Source: Insight

Strategies fail because of poor execution, which fails because of poor strategic planning. People are too obsessed with big ideas, and focus too little on the details. A recent study found that on the average, organizations achieve just over 60 percent of the goals in their strategic plan. Looked at another way, the average company can increase its achievements by more than 60 percent.

How to Improve the Planning Process

One of the major hurdles is getting the best partners to participate in planning. They are often too busy, so planning is done by whoever is available.

If the top leaders are not committed to the planning process, the plan will fail.

It is also important to get an outsider’s perspective. Insiders are sometimes too close to the issues to deal with them objectively.

An outside consultant can help by serving as a monitor.

Democracy is a word heard with increasing frequency in management. Employees should be involved in the planning. They will be unmotivated if they:

• Don’t know what changes are taking place.
• Why the changes are being made.
• What is being changed.
• How the changes are going to be made.

Don’t be complacent. If firms don’t change in response to changes in the environment, their current successes will not continue.

Don’t rely solely on pleasing current clients. New clients are essential. Consider the experience of Digital Equipment Corp. in the 70’s and 80’s. It decided not to participate in the personal computer revolution because its customers said they were not interested in PCs. Planning requires listening, not only to your current clients, but to future clients.

Here are some warning signs that your planning is in trouble:

• Ask employees if they can articulate the firm’s vision. If they cannot, you have a problem.
• You don’t know what metrics to use to measure your success.
• Employees aren’t having fun in their work.
• Customers are discontented.
• You don’t have strategic (outside) partners participating.

From Insight, The Magazine of the Illinois CPA Society, May/June 2006. For the complete article, click on the following link: http://www.icpas.org/hc-insight.aspx?id=900