A Strategic Plan in About an Hour
Research indicates that only 11% of senior executives feel good about their strategic planning process. The good news is that strategic planning doesn't have to take a long time to create one - heres a way to get an actionable plan in about an hour...
The process starts with confronting reality. It then moves to setting a vision for where you want to go. It ends with development of an innovation plan for moving from reality to your desired vision.
The Confronting Reality conversation starts with exploring where each of your revenue streams is on the continuum from commodity to monopoly.
The process involves a simple four column chart.
Column #1 (5 minutes) Make a chart of each of your major revenue streams. Revenue streams can be products, services, markets or however you think about revenue. If your organization has hundreds of offerings cluster them into revenue streams based on core technology.
Column #2 (10 minutes) Define each revenue stream based on where it is on the lifecycle curve. You have two options - Innovation or Commodity. The basis for this is how easy or difficult it is for you to hold price. Revenue Streams from offerings that are Meaningfully Unique hold price. Revenue Streams where it's hard to hold price are Commodities. You are only given two options because it's too easy to not confront reality and put everything in the center.
Column #3 (20 minutes) Make a Decision on Each Revenue Stream Your first Strategic Planning decision is to label in column #3 are you going to a) REINVENT (and restart lifecycle) or b) MILK IT (maximize profits and let it die).
Column #4 (10 minutes) Set a Date for Death or Rebirth For each revenue stream set the date for when you will introduce the next generation or the date you anticipate death for the revenue stream. Use your experience, judgement and intuition to set the date. By the way - the "death date" is usually sooner than you first imagine as the decline accelerates as it nears the end.
Last Step (15 minutes) Assess Your Portfolio and Make Adjustments Review the chart showing the various revenue streams and the dates for reinvention / death. Make adjustments to dates based on your instinct on work load.
Most important of all - step back and ask yourself is it enough given your goals and dreams for your organization? If you are like most organizations the reality will be that you will need more. You will need to, add VIO (Very Important Opportunity) X, Y and or Z to the list as placeholders for new revenue - from adapting for New Customers/Markets and or leading Current Customers.
There it is - in about an hour you have a first generation strategic plan that is action oriented.
• It's action oriented as it makes decisions to reinvent/milk each existing revenue stream.
• It's action oriented as there are clear dates for reinvention.
• It's action oriented as it deals with the "whole portfolio" not simply the parts.
With this basic strategic plan in place - you will now have a greater connection between strategy and tactics. The workers will now know what to do today, right now, this year to achieve your vision.
The next generation of a strategic plan is to step back - disconnect from the current reality andthink about where you really want to go longer term. This means thinking about how to "get ahead of the customers and markets." With Innovation Engineering this means crafting the Blue Cards™ for VIO (Very Important Opportunities for new/current customers) and VIS (Very Important Systems for how we work). Classically this is done in a project format we call Strategy Activation. Again, the goal is not to "create binders. " The goal is to create an actionable strategic plan.
Do it by yourself. Do it with other executives. Do it independently and share your outcomes.
Most importantly - Confront Reality - Make Decisions (you'll be wrong but making a decision will be useful as it sets you up for getting smarter) - and Take Action.