3 Ways CEOs Screw Up Strategic Plans

At one time, business executives believed that strategic planning was the answer to all of their problems. The process that started in the 1950’s evolved through various strategic analyses including SWOT (Strengths, Weaknesses, Opportunities and Threats), Michael Porter’s competitive strategy model, core competencies, strategic intent and business transformation. Today, many are questioning the usefulness of strategic plans. There are many reasons for this. I’ll give three:

1. Involvement of Strategic Planning Consultants.

Okay, I don’t want to tar every consultant with the same brush, but generally consultants take a bunch of company time going through endless analysis. They have to. Think about it; their meters are ticking. When all is said and done, the company will have a polished, professional-looking document that the Board of Directors will love.

But seldom do these strategic plans drive a company into the future. Trust me, the process will be repeated the next year, and other than a change in date, you will have a tough time telling the two plans apart.

2. Building the Plan From the Bottom Up.

Isn’t top management supposed to be the strategic experts of the organization? Assuming that is the case, shouldn’t the plan be generated top-down? “Oh no,” say strategic planning specialists. “If your employees aren’t involved in the process, you won’t have buy-in or satisfactory results.

Every CEO wants buy-in. Getting it is a case of the CEO sharing the plan with employees, communicating what should be done, why it should be done and how it will be done. If employees nod to that, the CEO has buy-in.

3. Thick, Convoluted Strategic Documents.

These are like company manuals on a book shelf collecting dust. Clarity and purpose to your what, why and how can be captured on one page, but this requires hard work and deep strategic thought. It’s like the saying, “I would have written a shorter letter, but I didn’t have the time.”

I was introduced to the one-page strategic plan format by my former employer, Jacobs Suchard (Toblerone, Milka, Nabob Coffee, Cote d’Or). For 15 years, I participated in the creation of the one-pager for Suchard. The process was excellent—several initiatives competing for a page of limited real estate, healthy debates on competitive advantage and timelines, and cultural soul searching.

In my consulting afterlife, I helped dozens of companies craft their own one-pagers. Every time I suggested the single page to a new client, the CEO would raise an eye. They would ask how something so important to the future of their companies possibly fit on a page and go on to say, “My business is different and way too complex for that.” But in the end, after much coaxing, they came on board.

I remember the day I convinced the CEO of a $2 billion company with three divisions to opt for focus and clarity. Seven years later, that business boasted another billion in sales. Was it the one-pager? No. It was the clarity of purpose that the one-pager represented as well as strategic tenacity and flawless execution.

  • ash varma

    Very interesting perspective, Mr. Bell. I think that there is a lot to be said for clarity — and simplicity — with respect to Strategy. Interestingly, in the area of Financings, we see a similar such trend, as well. Very infortmative! Thanks for sharing. Regards.

  • http://twitter.com/JohnRichardBell John R. Bell

    Thank you, Ash. Leaders talk clarity and consistency, but when things get tough so many go the other way, looking to do more and more in the hope of finding the magic bullet of resolution.

  • http://twitter.com/ajcatterson Anthony Catterson

    couldn’t agree more. The best businesses do small numbers of things excellently, and a lot of companies confuse width of activity with productivity.

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