Why Planning Fails In Middle Sized Enterprises
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Why Planning Fails In Middle Sized Enterprises

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Most strategic plans fail to deliver their goals because there is insufficient attention by ...

Most strategic plans fail to deliver their goals because there is insufficient attention by
the leadership team on the management of strategic change.

For most middle-sized enterprises the risk is high because:
· they develop a strategic plan in response to a threat, a "reinvention strategy;"
and,
· they do not have deliberate, effective change management processes in place.

CEOs can greatly increase the chance of success of strategic change initiatives, even
those induced by anxiety or shock, by appointing a Change Leadership Teams, and at
the same time by paying serious attention to using vision, mission and values statements
as implementation tools.

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Why Planning Fails In Middle Sized Enterprises Why Planning Fails In Middle Sized Enterprises Presentation Transcript

  • Why Planning Fails in Middle-sized Enterprises by Walter Adamson Most strategic plans fail to deliver their goals because there is insufficient attention by the leadership team on the management of strategic change. For most middle-sized enterprises the risk is high because: they develop a strategic plan in response to a threat, a quot;reinvention strategy;quot; · and, they do not have deliberate, effective change management processes in place. · CEOs can greatly increase the chance of success of strategic change initiatives, even those induced by anxiety or shock, by appointing a Change Leadership Teams, and at the same time by paying serious attention to using vision, mission and values statements as implementation tools. Keywords: SME; middle-sized enterprise; strategic change leadership; values. Walter Adamson Founder and Principal Digital Investor Pty Ltd www.digitalinvestor.com.au adamson@digitalinvestor.com.au +61 403 345 632 As published in Strategic Direction Volume 20 Number 10 2004 pp2-4 Strategic Direction is a publication of Emerald Group Publishing Ltd Its mission is to provide chief executives with concise, action-oriented applications of current experience and thinking on business strategy. www.managementfirst.com adamson@digitalinvestor.com.au 1
  • Why Planning Fails in Middle-sized Enterprises by Walter Adamson Most plans fail Most strategic plans fail to deliver their goals because there is insufficient attention by the leadership team on the management of strategic change.For most middle-sized enterprises the risk is high because: they develop a strategic plan in response to a threat, a quot;reinvention strategy;quot; · and, they do not have deliberate, effective change management processes in place. · My rule for the best possible chance of success is for the CEO to establish a Strategic Change Leadership Team to guide the implementation of the strategic plan. The role of the Strategic Change Leadership Team The Strategic Change Leadership Team needs to be focused on the implementation of each element of the Strategic Plan. It is responsible for appointing sub-groups to carry out specific tasks and assignments. The Team reports to the CEO or the Board and must hold itself responsible for setting the program and meeting the implementation targets. In this way it becomes the creator and overseer of the quot;program officequot; for the implementation of the strategic plan. Part of the Team's early role is to not only set out the program as a set of projects but also to seek to clearly link the implementation activities to business benefits. These benefits should be apparent from the Strategic Plan - but this doesn’t mean that mapping the benefits to particular projects is easy. Nonetheless, this mapping work is an important initial job for the Strategic Change Leadership Team. adamson@digitalinvestor.com.au 2
  • Why Planning Fails in Middle-sized Enterprises by Walter Adamson It is also highly desirable that the Team plan a series of pilot and mini-projects which are aimed at delivering the business benefits of the change program. By seeing through these mini-projects the risks and unknowns of the larger project will come to be better understood. Then, the plan can be adjusted against those outcomes in a cycle of continuous improvement and pro-active risk management. First actions for the CEO The CEO should appoint the Strategic Change Leadership Team. They should assign the Team to directly manage the most critical actions from the Strategic Plan, or as an alternative have task-groups appointed to overview specific tasks. All the Team members do not have to permanent; they might come and go according to the type of change being led. For example, changes to a specific business unit or market may require a particular specialist, changes to channels may require another and changes to recruitment strategies another - perhaps including outside experts. A key requirement for success is that the Team has to have senior leadership heavily committed to it and to the implementation of the strategic plan. One excellent way to demonstrate this commitment is by appointing a senior executive to lead each sub-team e.g. a strategic reinvention sub-team for a particular market or geography. Vision, mission, and values statements as implementation tools To further reduce the risk of failure during the implementation of change CEOs should consider more seriously the role of vision, mission and values statements. adamson@digitalinvestor.com.au 3
  • Why Planning Fails in Middle-sized Enterprises by Walter Adamson Successful entrepreneurs running middle-sized companies very often question the practical value of vision/mission/value statements. On the other hand many other entrepreneurs build their companies around strong values and vision, and they clearly create shareholder wealth from that fabric. Therefore the doubts of one set of entrepreneurs contrasts with the behaviours of the other entrepreneurs who act out their values and vision. What is apparent is this: where there are shared values which are integrated into the organisation, whether explicit or implicit, then powerful outcomes can be achieved. In times of change, and when implementing change, there is a need for CEOs to be explicit, to write down and discuss what before may have been implicit. How is this to be done? Producing statements of values, mission and vision is a beginning, but some would say the easy part. The action and wealth creation comes from their implementation. Beware offering false hope Paradoxically, the production of a quot;values statementquot; with no further implementation program can lead to skepticism and diminution of organizational capability. What this means is that as a CEO you are better not to embark on this journey if you do not intend to follow it through to conclusion. Producing a values statement but not living it or quot;walking the talkquot; will lead to a negative impact on strategic change. If you and your leadership team do not give attention to deployment, to living the values, to benchmarking and improvement, then in times of change your staff will rapidly dismiss the statement of values as a meaningless gesture, perhaps quot;another fadquot;. adamson@digitalinvestor.com.au 4
  • Why Planning Fails in Middle-sized Enterprises by Walter Adamson However, when created and deployed in the right way vision, mission and values statements can be leveraged, and by doing so, in my opinion, CEOs will: 1. significantly help shape and focus their organization; and, 2. create a perceived natural worth around the statements; and, 3. ultimately deliver extra shareholder and employee value. Actions to leverage values statements use the vision/mission/values statements as a template for all items and actions · that come before you, and the Leadership Team, for decision; Most importantly use them in discussions of issues and decisions with leaders at · all levels and with all staff. Let them be used in daily life! Encourage, or at least don't be defensive, if people challenge the words and · meaning. Help them understand the meaning through discussion. The real value is in the discussion not in the words on paper. It is important to maintain the objectives without too much change but be open to changing the words if it helps ease confusion. In fact I would go as far as to say to encourage your people to challenge the statements - because in that way they will become committed by seeing you and your leaders being involved and passionate about their meaning. Forsake the ritual for meaning; Encourage and demonstrate the use of the statements as a guide in meetings with · all divisions and business units of your organisation. Judge and decide on actions by reference to the statements and in particular where difficult and strategic choices have to be made; adamson@digitalinvestor.com.au 5
  • Why Planning Fails in Middle-sized Enterprises by Walter Adamson Have those reporting to you formally report on how they are developing and · implementing strategies based on the statements - on a regular basis; Benchmark each and every value, and put improvement programs in place to · take the values forward and to integrate behaviours across the organisation. The benchmark results and the design of interventions must be a regular agenda item of each leadership team meeting; Assess individual and collective behaviors regularly to ensure that they are in · line with the espoused values (including your own behavior). Are we meeting our values today? Lastly, when walking the floor ask people not: “Are we making money today,” but: “Are we meeting our values today?” (“And by the way can you please tell me if I and the leadership team are meeting your understanding of our values?”) Conclusion CEOs can greatly increase the chance of success of strategic change initiatives, even those induced by anxiety or shock, by appointing a Change Leadership Teams, and at the same time by paying serious attention to using vision, mission and values statements as implementation tools. adamson@digitalinvestor.com.au 6