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The best companies are already starting their Annual Strategic Planning process for 2023. They're engaging in pre-planning activities like budgeting, brainstorming, gathering data and insights, and scheduling time for the team to hash out any major decisions. We don't have a crystal ball, but we can be confident that the year ahead will hold plenty of uncertainty as there are so many factors outside of our control - what will happen with the economy, the war in Ukraine, new COVID-19 variants, supply chain shortages, workplace trends like remote/hybrid work, employee turnover, etc.
While we cannot predict the future, we can prepare well with a solid plan. One of the many advantages of starting your strategic planning process early is that you have time to think creatively and generate more possibilities to choose from. Companies often get locked into false dichotomies - should we acquire this company or not, should we hire this executive or not, should we build this new feature or launch this new product line or not? This kind of thinking puts blinders on the decision-making process.
Widening your pool of options to consider will result in a much better decision for your company's future, but when you're in the heat of the strategic planning session, listening or debating all the reasons for or against a particular decision, it's very hard to step back and say, "what if we used those resources to do something else entirely?"
Don't fall into the trap of using your strategic planning session with your team as an exercise to "bless" what you've already decided ("Bring me the data that confirms my idea is the way to go!") or to debate endlessly over whether or not to do one thing in particular. Widen your pool of possibilities by engaging your team in a Think Rhythm prior to your planning session, where you'll actually make the decisions.
Generate more possibilities for your business strategy.
How do you actually generate more possibilities for your business strategy? Here are some great thought exercises to try with your team that I've adapted from Chip and Dan Heath's great book Decisive: How to Make Better Decisions in Life and Work:
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If we waved a magic wand and suddenly we could NOT do any of the options we've identified up to this point, what would we do instead?
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If we were replaced today by a new team of top executives, what's the first thing they would do? What's stopping us from doing the same thing?
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If you were in your CEO forum or other professional group and one of your peers described the same business challenge you are having, what advice would you offer?
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How can we do something small to test our ideas before we invest? (As Jim Collins says, fire bullets before cannonballs.)
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Who has already solved this problem or achieved this goal? What can you learn from them?
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Are there any useful analogies you can apply? What can you learn from other industries, disciplines, or leaders?
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If we zoom to the future and we are celebrating a year from now, what have we done to achieve that success? (This is the Destination Postcard exercise our consultants encourage clients to do in their Annual Planning process.)
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If we zoom to the future and we have failed miserably a year from now, what has gone wrong? How can we protect ourselves from these potential pitfalls?
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If we are wildly successful with our idea, what could go wrong that we should plan for? (Think supply chain issues, operational challenges, etc.)
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If we fail spectacularly, what's Plan B? What is a leading indicator that we can use to know if we are on track for failure? What's the threshold for shifting to Plan B to mitigate the damage? (Think of setting a tripwire to get an early alert that you need to change course.)
Hopefully, using these questions and thought experiments can help you and your team consider multiple strategic options and anticipate opportunities and threats that may otherwise have blindsided you. Once you've generated a pool of possible strategies, you can narrow them down using an objective framework (we recommend ranking ideas by revenue impact and ability to execute) and test your assumptions. Explore multiple ideas simultaneously if you can to avoid getting locked into a losing strategy.
As you head into budgeting and planning season, consider this insight from the Heath brothers - Companies who pursued both "prevention" and "promotion" mindsets outperformed other companies in the last recession.
So if you're looking to make budget cuts ahead of a potential economic downturn, don't just think about avoiding negative outcomes; also, find ways to explore positive opportunities. Can you make additional cuts so you can invest in growth? Can you avoid layoffs and re-allocate those resources to a more profitable endeavor?
Use Rhythm Software to move seamlessly from strategic planning to execution.
If you decide to engage in these pre-planning activities, you can use the Rhythm software to create Idea Boards in your Annual Planning Meeting to prompt the team to brainstorm ideas asynchronously and keep all your prep work organized in one place. When you do eventually decide which ideas to execute, you can convert them from an Idea to a Goal with just a click to seamlessly move from strategic planning to execution.
Check out our software tool to see how we support a robust planning process to make the best possible business decisions.