It’s that time of the year when businesses take stock of their annual business performance and start working on the plans for the incoming year. This post is meant to provide a big-picture guide for leaders to create a new basis of strategic planning and keeping that big-picture firmly in view whilst developing the minutiae of each activity.
Now the usual approach, to planning, would be to look at the financials and work back from there as to what is working and what’s not and then plot targets for the new year.
What’s wrong with this scene?
A few things:
- Impact of technology—no matter what industry one is in we cannot hide away from the fact that tech is now all-pervasive and impacting our everyday life. Our smartphones, for example are in a manner of speaking, like appendages to our physical self. It has our appointments, our to-do lists, our daily reference data and, of course, our social media. Without it we are lost.
In taking stock and exploring growth opportunities understanding the impact and being able to visualise the opportunity technology can create is critical. It has significant financial impact and one that businesses need to recoup.
- Consumer behaviour—coupled with technology the (frequent) financial crises have affected how consumers now behave in their purchasing behaviour. Financial services are seeing an all-time low in the trust factor; the education sector is being disrupted bit by bit with new requirements of learning and knowledge; and brick & mortar retail is being overwhelmed by digital purchase.
- Culture— In my books culture is the most important element in ensuring successful execution of any business plan. It is rare to have the business planning discussions cover the culture aspect of an organization that’s in play. I’d like to state a distinction here between organizational climate and culture. Climate reflects state of satisfaction against a set of predetermined engagement parameters. Culture reflects the behaviour of the employees and is the image projected through the employees delivering their respective roles.
In planning sessions by leading in numerically what we are saying is that we do not value the ‘soft’ side or the non-data centric and emotional side of the business. Whilst the numbers may (and will end up) justifying the rational logic of the business target and tick off the necessary boxes; a huge void is left totally unaddressed.
The Soft Side Void
Approaching the business planning, as a process, creates this void where the soft side or the work culture aspect is totally missed. How to avoid this is content for another post.
Let’s see what happens when we do take the soft side into account and instead of making planning a process we look at it as an iteration of improvement i.e. what do we need to do better, in the coming year, than we did in the present year.
Addressing this soft side void involves getting the organizational leaders to agree on some key behavioural aspects in leading their respective teams. This creates an environment where employees willingly take ownership of the KPIs, as they are asked for their inputs on it and how to execute it.
Back to the Basics
Whatever is the type of business, at the end of the day, it’s the human interface that has a direct effect on the relationships a business forms with all its stakeholders. When we are able to create a culture of ownership (of organizational activities) at the individual level that is when we have line-of-sight to the value and importance of an individuals’ contribution to the organization.
One of the ways to undertake this is to get the people to understand the difference between having a fixed mind-set (often a result of years of experience and process working) and a growth mind-set (where opportunities are searched for through capability assessments).
Coming into planning from a growth mind-set then allows for looking at the activities from the perspective of improving them. This process then allows for judicious investment and return of investment and enables the organization to ensure long-term sustainability.