At LRI, we have always thought about strategic planning from the perspective of change. The strategic planning process is important because it aligns people’s understanding of what the organization is trying to accomplish and what its priorities are. It’s the starting point for real, meaningful change to occur. The other value of a strategic planning process is that it results in a written strategic plan that people can use like a playbook. Having that “playbook” enables people in the organization to be well-coordinated in what they’re doing, why they’re doing it, when they’re doing it, and how they’re doing it.
First, from a content perspective, we see more focus now on resiliency and adaptability. The pandemic woke up people to say: “How can we be better prepared for the unexpected?” Leaders want to build an organization that can survive the changes they can’t predict. In strategic planning terms, that’s an adaptive strategic context. There’s more focus on what’s needed to build a resilient, adaptable organization.
Second, there’s a sense that the term “strategic planning” is outdated. One of our consultants said to me recently: “I’m not sure we should even call it strategic planning any longer. The word has become tired. We should find a different name for it because it’s still important.” She was not arguing to do away with the process or the plan, but she was arguing to reframe it. Even the word strategy, she said, is a word that sails over people’s heads and doesn’t really mean anything until you translate it.
I suggested using the term “beta planning.” In financial markets, people talk about “beta” as a competitive edge. It’s the investments in people, processes, and technology that distinguishes one company from another and results in higher levels of performance. And the heart of good strategy is finding your organization’s “beta”– the secret sauce that will enable your organization to stand apart, to succeed despite challenges.
In thinking about this further, I realized that beta planning was not just a different spin on strategic planning. It also carried with it a different emphasis. In strategic planning, we typically focus on what results we want to achieve. As we sharpen the focus on different time frames, those results become the framework of goals and objectives in the strategic plan. Results, in short, are the lens through which we envision the future state of the organization.
In beta planning, we still start with defining the desired results. But then our focus shifts to: What are the capacities we need to achieve them? How do we build those capacities? How do we systematize those capacities? And assure their continuity? Capacities are the lens through which we envision the future. Traditional strategic planning asked where are we going and why – and how will we measure our success? Traditional planning assesses the organization’s success by what it accomplishes. Beta planning asks where are we going and what capacities do we need? Beta planning assesses success by what capacities the organization builds.
Almost by definition, capacities are harder to measure than accomplishments. How do I know we have the capacity to adapt quickly? How do I know we have the ability to build effective partnerships or recruit qualified talent? How do I know we oversee the performance of our vendors effectively?
One way would be to measure it on an individual basis. Does a given leader have the ability to respond to the unexpected effectively? Or to hold vendors accountable? The aggregate of those measurements may tell us something. But I’m not sure that it tells us whether the organization possesses the capacity. The ultimate measure of success is knowing that the practices, processes, and systems needed to maintain a given capacity are in place.
In this vein, I think about tabletop exercises. In a tabletop exercise, you imagine a scenario and imagine how you will respond. It could be dealing with a loss of revenue. Or choosing from a pool of seemingly qualified candidates. It could be building an effective team while working remotely. The value is in providing your organization’s leaders with real scenarios so they can learn to anticipate and respond effectively in a given scenario. And through those exercises, they can determine what systems, processes, and tools they need to sustain the capacity.
In conclusion, I would offer a final thought. People need to be aligned in where the organization is going and why – and how it will get there. The difference between “beta planning” and traditional strategic planning is a matter of emphasis. The planning remains important – and the importance of it has never been greater.
Next blog: “Three Strategic Planning Questions That Everyone Should Ask”
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