Center for Simplified Strategic Planning

Category: Strategic Planning

  • What’s the Right Number of Market Segments?

    by Robert W. Bradford, President/CEO 

    Strategic Planning Expert Robert Bradford

    For years, we’ve told people that too many market segments leads to bloated and ineffective planning.  This is true – at some point, you simply end up with more details than your team can wrestle with in your strategic planning. 

    It is, however, also possible to have too few market segments.  Certainly, the ridiculous “one page” strategic planning fad has given us examples of companies that have failed to reach their potential because they are taking a “one size fits all” approach to market segments. 

    Treating every customer the same is certainly convenient if you want to get your strategic planning done quickly, but it robs you of the ability to cater to the specific needs and preferences of distinct customer groups.  One of the critical changes we are seeing in every industry is a trend towards greater segmentation.  As an example, consider the market for hot sauce. 

    A few years ago, you would find Tabasco sauce and not much else in many grocery stores and restaurants.  Today, you can find entire stores that sell nothing but hot sauce (and hot sauce related items), and they may carry hundreds of different brands, including several segmented flavorings of the original Tabasco brand.  

    This kind of segmentation is the result of customers seeking products and services that meet their exact needs, which are not necessarily your needs.  The reason we are seeing more segmentation today is that improved information technology, distribution systems, and the ability of the internet to deliver highly focused marketing enable producers to target and sell to narrower segments much more efficiently than in the past. 

    So…how many segments should you have?  As a rule of thumb, you will find that you can manage about 6-8 segments with most strategic planning teams.  Fewer segments may be acceptable if you cannot identify enough targetable behavior groupings in your markets – but beware, if you fail to identify a viable sub-segment, your competitors may, leaving you with a poor image with that group of customers. 

    This economic recovery is a good time to reassess your market segments:  have your strategic planning team develop a number of different segmentation schemes – more than the usual product/service vs. market matrix.  You may look at slicing your markets by use or application, by channel and/or by geography.  Use this time to re-engage your team to think creatively about where the true differences are among your customer groups.  You may uncover a clearly differentiated segment that has emerged during the recession – this segment may be fundamental to enhancing your company’s growth and profitability.  While you may not significantly change your segmentation, this work will allow your team to think about your customers and renew the commitment to your strategic planning process as you plan for growth in the years to come.  

    For additional thoughts on how to position your company for success please read:  Three Keys to Recovery Success: Re-focus Your Efforts to Outperform Your Competition 

    Robert Bradford is President/CEO of the Center for Simplified Strategic Planning, Inc.  He can be reached at rbradford@cssp.com.

  • Are You Really On Track? Mistakes Made in Execution

    By Denise Harrison, Vice President

    Strategic Planning Expert

    Is your team honest with itself when discussing progress of your action plans?  Or is your team convincing itself that things are really on-track when they aren’t even close?  Recently I have come across a number of cases where teams have given themselves high marks on achievement, but the real strategic objective has not been reached.  Here are four examples of how you might be negatively impacting your strategic results by accepting less than optimal progress.

    1. Redefining the objective
      Recently I observed a team celebrating the success of achieving one of their key strategic objectives.  The progress that had been made was significant: a new product launch. But did it really accomplish what we had set out in the original strategic objective?  The original project was to scope out the requirements of a particular market segment.  Significant regulatory changes had occurred during the year and these changes will impact this segment’s needs/preferences for the foreseeable future.  The product launch was a good thing for the business, but not the completion of the strategic objective – it totally missed doing primary research to understand the full impact of the regulatory changes.  In the short-term, the product launch would shore up revenues, but the team missed the long-term opportunity to help its customers navigate through the regulatory changes by providing unique solutions to the opportunities/issues that resulted from the change in regulations.  Don’t redefine your objectives so that you easily meet your targets using projects that are already in flight.  Be sure that your objectives are well defined going into the process and make sure that you continually check that the action plans are accomplishing what you actually set out to achieve with the strategic objective.
    2. Only look at exceptions during the monitoring process
      In order to speed up monitoring meetings, some teams choose to just look at the action plans that are not on schedule.  This allows the team to focus on the key projects that are not moving forward as planned and allows the team to have discussions concerning the impediments to progress and ways of overcoming these impediments.  However, this approach misses an important aspect of the monitoring process:  communication.  Communicating progress on action plans that are on-track keeps the whole team informed and updates the team regarding changes to the plan.  Sometimes project leaders keep the plan on-track even though there have been significant changes to the scope of the plan so that the plan does not fall under the scrutiny of the strategic management team.  This allows key strategic objectives to go off-track because the rest of the team is not alerted to the changes.  In addition, the communication of progress allows senior management team members to suggest enhancements that were not included in the original action plan.  So, don’t assume the purpose of the monitoring meeting is simply to keep the action plans on track, the communication of where we are on key strategic objectives is also important.  This allows the whole senior management team to stay engaged on projects where they do not have an active role.
    3. Defining “on-track” as being “on-track” with the things that you control
      Yes, this really happens…a team has a project that is significantly “off-track” due to events beyond its control and instead of simply identifying this, the team says it is “on-track” because the problems were not of the project team’s doing.  Beneficial? No!  When something is off-track, it is off-track – this is not an assessment of blame, but an acknowledgement of actual progress.  This accurate assessment is important for three reasons:

      1.  To communicate to those on the team that a key strategic objective is not going to be completed in a timely fashion.  This is important to know, as this is key to achieving our strategy.
      2. To allow the group to brainstorm on ways to overcome the impediments and perhaps come up with creative solutions to the problem(s).
      3. To allow the group to re-deploy resources, if, in fact, this strategic objective is really dead in the water.
    4. Declaring victory before the actual objective is reached
      Remember the infamous “Mission Accomplished” banner on the aircraft carrier? Do your objectives really state the desired objectives?  Do you declare victory when your product and/or service is launched?  Or when the acquisition is complete?  Or do you declare victory when you have reached the stated revenue/profit numbers that give you the ROI that justified the project in the first place?  If you declare victory before you have actually achieved the metrics defined as success, you are cheating yourself out of the full potential for the project, as resources can be redeployed to other projects before this strategic objective is really complete.  This causes a great deal of frustration within organizations, as a project’s potential is not achieved due to the loss of focus.

    Is it time to tune-up your monitoring process?  Is your team being honest about its progress?  The next time your team reviews its strategic objectives or key projects ask the following questions:

    1. Are we really achieving what we set out to achieve? Are we being honest with ourselves concerning the progress that is being made?
    2. If not, how can we fix it?
    3. Do we need to take some projects off the table to ensure we are making progress on the critical few?
    4. Do your objectives really focus on the desired result?
    5. Have we added projects without taking anything off the list?

    Take a look at your past progress and see if you are really being honest with yourself.  If not you can make significant progress by plugging the leaks in your monitoring process.  If you are not making the progress you want, or if you have fallen into the traps above, the Center for Simplified Strategic Planning can help you get back on track.  Contact us to help you regain your focus.

    For additional information on how to enhance your execution success please read: Everyone Knows Execution is Important – So Why Do We Fail to Execute?

    Denise Harrison is Vice President of the Center for Simplified Strategic Planning, Inc.  She can be reached at harrison@cssp.com.

  • How Agile is Your Company?

    by M. Dana Baldwin, Senior Consultant

    Strategic Planning Expert

    Great Companies develop Strategic Plans which incorporate agility in execution.  What is generally meant by being agile?

    Most companies intend to carry out their goal of being agile by becoming more responsive, more sensitive to meeting their customers’ needs and preferences and doing all of this more rapidly.

    How does a company become more agile?  Much of the process of becoming agile is more easily said than done. In order to be more agile, the culture within the company has to change.  Control must be ceded down further into the organization. This means that senior managers must do a number of things which will lessen their direct control over what is happening day to day, communicate much better and at deeper levels within the company, and change the way in which their subordinates operate.

    Many companies dictate exactly what an individual may do, and may not do, in the performance of their daily jobs. In order to become more agile, and to become more effective at being agile, the whole approach must shift. The subordinates must have a clear understanding of what is wanted in terms of performance and actions in order to carry out the mission of the company. This means that their instructions must evolve from “you will do this task, this way” to “this is the result we want from you, and you have the freedom and the responsibility to act within these parameters to accomplish your job.”

    To do this effectively, the senior managers must develop effective communications with each individual, must develop sufficient trust in the capabilities and training of each individual – that each one knows and understands what the overall goals and strategies are for the company, and how each of their actions may have an impact on the ultimate results, including the overall satisfaction of the individual customer.

    Agile companies tend to listen well to their customers. When there is good input from customers that may affect the course and direction of the company, each person is encouraged to pass along this information to the higher-ups in order to take advantage of the broader insight offered by the customers. To do this, everyone needs to know the strategic direction of the company, and how their actions may influence the results.

    In the long run, the company must develop and maintain a high level of trust, both from manager to subordinate, and from subordinate to manager. To effect this, there must be good communication each way in the relationships, so that the unusual situation may be isolated and dealt with at the proper level, but also, and more importantly, so that the daily processes become almost routine, with their quick response, proper results and high levels of customer satisfaction the expected and achieved norm.

    To do this effectively, a company needs to have a clear, concise and actionable strategic plan. It needs to communicate this plan throughout the company, so that every person perceives how his or her actions may impact the results for the company. It means that managers must develop and use effective communications within the company. And it means that customers will perceive the improved response times and results so their satisfaction with the company is higher. This should result in improved relationships with customers, and within the company.  If your company needs effective, efficient guidance in developing your internal and external strategies, contact the Center for Simplified Strategic Planning Inc. at www.cssp.com

    M. Dana Baldwin is a Senior Consultant with Center for Simplified Strategic Planning, Inc. and can be reached at .

  • Can a Strategic Plan be TOO Simple?

    By Robert W. Bradford,  President/CEO

    Strategic Planning Expert Robert Bradford

    At the Center for Simplified Strategic Planning, we have always valued simplicity.  Lately, however, we have noticed the growing popularity of extremely brief strategic plans -many of them touting themselves as “one page strategic planning”.  While some strategies could indeed be summarized in a single page, my own belief is that there is such a thing as oversimplification in strategic planning.  There are many reasons why an OVERsimplified plan is inferior to one with more detail – today I am going to examine just one of these reasons.

    A strategic plan must encompass the directional intent of the team that produced it.  To succeed, it also must incorporate adequate understanding of the factors – both environmental and internal – which will affect the organization’s ability to fulfill the intent of the planning team??. To be a useful tool, the plan must also be understandable by team members at various points in the execution of the plan.

    This last attribute – the communicability of the plan – is one of the most important reasons to incorporate far more than one page of data in your strategic planning.  To really execute well, your team will often need to know more than just what the strategy is – they really need to know WHY the strategies are what they are.  This cannot adequately be done without including the salient environmental and internal data in your plan – as well as some of the analysis that leads from the data to the concluding strategies you developed.

    Far too often, I’ve seen teams use cryptic notes in their strategic planning documents and then scratch their heads a few months later wondering why they devised the strategy they did.  Yes, it’s possible to piece the analysis together, if your managers are smart and have good memories.  But this means that a good deal of your strategic thinking time will be wasted on rehashing the same analysis over and over, instead of extending your thinking into an improved vision for your organization.

    Communication is critical to strategic success in another way that comes up fairly frequently: when you focus too much of your attention on a shortened statement of desired results, the law of unintended consequences kicks in.  This is most often apparent in the constant struggle between growth and profitability in business plans.  My experience bears out that very high growth and very high profitability rarely correlate.  In fact, when we looked at a summary of results among the long-term clients of  the Center for Simplified Strategic Planning, we found that the top quartile in profit growth was always in the bottom quartile in volume growth – and vice versa. 

    A very simple, and often encountered example of how the law of unintended consequences pops up in an oversimplified strategy was well-stated by one of my clients, who said “Our strategy was to grow by 30 percent a year for five years, and we accomplished that despite terrible issues in our industry – but I wish we had listened to your admonishments to focus on profit, as well.”  The client’s highly focused efforts to grow their sales volume succeeded – and they executed very well – but their profit margins declined continuously as their appetite for growth drove them to take on less desirable customers.  Accepting the need for a more complex strategy enabled this client to resume a steady 15% growth rate in both profit and volume, with much healthier long-term prospects for success.

    I am not agitating here for a strategic plan that is a huge, thick file of notes explaining every nuance of your decision making process, but I am suggesting that including enough pages of analysis and data will help your team’s strategic thinking now and in the future.

    The key here is to balance richness with usability.  An extremely rich plan is too long – but for most organizations, the desire for simplicity may cause you to oversimplify your plan to the absurdly short “Go make money”, which, while easy to understand, creates no value as a management tool.

    Robert Bradford is President/CEO of the Center for Simplified Strategic Planning, Inc.  He can be reached at rbradford@cssp.com.

  • “What if” Oil and Water Do Not Mix – Lessons from BP

    By Denise Harrison, Vice President

    Strategic Planning Expert

    Strategic planning and risk assessment – yes, you must look at what would happen if…If you fail to assess and mitigate risk during strategic planning you could end up with a BP-like disaster.  While the exact causes of the Macondo rig disaster are not yet known, it is nonetheless fair to ask: “Was this a Threat or did BP shoot themselves in the foot?” Well, probably both actually. 

    THREATS

    Threats are events that occur due to external forces outside of your control and which significantly impact your business.  Examples include recessions, hurricanes, the death of a key employee, and/or competitors merging (to name a few).  In BP’s case, the drilling team seemingly did not adequately prepare for the oil reservoir pressure exceeding the well’s engineered capacity, and the resulting blow-out. What should they have done to mitigate the risk? Here are five suggestions: your strategic planning should examine each and select the best mix. 

    Prevent

    BP first and foremost should have considered how they could prevent a blowout from happening:  this well was an exceptionally deep well, so engineering standards should have been set high.  Cutting costs or speeding up the timeframe for the well to come on line should have been weighed against the high-risk nature of a deep-water well.  High risk?  The depth of the well makes adjustments difficult because everything needs to be adjusted by remotely-controlled tools and vehicles in conditions where the significant water pressure adds complexity to any operation. 

    Reduce Exposure

    Plans should have been in place for a well blowout, as well as plans for evacuation and spill containment.  Evaluation:  all but eleven people were able to evacuate the drilling rig.  But the disaster far exceeded what happened on the rig platform.  The disaster on the surface was the first hint of the catastrophe that was happening beneath the surface.  As has become apparent, BP did not have adequate plans in place to mitigate the massive amounts of oil that began spewing from the well.  

    Early Warning

    Yes, there apparently were early warning signs – and these should have been signals to slow down the well completion process; not pour the mud and the cement until the pressure was understood, slowing down so that adjustments could be made that would insure the integrity of the well.  If early warning signs had been heeded and appropriate procedures been in place, the drilling team might have taken the time to truly assess what was really happening a mile beneath the water’s surface. 

    Contingency

    There are also questions with regard to the ill-fated blowout preventer: were all the checks done completely; were some shortcuts taken; were any and all changes to the design fully tested before the blow-out preventer was installed?  Was the effectiveness of redundancy exploited fully? 

    Hedge

    Typically, we look at ways to hedge when mitigating risk, but there are not necessarily ways to hedge every threat.  In this case, drilling could have been stopped and other wells could have provided oil.  Also, relief wells could have been drilled when the integrity of the well was suspect. 

    Had BP really examined their threats, they would have had better plans in place and might have prevented the disaster which will render the well useless and cost BP billions of dollars in funds for clean up.  It is important when developing threats that people understand what the implications of the threat could really look like – so scenario planning might be in order.    For instance, a threat could be a hurricane, but you might have different scenarios for a category 1 hurricane, a category 3 hurricane, and a category 5 hurricane.  I was working with one team which identified hurricanes as a threat and the team came up with mitigating strategies for category 1 and 3 hurricanes – however, they decided that mitigating the risk of a category 5 was not possible, so a contingency plan was developed:  Evacuate and take care of the people; lock down the production facility as suggested in the plans for a 1 and 3, but understand that the people’s safety came first.  In addition, they developed a clean-up plan for after the devastation of a category 5 hurricane.                        

    NOW, SHOOTING YOURSELF IN THE FOOT

    Shooting Yourself in the Foot involves a self-inflicted blunder. Apparently BP did not have robust plans to mitigate the risk of the well blowout Threat.   Besides having a poor risk mitigation strategy, they also shot themselves in the foot by having only a short-term mindset which prevented them from properly investing (both time and money) in this high-risk, deep water well.  This short-term focus caused them to spend less, increasing the risk and increasing the downside consequences of the higher risk. Not only will the well be shutdown for good and the upfront investment costs of designing and drilling the well lost, but the resulting environmental disaster will also require significant spending to clean up the mess they made.  Additionally, their reputation will be tarnished forever.  Short-term thinking did not only lower this well’s future returns; it obliterated all future returns from this well, as well as cutting into BP’s future earnings and market value. 

    Lessons Learned

    It is important during strategic planning to think about growth and about profitable growth, but don’t put blinders on and simply chase growth and profit. Taking the time and spending the money to mitigate risk and protecting yourself from downside exposure will save you money in the long-run.  It may well spell the difference between profitable growth and unmitigated disaster.  As you develop your strategic planning, spend time on risk assessment and mitigation of Threats posed by external forces.  In addition, be sure that you take some time and identify ways that you could Shoot Yourself in the Foot, and discuss options which you might pursue to avoid losing your toes.

    Denise Harrison is Vice President of the Center for Simplified Strategic Planning, Inc.  She can be reached at harrison@cssp.com.

  • Strategy Analysis: Expand

    by M. Dana Baldwin, Senior Consultant

    Strategic Planning Expert

    In strategic planning, there are five basic strategies one may pursue: Expand, Maintain, Contract, Milk or Withdraw.  The most aggressive strategy is Expand.  What does an Expand strategy encompass?

    First, let’s define the Expand strategy so we have a basis on which to base discussion.  The dictionary defines expand as: to increase the extent, number, volume, or scope of, to enlarge. We further define an expand strategy as one in which we are growing significantly faster than the market or market segment is growing overall.

    To follow an expand strategy, a company must decide to provide the resources which will support the targeted growth rate.  It implies that the company’s growth will absorb much of the real growth of the markets in which the company is competing.  It also implies that the company is willing to take on competitors in order to take market share from them, in addition to absorbing the growth in the market place itself.

    Before we select the expand strategy, we need to look in depth at each market segment to see whether it will qualify for an expand strategy.  What are the requirements that a market segment should have in order to be eligible for an expand strategy?

    First, we need to be able to have sufficient resources, both people and money, to properly support the strategy to expand our sales volume in each affected market segment.  An expansion strategy can be quite expensive, and will likely absorb a lot of time of some key people in your company.

    Second, it should be in a relatively attractive market.  We use a 3 x 3 matrix to demonstrate how attractive a market segment is, and also how strong a competitor we are relative to our own competition.

    When you look at the matrix above, you can readily see that the market attractiveness for the suggested strategy of expand is high.  Notice too, that the competitive strength (vertical axis) may range from being a weak competitor/new entry to being a strong, dominant competitor.  Our goal over time is to move our competitive position up the axis to the strongest possible competitive position.

    Often it won’t make a lot of sense to expand in a less attractive market segment.  The one exception for this is in a moderately attractive market in which you are the dominant player.  If the potential for a good long term reward is present in a moderately attractive segment where you are a strong number one, then expand should certainly be considered.

    Many companies simply do not have the depth of resources – usually people resources – to support too many expand strategies.  Companies need to select the few markets where they want to expend the resources to significantly gain market share.  Focusing resources is paramount to any plan’s success – so your team should not try to expand in all markets.  Rather, we suggest pick the 2-3 that, given the effort, will deliver the most bang for your buck.  We find that if you force the team to pick only 2-3 expand strategies immediately, a few “winners” will be chosen.  This selection of only a few “expands” helps ensure that a team will be successful on the chosen markets.

    In conclusion, an expand strategy is a strong bet on your company’s ability to grab market share at a rate higher than the market is expanding, with the goal of increasing your return on investment over time.  This means you will aim to increase your top line sales and bottom line profits at a rate higher than the additional costs you will be incurring in your expansion efforts.

    For detailed directions for using the expand strategy in your Simplified Strategic Planning process go to Simplified Strategic Planning book.

    M. Dana Baldwin is a Senior Consultant with Center for Simplified Strategic Planning, Inc. and can be reached at baldwin@cssp.com.

    © Copyright 2010 by Center for Simplified Strategic Planning, Inc., Ann Arbor, MI — Reprint permission granted with full attribution.

  • Finding Resistance

    By Robert W. Bradford, President/CEO

    Robert Bradford
    Strategic Planning Expert Robert Bradford

    In strategy, you will inevitably find resistance to your plans.  This resistance is sometimes forceful, and other times something you can overcome with resources and effort.  An interesting question is how to deal with resistance.  Should you always push hard to overcome resistance to your strategic objectives (probably not) – or should you allow resistance to stop you every time the going gets hard (also probably not)?

    There are several key questions to ask yourself about the resistance you encounter to your strategic objectives.  First, what is the nature of the resistance?  Are you finding the objective difficult because of competition, the learning required, or the resources required?  Second, is the resistance something that is even possible to overcome?  Third – and very importantly – how important is the objective to your strategic success?

    Very often, the thing that separates great companies from OK companies is the willingness to do difficult things.  A great company will often (but not always) undertake to overcome obstacles that stand between it and true strategic differentiation.  OK companies allow themselves to be stopped by adversity.

    This does not mean that you must always persevere to be great.  Another hallmark of great companies is the ability to give up where it is appropriate.  Not too soon – but also not delayed where the end result will be a large consumption of resources with little or no forward strategic motion.

    What kind of organization is yours?  Do you show perseverance or are you stoppable?  And when you persevere, how do you assure that you are not spinning your wheels, attempting to overcome difficult resistance that will lead to little gain? 

    Robert Bradford is President/CEO of the Center for Simplified Strategic Planning, Inc.  He can be reached at .

  • Everyone Knows Execution is Important – So Why Do We Fail to Execute?

    Strategic Planning Expert

    By Denise Harrison, Vice President

    Execution of strategy: we know it is important, but why doesn’t it happen? Based on my experience working with over 100 companies on strategy development there are four key areas that lead to execution success.

    1. Focus on the few:
      1. Select a few – 8-10 key strategic objectives to accomplish in the next 12 – 18 months. No more than 10! Don’t fall into the trap of “We have to do this!” and end up with 12 to 15. It is better to work on a few rather than work on everything and get nothing completed. Four to six is even better, especially if the objectives are large.
      2. Once you have selected the key objectives, then develop action plans that are detailed roadmaps of how you will accomplish these objectives:
        1. What are the action steps (granular detail)?
        2. Who is involved with/responsible for each step?
        3. How much time will each step take?
        4. How much money will each step cost?
    2. Balance your resources:
      1. Now you know the amount of time and money for each objective, do you have enough resources? Do you have the right resources?
        1. Often the required financial resources are clarified in the budgeting process
        2. The human resource aspect is often lightly considered (if at all) and this is where many implementation plans go off-track.
          1. Understand that your people have day-to-day activities that help the business run in addition to the projects that will position the company for future growth; you have to balance these requirements so that both are accomplished.
          2. If you find that you do not have the resources to accomplish your action plans, evaluate how you can
            1. Delegate (both routine as well as project activities)
            2. Eliminate (routine and/or project)
            3. Reduce (routine and/or project)
            4. Postpone (project only – you can’t postpone routine activities; they just don’t happen)
          3. The operative word here is balance!
    3. Monitor your progress:
      1. Monthly have your action plan team leaders report on their progress to the strategic planning team
        1. Work with the team to relieve bottlenecks if projects are behind
        2. The strategic planning team should be able to help reduce bottlenecks – use this meeting as a solution-finding meeting rather than a way to assess blame. The team should be working together to move things forward.
      2. If new projects come up, then evaluate each project in the context of what has already been selected.
        1. If the new project is more important than one of the current key objectives, then add it, but be sure to take one away.
        2. Do not pile objectives on top of one another – sometimes we assume that we have hatched new resources during the year.
        3. Do not evaluate new projects in isolation – evaluate them in the context of the projects that are already on your plate. If the current projects need to stay on the list, save the new one for next year’s strategic planning.
    4. Communicate early and often
      1. Communicate the strategy and key objectives to all employees
        1. Make sure that communication is clear and concise
        2. Make sure the communication is two-way (see article: Lessons Learned in Aligning an Organization -Two Way Communication is Key)
          1. Give employees a way to react
          2. Have them prepare what their departments are going to do in support of the strategy and key objects – make sure the communication is two-way.
      2. Communicate frequently and update when changes occur.
      3. If everyone in the boat has his/her oar in the water and everyone is rowing in the same direction as the company, it will move forward quickly – outpacing the competition.

    Efficient strategic execution is paramount to outperforming your competition during this recovery phase of the economy.  If you accomplish these four steps you should achieve over 90% of your objectives within the timeframe selected.

    Denise Harrison is Vice President of the Center for Simplified Strategic Planning, Inc.  She can be reached at harrison@cssp.com.

  • Next Steps: Will we be ready to take advantage of the improving economy as it arrives?

    Strategic Planning Expert
    Strategic Planning Expert

    by M. Dana Baldwin, Senior Consultant

    In my prior article (“Time to Start Planning for Growth – Step One: Analysis“), we discussed the lessons we should be learning from the major slowdown in business experienced during the recession, and how to analyze them so we would be positioned to plan to grow as business improves.

    As indicated in the previous article, we tried to learn what our markets would be looking for as their business improves.  We studied the competition to learn how they were reacting to the slowdown in business during the recession.  We probed for weaknesses and looked to see where our competitors pulled back and possibly even lowered service levels.  We tried to anticipate what the market would be asking for as business improved in order to be positioned to better serve the market in the future. 

    Now that it appears that the recession is ebbing, and growth is returning to the economy, what steps should our company be taking to establish strategies that will lead to improving our sales and our profits? 

    First, we need to revisit our strategic planning.  In order to take the best advantage of our earlier work, we must review our market segments to obtain the best information on which we will base our strategies.  Especially important is the updating of our assumptions.  The efficacy of our work on assumptions will guide our future course and direction, so the importance of doing this well and thoroughly cannot be overemphasized.  Good work here will mean we likely will have appropriate strategies for our core market segments. 

    Another key part of strategic planning is our focus on new opportunities.  Part of our work to establish our future course and direction will be started with our brainstorming of perceived opportunities.  At least some of these perceived opportunities should come from the analysis we did in our pre-planning efforts (discussed in the prior article).  These efforts should have resulted in our looking for what our customers and prospective customers will be seeking as they recover, and should be targeted at responding to their anticipated needs and preferences. 

    Once we have established the products and services which our markets – both current customers and future prospects – will be seeking, we need to determine what our responses will be.  We need to assess each opportunity to determine how each one will address the future needs and preferences of our prospects, and how each one will fit into our future.  How does each relate to our capabilities and our strategic competency?  Is each opportunity a good fit with our course and direction?  Selecting those which fit our future direction and which utilize our strengths and competencies, and which meet the anticipated needs of our customers and prospects is a key to our future success. 

    Next step is the actual execution of our strategies and our action plans.  Action plans are simply the step by step roadmap which will be used to accomplish our objectives.  A detailed action plan with responsibilities assigned and dates agreed upon is the key tool in accomplishing the objective.  Monthly update meetings are used to keep our action plans on time.  In the monthly update sessions, the action plan leaders report on progress, confirm schedules for the upcoming month and make any updates or changes needed to make the action plan effective.  Pulling all this together and getting our strategies and action plans executed effectively are keys to our profitability in the future. 

    If you’ve been dragging your feet about doing SP because of the cost or uncertainty, “bite the bullet, and get going”.  It’s ultimately about execution, but intelligent formulation of strategic direction is necessary first. And the time is now! 

    M. Dana Baldwin is a Senior Consultant with Center for Simplified Strategic Planning, Inc. and can be reached at baldwin@cssp.com.

    © Copyright 2010 by Center for Simplified Strategic Planning, Inc., Ann Arbor, MI — Reprint permission granted with full attribution.

  • We Never Have Time for Strategic Planning!

    By Robert W. Bradford, President/CEO

    Robert Bradford
    Strategic Planning Expert Robert Bradford

    I’ve heard this comment from people who are very successful.  People who are running companies that – for the moment – are doing quite well.  And yet, this comment puzzles me, mightily.  It puzzles me because strategic planning is about doing the right thing in the right place at the right time.  What could be more important than that?

    When someone says they don’t have time for strategic planning, they don’t really mean they don’t have time.  Everyone has the same 24 hours in a day, 7 days a week.  Some do strategic planning, while others spend their time on other activities.  What “I don’t have time for strategic planning” really means is “I haven’t made strategic planning a PRIORITY”.  This scares me some times – when I hear it from people running larger companies – and it saddens me at other times, when I think about what any company can become with better strategic planning.

    In the course of my work, I’ve encountered lots of people who run great companies.  Lots of them wanted to work with me on strategy development – and I have heard the excuse “I don’t have time for strategic planning” from many of them.  Sadly, some of them really needed it, and went out of business a few years later, after “not having time” for strategy.  Some of them I have ended up working with and they have unanimously said “We wish we had found time for this years ago!”   There is no question that companies that do strategic planning well end up much farther down the path to success faster than those who try to just “muddle through”.

    The truth is, developing a strategic plan often creates the feeling you have MORE time, not less.  This is because good strategic planning helps the whole team focus on the things that will truly drive your company forward, instead of tugging your organization in six different directions.  Also, a good strategic plan will help you find activities that you are spending time and money on right now that aren’t moving you forward – so you can stop doing things that are just a waste of time and money.  If you are familiar with Simplified Strategic Planning, you also know that the best process also pays very close attention to strategic issues that you do or do not have time for – and helps you to assure that highest priority is given to the issues most critical to your success.

    So, what kind of company is yours?  Do you have time to assure you are doing the right thing in the right place at the right time?  Do you have time to build a dependable framework for growth and viability for your company?  Or are you waiting until you feel you have “enough time” to do it?  Take it from someone who has seen this come up a hundred times – there is no “right” time to do strategic planning.  Don’t make the mistake of waiting for the right time only to find your best opportunities have passed you by.  Schedule your next strategic planning meeting now!

    Robert Bradford is President/CEO of the Center for Simplified Strategic Planning, Inc.  He can be reached at .

  • Three Keys to Recovery Success:Re-focus Your Efforts to Outperform Your Competition

    By Denise Harrison, Vice President

    Strategic Planning Expert
    Strategic Planning Expert

    Recently I was talking to a company president – he was frustrated that a large project was off track.  What happened?  Well, during the recession, his team bid on a significant contract for a large company; the contract included requirements that were a stretch for his company.  Traditionally the team focused on small to mid-sized businesses, but during the recession they decided to bid on this contract in order to bring in additional revenue.  The result?  Resources were being pulled off other projects to meet these requirements, and unfortunately the large customer was not happy because the project was not progressing smoothly.  Even worse, the smaller traditional customers were unhappy because resources normally available to them were working on the large project.  Has the recession caused your company to take on business that is pulling you away from profitable business? 

    Re-focus Your Efforts 

    Yes, during a recession it is easy to look at any business as good business.  But often companies take on business that does not leverage their competencies and/or causes it to misallocate resources. This new business may cause resources to be spread too thinly, working on projects that may bring in revenue, but are not profitable, or, more critically, divert resources from core, profitable customers.  In order to emerge from the recession in a strong position, it is important that you take the following three steps: 

    1.      Re-assess what your company does well: “Know thyself”

    a.       Understand where your competencies are:  what are those skills, processes and knowledge that are most valuable to your customers?

    b.      Know what your company does do well, and what it does not do well, so you will concentrate on serving the customers who value what you do not only during the recession, but for the long term.

    2.      Identify market segments or customer groups that you currently serve – and focus on the ones who value what you do well: “Cherish thy core”

    a.       Do these segments/customers select your company because they value the things that you are good at doing? These are the customers that will be profitable.

    b.      Or are there some segments/customers that simply came to you during the recession when you were trying to get business – any business to shore up the top-line. Re-focus on the profitable segments.

    3.      Once you have identified the segments that value your competencies then look within the segment and identify who the winning customers will be during this recovery: “Know thy customers”

    a.       Customers who were doing well before the recession may not be the same ones who are doing well after the recession. 

               i.      Some customers within these segments are not positioned to grow during the recovery.  Many         have taken cuts that will not allow them to take advantage of the recovery. Others are still hurting financially.

               ii.      Industries may have changed and requirements for gaining market share may have altered – different companies make take the lead.  Look at how the landscape in the financial industry has changed – some market participants are gone – others merged with more successful companies. Identify who the winners will be during this recovery. 

    Often recessions cause you to de-focus your efforts.  As you develop your strategy for the recovery make sure your team re-focuses its efforts so that it is concentrating on leveraging the competencies that you have and that your customers value.   These will be the segments and customers that will allow your company to grow profitably during this recovery. This renewed focus will allow your team to outperform your less disciplined competitors who are still chasing business, as if all business is good business.

    Denise Harrison is Vice President of the Center for Simplified Strategic Planning, Inc.  She can be reached at harrison@cssp.com.

  • Time to Start Planning for Growth – Step One: Analysis

    By M. Dana Baldwin, Senior Consultant

    Strategic Planning Expert
    Strategic Planning Expert

    As we get further into 2010, the time has come to start planning for the uptick in the economy.  No, it likely will not be a “V” shaped recovery.  And, if the government and the Federal Reserve get it wrong, we could have a “W” shaped double dip rather than a recovery.  But, sooner or later, the economy will recover, and you would do well to plan for it and to be ready when the indicators turn positive essentially across the board.  

    So, what is involved in this planning for the recovery?  To be ready, there are a number of areas you should check out and be ready for.  First: will your customers after the recovery begins be the same customers you were selling before and during the recession?  Have you serviced them well enough that they will continue to want to do business with you?  Do you have the relationships deeply enough established that you will continue to enjoy their business in the future? 

    Second: What will you be selling in the future, as compared with what you sold prior to the slowdown, and with what you actually were selling during the slow period we are just beginning to emerge from now? 

    Third: What do you want to sell going forward?  Are there any lessons you have learned about your business, your products and services, that can translate forward into more business, more profits and better products and services for your customers, present and future?  What did you do well for your customers during the slowdown, and what did you learn about yourself, your products and services, and your customers that will make your future better and more profitable? 

    Fourth: Why were you able to sustain your business during the recession?  What was it that your customers valued that kept your business viable?  What did you stop doing during the recession that impacted your bottom line, either positively or negatively?  What did you learn from the changes you made in order to get through the tough times?  How can these lessons be applied toward ensuring success as business improves? 

    We have posed a lot of questions above, and getting the answers will involve considerable effort and introspection.  The challenges of the future must be analyzed objectively and systematically in order to learn from the events so we may prosper as the economic activity improves.  At the same time, we must be objective about making changes to support increased activities, so we do not lag behind the curve and miss opportunities, and so we don’t leap too far, burdening our companies with increased costs and commitments. 

    This is where a formal, well-structured, objective strategic planning process comes into play.  In order to be properly prepared, with milestones for making changes, and contingency plans for various scenarios, a thorough planning process is key to steering toward success.  Without an objective analysis of the past, along with a realistic set of goals, objectives and strategies to follow for the future, you may not be able to take advantage of the opportunities which will come along as the economic atmosphere improves.  Planning is essential for success, and this planning should likely start soon so you are prepared when the tide changes.

    M. Dana Baldwin is a Senior Consultant with Center for Simplified Strategic Planning, Inc. and can be reached at baldwin@cssp.com.

    © Copyright 2010 by Center for Simplified Strategic Planning, Inc., Ann Arbor, MI — Reprint permission granted with full attribution.