The Secrets of Strategic Planning No One Discusses #4: The Role of Senior Managers in Strategic Planning

The head of planning of a leading overseas bank came to one of my international Transformative Strategic Planning® seminars—and I never heard from him after the seminar. The VP of the consumer banking division of the same bank came to my seminar the following year. In a private conversation, the VP said to me, “Our head of planning came to your seminar last year, right? Why didn’t he share these ideas with the rest of our management team?” Of course, I mentioned that I did not know the reason why he did not. Nevertheless, I ended up consulting with them. The point here is that the bank would never have learned about any of the ideas I presented in my seminar if the VP had not attended. They did not know that their head of planning was more of a “gatekeeper” than an “explorer” (see “Secret Number 2”).

The heads of strategic planning in companies and the consultants in strategic planning come from many types of disciplines and bring their biases and strengths. Each actor will unconsciously assign more value to issues related to their discipline (because they know it) at the expense of value assigned to other functional areas. That can bias the strategic plan. Also, many senior management teams expect a document that explains what the best strategic planning for them is without much participation or people in their company. Sometimes, even managers favor this strategy because doing strategic planning requires hard thinking, and without a rigorous and effective methodology, the process can be very cumbersome and ineffective. They are ignoring their main responsibility. Doing strategic planning that way has four or more very important drawbacks.

1. Creating those plans may not have fully taken advantage of the collective knowledge of the organization. Some very important issues for different managers may be ignored, setting the plan up for a lack of support.

2. Senior managers and employees will see only the result of a very complex and highly conceptual process, including many discussions and questions, different ideas, assumptions, opinions, and arguments for and against the ideas that end up in the plan.

3. Since the senior management team and many others have not had the opportunity to go through that process, they find that many of their ideas and concerns are not reflected in the plan and naturally will not be excited with the plan.

4. They may not fully understand where many things come from. Distrust—and even fear—spreads, and managers and employees are skeptical at best or fight the plan.

These ideas are very important reasons why many strategic plans do not work very well in business organizations. Senior management needs to know what they can expect from their strategic planning.

For the reasons discussed, I propose that a “fundamental principle” should be applied to strategic planning. This principle says that “the strategy of an organization is the primary responsibility of the entire management team and should not be delegated to either an outside consultant or to any given person or function within the organization.” Heads of planning and consultants can help, but senior managers have the ultimate responsibility. They have to be up to date with the different options and methodologies available for strategic planning managers. That means they need to attend seminars, conventions, and networking events in strategic planning and read books and articles that can give a broad understanding of the strategic planning field. They need to be aware that there is no standard strategic planning and that the industry is fragmented, evolving, diverse, and lacks checks and balances.

The evaluation of the head of planning and the planning process should also be a critical concern of the senior management team. There is a big gap in time between the formulation and approval of a strategic plan and the concrete results of the plan. It makes sense to evaluate the rigor and effectiveness of the strategic planning process they are using and not wait for the results because, at this point, the damage is already done. There may be several instruments that can be used, but managers must be sure that those instruments are rigorous and reliable. That means serious assessment of the instruments that you are planning to use. A simple but very powerful indicator will be to realize that a good strategic planning process should unify the management team and ideally the entire organization, help managers to achieve consensus, generate commitment, create excitement, and inspire the management team in a way that allows them to develop a strong sense of urgency and self-confidence to take on the future. If you do not have all of these, you do not have a good planning process.

About Luis Flores