how it will know if it is successful. (https://balancedscorecard.org/Resources/Strategic-Planning-Basics)
Bit of a mouthful isn’t it? And how about this from Wikipedia:
“Strategic planning is an organization’s process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy. It may also extend to control mechanisms for guiding the implementation of the strategy. Strategic planning became prominent in corporations during the 1960s and remains an important aspect of strategic management. It is executed by strategic planners or strategists, who involve many parties and research sources in their analysis of the organization and its relationship to the environment in which it competes.” (https://en.wikipedia.org/wiki/Strategic_planning)
This definition is a bit easier to read and it provides some helpful thoughts on the whole notion of strategic planning.
But what about a down-to-earth definition that is practical and captures the essence and purpose of strategic planning in layman’s terms? Here’s my no b.s definition of strategic planning which I believe is far easier to understand when compared to what you will find in a strategic planning textbook:
Yes, strategic planning is a high-value activity that involves setting a big, achievable goal and then figuring out the strategy and tactics – or the “how-to” – you need to achieve it.
Dictionary.com defines strategic as being “important in or essential to strategy”. So when we do something strategic we are performing an activity that is important, essential and highly valuable.
For any strategic planning initiative to be successful, you need to apply an effective strategic planning process. What does the process do? It analyses and answers questions in three crucial areas of success:
1. What is my big goal? When do I want it? Is it important to me? Is it achievable? (The Big Goal)
2. Where am I now and why am I here? (Current Position)
3. How can I reach my goal? What and who do I need? (Strategy and Tactics)
The key outputs produced by strategic planning are its strategy and tactics, which are the methods used to reach the goal. Strategy and tactics include ideas, insights, decisions and solutions to problems…and collectively these form the heart of your strategic plan.
Now, there are several important terms and planning tasks that are related to strategic planning, which I will elaborate on.
Relationship between strategic planning and strategic thinking
Strategic thinking is a common term that is tied to the hip to strategic planning, so let me explain the relationship between the two.
In terms of a definition strategic thinking is defined by Wikipedia as “a mental or thinking process applied by an individual in the context of achieving success in a game or other endeavor.” From this definition it is clear that strategic thinking is the thinking process one uses in strategic planning. It is the key input.
Strategic thinking is viewed as a creative, synthetic, intuitive and flexible type of thinking. Its polar opposite is sequential or structured thinking, which is viewed as being less flexible and creative, and more rigid.
The concept of strategic thinking arose in the early 1990s as a bit of a rebellion against formalised strategic planning – particularly in the corporate and government sectors – as the process of planning was seen by some to be too rigid and stifling. This rebellion was led by academics such as Professor Henry Mintzberg of McGill University, who argued that the term strategic planning was an oxymoron.
What makes strategic planning an oxymoron is the overuse of sequential thinking. Which then turns your planning away from strategic planning and more towards operational or functional planning.
What makes strategic planning work is the use of strategic thinking. Actually, strategic thinking is genuine, authentic strategic planning. Therefore strategic thinking needs to lead your strategic planning process.
Strategic planning versus long range planning
Long range planning involves looking 3-5 years in the future and then developing goals and strategies based on assumptions about what the future will look like. The reality with long range planning though is that no one can predict that far into the future or control the future environment with any degree of certainty. So long range planning has a strong crystal ball gazing element to it.
Strategic planning on the other hand is more dynamic, controllable and immediate. There is typically no long term time horizon, with planning going out 1 year to 18 months. Sometimes you may be able to go out longer than this, but only if the environment you’re competing in is very stable and predictable.
With strategic planning there is a level of both importance and urgency attached to it. In other words it’s the size, importance and even urgency of the goal or problem – and not the time line – that determines strategic nature and value of the planning process. So if you have a big goal with a small timeframe of 3 months to achieve it, then the planning you engage in will be strategic.
Strategic planning versus operational planning
Strategic planning focuses on the big, significant goals, while operational planning relates to goals and tasks that are more routine, administrative and operational in nature.
For example, when a firm develops a strategy to strengthen its values system and to attract high-calibre talent that matches these values, that is strategic. When this same firm runs a recruitment campaign to find a CEO, that is also strategic. But, when the firm runs a recruitment campaign to find junior to mid-level employees, that is operational.
Another example. When you set a goal and strategy to run a marathon, that is strategic. When you set your weekly running schedule, that is operational.
Strategic planning is one of the most important activities you can engage in, and is a necessary prerequisite for success in business, health and fitness and other areas of your life. To put it another way, to improve performance, you must first get better at strategic planning.
The best way to get better at strategic planning? Firstly, let creatively-driven strategic thinking drive the process. Secondly, follow a simple process like the one outlined above that focuses on the three key success areas:
- The Big Goal
- Our current position and why we are here
- Our strategy and tactics…or the “how tos”
Do these things well and you are well ahead of the pack in terms of your strategic planning ability.