Strategic Planning As Learning Peter A.C. Smith President, The Leadership Alliance Inc. (www.tlainc.com) El Planemiento Estratégico como Aprendizaje Peter A.C. Smith Presidente, The Leadership Alliance Inc.
Summary: Describes the fundamentals of a “planning as learning” approach to strategic planning based on action learning, and the near- and long-term experience of a mid-sized company that has adopted this approach. Answers the question “How can a successful learning-based strategic planning approach be embedded in the business processes of an organization so that learning and planning go hand in hand naturally, on a daily basis?” Resumen: Describe los fundamentos del enfoque del planeamiento estratégico a la “planeación como aprendizaje” basada en aprendizaje acción y en la experiencia de corto y largo plazo de una empresa de tamaño medio que ha adoptado este enfoque. Responde a la pregunta ¿Cómo puede insertarse una estrategia exitosa de planeamiento basado en el aprendizaje en los procesos de negocios de una organización, de tal manera que aprendizaje y planeamiento vayan de la mano, día a día y de manera natural?
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Given the significant changes taking place in our global economy, the aims of strategic planning (SP) become ever more vital, and the challenges increasingly complex and risky. Unfortunately convenl tional approaches to SP are hopelessly out of date with regard to today‟s highly dynamic SP needs, particularly for mid-sized and small organizations. It had long been my opinion that the objectives of SP, or for that matter any significant planning, might be attained more effectively if viewed and implemented via a learning
paradigm. When I had the opportunity to participate in a SP assignment for a midsized publishing company (Company X) I was able to explore the feasibility of this concept and demonstrate its effectiveness. On the basis of this and similar assignments I am confident that it is feasible to embed a successful leaning based SP system in an organization‟s day-to-day business processes such that learning and planning go hand-in-hand naturally on a dynamic JIT basis. Post-implementation interviews designed to assess the degree of success of the case assignment are discussed.
The case involved the midsized Company X that was responsible for the national operations of an international organization headquartered in another country. Company X concentrated on marketing and distribution plus operation of a small manufacturing facility. Staff numbered about 500, including the President and an executive committee consisting of four functional-area executives and an executive assistant. Initially the President of Company X requested a meeting with me to explore how to ad-
dress a lack of strategic thinking and planning by the executives, including insensitivity to the rapidly changing conditions that the organization was facing. Company X used conventional SP, based on a formal, lengthy, and complex annual processes, carried out by the executives, essentially individually; however, this process had proven inappropriate for the dynamic competitive business in which Company X operated. Since I felt that Company X had operational autonomy; that the President would be a forceful sponsor of a new approach; and that the executive team that was small, I proposed that the firm explore an interactive learning-based SP process. Interactive planning is systemic, involving the organization‟s parts, the whole, and its environment, focusing on “making it happen” by facilitating learning and adapting, and by exploring and exploiting situations as they eventuate in dynamic fashion. The President had one proviso: the executives themselves must to have the capacity to transfer the SP capability to their managers, and then down through the organization in a cascading manner – consultant intervention would be limited to my one-off initial effort. The first step in introducing the new SP process was a 2-day introductory workshop that I and a colleague conducted for the President and the executive committee. This was the only direct consultant involvement in rolling-out the new SP process. The President began with an outline of the proposed SP approach, and its objectives of enhancing collaboration and crossfunctional awareness, eliminating endless discussion of functionrelated administrative minutiae, encouraging strategic thinking and planning, and enhancing under-
standing of the rapidly changing conditions in the many business sectors that the organization engaged in. There was unanimous (if nervous) support for the described new SP process. Next the executives undertook practical familiarization with the new SP process. This process was based on Action Learning plus a number of techniques and tools to ensure that issues addressed were driven by strategic business imperatives and targeted to achieve the right business outcomes. I recommended that the executives and their reports adopt a less formal approach to action learning than is traditionally practiced. Participants were introduced to two tools to promote reflection and facilitate strategic dialog. The first was PEST (Political, Social, Economic, Technical) Analysis, intended to develop a crossfunctional systemic understanding of where the business as a whole, and its various functional areas, were headed, and to highlight organizational implications. SWOT (Strength, Weakness, Opportunity, Threat) Analysis was then introduced, where the contextual information from PEST was considered in more strategic terms. Action learning ensured that these tools were applied in an interactive planning manner and the sharing of views cross-functionally was very helpful, both to learning, and to reaching consensus. Finally, a Master Analysis Grid was compiled. This was a matrix showing urgency and priority versus strategic issues. Participants next became familiar “by doing” with the strategic planning framework shown in Figures 1. This framework provided a systemic strategic foundation for the participants‟ planning. This same
framing was later applied by reporting managers in a cascading manner. Outcomes and activities discerned through the SP framework were next explored using the outcomes-driven performance system presented in the heart of Figure 2. The system helped participants focus on key issues and facilitated reflection and dialog by providing a simplifying „language‟ based on three systemic business drivers with which to explore performance potential. In the workshop, participants had defined the desired strategic outcomes then worked back to examine whether the necessary “ideal” Focus, Will and Capability existed in the organization or whether they needed to plan to provide them. As actual performance deviated from optimum and outcomes were not fully achieved, the planners learned by comparing actual to anticipated results, and by dynamic tuning of the three performance fields, to try to improve performance. As shown in Figure 2, this tuning and learning was greatly facilitated through the collaborative learning central to action learning. After the workshop, no further consultant effort was provided. Over the next two months the executive team met a number of times to define clearly the strategic outcomes to be achieved. Once consensus was reached, functional meetings were held. These were led by each executive with his/her own reports. The same meeting process was followed by the executives in helping their reports to focus on functional matters in support of, and aligned with, the executive group‟s strategic agendas. Two years after the original workshop, interviews to elicit feedback on the workshop and the overall SP approach were held. Company X had at this point taken owner-
ship of the process and the previously used conventional system had been phased out. Planning terms and language had been standardized to establish a common meaning for all the planning participants. Flow diagrams to clarify the process and scheduling of executive committee meetings had been developed. These included cascading planning to the functional managers, and iteration between the executive committee and the functional teams. Action learning (self-facilitated) was still the basis of meetings. The SP framework introduced to the organization promoted an emphasis on customer outcomes as business drivers, and promoted a shared responsibility for entrepreneurial attitudes and behaviors to attain customer value. Setting of priorities particularly enhanced the efficiency of support functions. Further, the solutions that emerged from this process were based on both generative and adaptive learning that when implemented allowed further learning to take place.
Cascading planning down to the reports was considered relatively easy by the executives, and worked best when the reports formed an action learning group and the appropriate executive facilitated. Having the executives take personal responsibility for rolling out the cascading process was considered a key factor in the success of this initiative. It was noted that where an executive had anxiety about the process, the rollout did not go as smoothly. In such cases it was important that the executive “last the course”, and in all such instances the managers and their executive worked through their problems and were able to finally fully participate in the process. The cascading process was reported to have stimulated the formation of learning networks that created solid and sustainable bases for the development of new SP structures and collaborative cultures across the organization, including x-functional teams concentrating on specific projects e.g. new patterns of continuous improvement. The use of action
learning at all levels of the organization in the cascading planning process was said to have promoted awareness of the range of mindsets, experience, and priorities by its open supportive nature, its practical exploratory focus, and through the inclusive sharing of knowledge. Action learning by its nature fostered readiness to explore the assumptions of the various group participants, and through dialog, they entertained implementation of novel solutions. The President and the executives universally regarded the new SP approach as extremely useful and the results as excellent. Benefits envisioned by the President from a sound strategic planning effort had been realized and there was excitement and satisfaction among the executives and their reporting managers. The whole new SP process had continued to work smoothly, and it was noteworthy that according to the President, Company X‟s ability to contribute meaningfully to their headquarters‟ strategic plans had actually improved.
(F) COLLABORATIVE LEARNING AND PLANNING TO SHARE MEANING ‘MOVES’ CIRCLE
ACTION LEARNING
WORKPLACE FOCUS
FEEDBACK TO (F), (W), & (C)
Performance Definition & Understanding What?How?Why?Who?Where?When?
COULD ACT
WOULD ACT
PERFORMANCE
WILL ACT
CAPABILITY Competencies; Wherewithal, Infrastructure
(C) COLLABORATIVE LEARNING AND PLANNING TO PROCURE RESOURCES ‘MOVES’ CIRCLE
WILL MAY ACT
Attitudes; Emotions; Beliefs
OTHER INFLUENCES
(W) COLLABORATIVE LEARNING AND PLANNING TO BUILD RELATIONSHIPS ‘MOVES’ CIRCLE
OUTCOMES