Avoiding Strategic Planning Pitfalls

In today's episode, our hosts Brenton Gowland and Ron Tomlian talk about the pitfalls to avoid in strategic planning.

The pitfalls covered are: 

• Failing to make a plan
• Not having your people aligned with the plan
• Thinking you are the best person to facilitate the strategic plan
• Failing to build the strategy into the day to day of your business
• Having unrealistic expectations in your strategic plan
• Not involving the right people in your strategic planning
• Having a strategic plan that does not stretch you enough
• Not frequently reviewing your strategic plan

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SA Business Builders
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Transcript

Brenton Gowland: 0:00

Today on The Business Builders podcast, we're talking about the pitfalls of strategic planning in a follow up to our demystifying Strategic Planning series. Ron talks about structuring your business to align your staff to be able to deliver your strategic plan. And I talk about the importance of making sure that your strategic plan stretches you but is still achievable. Well, welcome to the Business Builders podcast. We are your hosts, I am Brenton Gowland.

Ron Tomlian: 0:26

And I'm Ron

Brenton Gowland: 0:27

And Ron, we've Tomlian. just finished a series on demystifying strategic planning. And so in a week's time, well, you know, next episode, obviously, these run fortnightly, we're going to interview a CEO from a company who was very good at putting strategy in the practice. So we're going to talk with that person about how they've gone about it, what were the pitfalls, what were the things to look out for, and how he'd actually implemented change. And in our discussion that kind of brought us to the fact of maybe we should just talk about pitfalls before that person comes in for their interview next week, so that we can kind of bridge the gap between the actual strategic planning and the implementation part. Yes?

Ron Tomlian: 1:05

Yeah, absolutely. And going back to our original format of talking about our tips and tricks.

Brenton Gowland: 1:10

Yeah, right back to Episode One. That's 19 episodes ago today, isn't it?

Ron Tomlian: 1:15

Fantastic, isn't it.

Brenton Gowland: 1:16

So next episode is our 20th episode, we're starting to get into milestone territory and we're still running fortnightly.

Ron Tomlian: 1:21

And what's been happening for you, Brentan?

Brenton Gowland: 1:23

Well, we've had a month packed with public holidays here in Australia, which is always interesting to navigate when you're running your own business, because I've had to rearrange when I work this month to fit in with the holidays.

Ron Tomlian: 1:34

It's funny people who are employees love April, because of all the public holidays, employers hate April for this very same reason. It just disrupts everything.

Brenton Gowland: 1:44

It absolutely does. And then you're paying for all these holidays. And you're not necessarily having projects get out the door on time, because you've got hold ups and it's public holidays are problems for employers generally.

Ron Tomlian: 1:56

Yeah, for business in general. But you know, it's different perspectives for from different people, so.

Brenton Gowland: 2:01

Exactly. Employees love it. And that has some value, doesn't it?

Ron Tomlian: 2:05

Yeah, yeah. Keeps them fresh, I suppose.

Brenton Gowland: 2:06

Cool. So that's our format. For today, we're going to look at the pitfalls of demystifying strategic planning but before we get into it, we've got our sponsors to talk about.

Ron Tomlian: 2:17

SA Business Builders. Yes, and Adapt_CO.

Brenton Gowland: 2:19

Yes, indeed, SA Business Builders is a network of business professionals that we get together. And we focus on developing strong business relationships. So it's all about the relationships, because we know that work comes from good relationships. It's not about the selling, it's about getting to know and support each other. That's you. That is me and exciting news. Within a month, I will have my website up and running. So it's only taken a year. But I'm excited to say that that will be in the pipeline for May.

Ron Tomlian: 2:49

Fantastic. Hopefully you do things quicker for your clients than you do for yourself.

Brenton Gowland: 2:53

Well, actually, that's the point because I've been doing a bunch of stuff for my clients, different projects, and so forth. So I haven't had the time to get to it. And sometimes though, it takes a little bit of time to work out, well, what am I going to present as we've been going through with the whole strategic planning, kind of...

Ron Tomlian: 3:08

Get your objectives

Brenton Gowland: 3:09

I know so I in order. gotta, I gotta actually follow our own advice. Well you are my mentor. So this is a public display of this is how this relationship works. Okay, so that's our sponsors. And let's get into the topic. So why should we think about pitfalls when it comes to strategic planning?

Ron Tomlian: 3:30

Because there's no better learning experience than somebody else's experience. We don't have to go through all the pitfalls ourselves, we can get the benefit of what other people think and what they've done. So I've got some pitfalls that I've seen in what people have done in strategic planning what I've done in strategic planning, and I hope that by hearing them, the people who are listening won't necessarily have to go through those pitfalls themselves.

Brenton Gowland: 3:55

Correct. And I guess the real focus of why we're looking at pitfalls is to make sure that we can get to the part where we implement because the biggest challenge that we've been talking about from doing a strategic plan is actually then getting to the point where you can implement a strategic plan. And it's often a big change piece within an organisation depending on what the plan is. But how do you get that into action? And so the pitfalls we're talking about today are the things that have stopped people putting it into action. Yes?

Ron Tomlian: 4:23

Yeah. Well, I think the number one thing I've seen, and a problem with strategic planning is firstly, not doing it. And secondly, not doing anything with it once you've got it. And that's, that's the implementation piece. And that's hard work. And there's a reason that it's hard work. And that's because it's not the day to day, it's not the norm, you're actually talking about how you're going to change the way you do things and change can be uncomfortable. So implementing strategic plans are difficult. And the biggest difficulty in their implementation that I've seen is finding the time and getting the resources to actually make the changes that you need to make.

Brenton Gowland: 5:00

Yeah as you've talked about in the past, actually finding the headspace because it's not just the time it's getting away and being able to think about your business in a strategic sense. And we've, look, we've talked about that in the last five episodes. But you raise an interesting point, because it's the two core problems like that you spoke about, we're not doing a strategic plan, and you run from meeting to meeting to meeting to meeting and just check off the same old, same old every time, but you're kind of just treading water. And I can't remember who said it. But there's that saying about, if you're not moving forward, you're basically moving backwards. And I've been in businesses where that's happened, where you've, you've failed to have a plan, and you just kind of tread water, and then all the elements around you just catch up with you and sometimes can trip you up in a real big way. So it's very important to actually get the strategic plan done as a first step.

Ron Tomlian: 5:47

But then acknowledge that once you've got the plan done, you need to do something with it. And that needs to permeate down to what everyone in the organisation is aligned to doing. So I suppose the second is alignment, not having people aligned to the plan. And that gets right down to what people are doing. So we're talking some something like 30 years ago, the McKinsey organisation had the Seven S structure and the first S was strategy. The second S was structure. And we're they're talking about structure of the organisation. And what they they used to emphasise over and over again, is you can't have a structure to an organisation until you develop the strategy for moving forward. Because structure will be, is dependent, on what the strategy of the organisation is. So that gets down to how you structured the resources, the people resources in your organisation. What makes sense, given what you're trying to achieve. So everyone's responsibility, duties should be aligned to what are we trying to achieve in the strategic plan. That goes to the why as well, that we talked about last week.

Brenton Gowland: 6:51

So the first one is that we've got to get the plan done. So not doing the plan is a problem. The second one was what was it?

Ron Tomlian: 6:58

Alignment.

Brenton Gowland: 6:58

Alignment. That's right.

Ron Tomlian: 7:00

Yeah, the structure has to follow the strategy of the organisation. And that means having people in positions that are aligned to what you're trying to achieve in your strategic plan.

Brenton Gowland: 7:10

Okay, so if we paraphrase, it's just do it, and then align everyone with a plan. So what are your other pitfalls that you are thinking about with strategic planning?

Ron Tomlian: 7:18

I've seen one of the biggest pitfalls, especially for business owners, or CEOs and organisations is understanding that we need to do a strategic plan. And I'm the best one to make this happen. So I will undertake the process with my team. And I'll run it. And what I've seen is that that can be problematic. Now another great one for saying you always have to bring in somebody from outside but having someone help you facilitate the process of planning, not the content, but the process of planning can be advantageous. And the reason I say that is because it can be seen to be an independent, objective process. If someone else is running it. I'll tell you a story about my own experience. I was running an organisation as CEO, and we needed to do some strategic planning very quickly, there wasn't enough time I thought to bring someone else in. So I ran the process. I've done it before within organisations, I ran the process of the strategic plan. And within a year, it was quite successful. Within a year, we knew that the environment has changed significantly, and we needed to change it. So I said to the team, okay, guys, let's say let's get our act together and reform the group that was developing the plan. And my leadership team said to me, you just got to do it yourself. I said, What do you mean? They said, Well, that's what you did last time.

Brenton Gowland: 8:40

So you set a pattern?

Ron Tomlian: 8:43

ideas rather than my own. They perceived that because I was doing the writing. I was just writing it the way I wanted it to be done. And they said, Yes, you go off and do it. That's what you did last time. So I brought someone else in the next time to facilitate the whole process. I don't think they did as good a job as I did. But the truth of the matter is, as a result of that they own the plan rather than being seen as my plan. So there's there's an importance to not only doing the right thing, but being seen to do the right thing. Yep. And that's a theme that I've used a number of times in this podcast. And that means using someone outside to make sure if you like the process is seen as fair, that is not you dominating as a business owner or CEO dominating the process.

Brenton Gowland: 9:34

Look, I gotta say, when I've been running businesses and so forth, and there's been a few that I've been involved with running, I would swear by getting someone in from the outside because you need someone to help you unlock those thoughts that are already in you or you need someone to help you facilitate because it just it's another way of getting you in the right headspace. If you are doing it all yourself, sometimes that doesn't give you the freedom of thought that you really need. So I really advocate for bringing people in.

Ron Tomlian: 10:02

Yeah, thank you. It's very difficult to facilitate and be thinking about content at the same time. And what I mean by that is, if you're running the process, you're concerned about the process in dotting the I's and crossing the t's, you're not thinking so much about what's being said, because you're developing or you're documenting what's being said. So it's a very different skill set. And it's a very different headspace. And to try to do both at the same time, I think is fraught with danger.

Brenton Gowland: 10:29

Yep. So our tips so far are like we said earlier is getting it done in the first place, because I know a lot of people also that start strategic plans, and then don't know where to go with them. Its alignment, getting your staff to align. And then of course, what we just spoke about, then was getting outside help. Yep.

Ron Tomlian: 10:44

Brenton, I've done three.

Brenton Gowland: 10:45

Ah, are you throwing it to me now?

Ron Tomlian: 10:47

Yeah I'm throwing it to you.

Brenton Gowland: 10:48

Passing me the conch, well there you go. There's a few things to think about, in my view, with pitfalls with strategic planning. And the biggest pitfall that I've come across kind of marries up with your alignment, kind of pitfall that you're bringing in. And that is not building the strategic plan into the day to days of the business. And what I mean by that is going right back to people's job descriptions, actually going through the strategic plan and developing individual KPIs for your staff that they can be measured against. And often, depending on the shape and size of the company, those KPIs might go down as far as managers, but it might not go down to frontline staff necessarily, because they've got their jobs to do. And it's the managers who direct them. But really KPI'ing people in a way that aligns with delivering on the strategic plan's objectives, is a very good way of starting to really bring focus to what needs to be done, because then everyone's looking at what needs to be done. Because let's be frank, as we were discussing earlier, strategic planning, to implement that, it is literally a change piece. And a change piece takes time and focus. So you've got to get every person that needs to, to be focused on where you're going. And the way to do that, in my view, is to bring it right down to individual KPIs.

Ron Tomlian: 12:02

And another way of putting that is, and I've seen the problems with not doing this, is making everyone in some way accountable for achieving the plan.

Brenton Gowland: 12:11

Yep.

Ron Tomlian: 12:11

And that's what what KPIs are all about. Giving some measure to the accountability that everyone has a part to play.

Brenton Gowland: 12:18

And that is where the hard work comes. So when you've done the plan, and as we spoke about through our demystifying Strategic Planning series, the plan in a sense can be the fun bit, even though it's work because you're dreaming, and you're you're strategizing, and you're coming up with what needs to be done. And there's a saying an idea is cheap, actually putting it into practice is hard work. And so this is almost like putting those ideas into practice, this is where the rubber meets the road.

Ron Tomlian: 12:42

Absolutely. And that's the hard part of the plan and staying, staying on track. Staying disciplined, again, very difficult thing to do. If you think about our people's own experience in trying to achieve something for themselves, whether it's becoming good at a particular skill, or weight loss or whatever, it's about sticking to the discipline that you know needs to be done.

Brenton Gowland: 13:03

Correct.

Ron Tomlian: 13:03

And that's hard work.

Brenton Gowland: 13:04

And that way, you have to direct everything back to the plan and KPI it and so forth. When people go to lose weight, they might download one of those apps that's a calorie counter, etc, etc.

Ron Tomlian: 13:14

Yeah, exactly.

Brenton Gowland: 13:15

I mean, you mentioned an app to me I never heard of earlier, we won't advertise them, but there's a dozen of them around. But it's the same thing with KPIs. It's like having a dashboard for your progress. And so that you can actually, and I think that discipline comment you've just made is very good, because it builds discipline within you. If you've got those measures in place to go now, am I doing what needs to be done to get to where we're going?

Ron Tomlian: 13:38

Yeah, so that's number one, number two?

Brenton Gowland: 13:40

Number two, and number two and number three for me are pretty aligned. And that comes down to the nature of the strategic plan, because I find that sometimes people can put a really unrealistic expectation on people through their strategic plan. Let's say we're turning over $5 million, and we want to go to $10 million in one year, right? Or within three might be a bit more realistic. But let's say it's one year that they want to...

Ron Tomlian: 14:05

Yeah they want to double.

Brenton Gowland: 14:06

Yeah, and some sometimes there can be that ambition there, but it's too unrealistic for staff, you know, people, if you're going to do a change piece, you got to see that you can get to where you're going. And if it's a $10 million growth plan, instead of it being a year maybe it's maybe it's five years, maybe it's three years depends on the business, maybe 10 million is achievable. But what I'm saying is, if you put unachievable expectations on people, it makes them not just lose focus, but it makes them lose their passion, because they just know it can't be done just intrinsically on the inside. How many times have you heard from people that they've been let's say they're in sales and they got to achieve a certain figure and they know it's impossible and they just lose their steam start looking for other jobs. So developing an unrealistic plan is a massive pitfall has got it and that's why sometimes getting that external person in to help you is so damn important. Because you need to have a measuring rod and go hang on minute, is that actually going to be able to happen.

Ron Tomlian: 15:02

And I think that I'm going to sneak another one in here. What I've seen in organisations is they don't involve enough or the right sort of people into the development of the plan so that you get unrealistic expectations happening because they're involved in the plan. And there's all sorts of enthusiasm. And then all of a sudden, you realise it can't happen involving more people or people who have a realistic expectation of what what can be achieved in the organisation is so important to making sure the plan that you develop is one that people can actually implement.

Brenton Gowland: 15:35

Yeah, 100%. And my other pitfall is having a plan that's not stretching enough. If you have a plan that's like, well, basically can be continuing business, as usual. Well, why would anyone give it any attention, but I come back to the comment I made at the start of this podcast is, if you're treading water, you're not moving forward. So sometimes plans can just be not really giving people the motivation they need to really take the business forward. And I think that's a big, a big pitfall in today's world, because everything's changing so quickly, we need to really think about where we're going. And we need to really put some pressure on ourselves, I think, to make sure that we are stretching people just enough. I can see it's achievable but maybe let's go one step a little bit further and put it just out of reach. So we have to stretch.

Ron Tomlian: 16:24

Stretch yes. And I think the days of a 2% increment, just take last year's plan, put 2% on it. That's enough. Those days are gone, as you say, because the environment is changing so rapidly. The world around us is changing so rapidly, we have to adapt. The strategic plan for some people, their definition of it is how an organisation is adapting to the environmental changes around it. If there's significant change happening around you, you have to change significantly as well. So under those circumstances, just having the old, add 5%, or add 2% just doesn't wash anymore,

Brenton Gowland: 17:00

Agreed. And I'm sure if you've been around a while you've seen whole industries almost disappear, or change tact completely. I mean, I hate saying this, but look at the taxi industry, they were relaxing and snoozing on their own merits and so forth, because they just controlled everything. And then another player comes along and shakes everything up. And and they got to start thinking they got to start moving on their feet. But because there's been no for thought you've lost all this time and all this space, and it's very damaging. So in the same way in our businesses now that Uber and the taxi industry thing that I've just kind of talked about, there is an example that might be a bit extreme. But there are many other examples of just needing to be on your toes. And if you snooze, you lose.

Ron Tomlian: 17:42

And industries or organisations that are not aware of the problems that their customers are experiencing. I mean, let's be fair, Uber wouldn't exist if the taxi industry was doing what everyone wanted.

Brenton Gowland: 17:57

And we were satisfied with the taxi industry.

Ron Tomlian: 17:59

Absolutely. I mean, we were satisfied with comparing taxi companies to taxi companies. But the whole product or the whole service that was being offered was substandard compared to what technology is allowing us to do now.

Brenton Gowland: 18:11

It used to be perfectly normal to get in a taxi that smelt of cigarette smoke and sweat and think that was normal. A I'm going to pay them a premium fee to go from A to B. Now.

Ron Tomlian: 18:20

Ah, the good old days hey.

Brenton Gowland: 18:22

Now you're able to rate them on how clean was the service. How effective was it. How nice were they. And it keeps people on their toes. And that's back to what we were talking about with pitfalls. It's like having a KPI on things, people can measure us people can manage us. So what are we doing in our own businesses, we need to be really creating plans that stretch us and just not letting life just trickle along.

Ron Tomlian: 18:44

And that's the whole idea of strategic planning is to look at what are we going to change to make the future state different from the state we're in at the moment.

Brenton Gowland: 18:53

Yep. And today, the pitfalls we're talking about are really all about finding a way to implement and removing the blockers that stop us from implementing a strategic plan successfully. Because, again, let's face it, today's episode is the conduit between us interviewing someone who's done it in the series. But to get it done, we need to have put in place structures, as you were saying earlier within our business and within our thinking to really make sure that it happens, implementation is massively important.

Ron Tomlian: 19:23

And keeping it front of mind on a continual basis. I'll sneak another one in there. You know, having, having I've seen it often happen, you review the strategic plan, or you develop a strategic plan. Three years later, say, oh, it's about time to do that, again, because their plan was only for three years. And that's the first time you've looked at it in three years. So it's a massive problem. It should be something that's on the agenda on a regular basis.

Brenton Gowland: 19:46

At least monthly.

Ron Tomlian: 19:47

At least monthly, I would argue almost daily.

Brenton Gowland: 19:50

In some fashion.

Ron Tomlian: 19:51

In some fashion associated with those KPIs and moving forward.

Brenton Gowland: 19:55

Yep and again, the hard work is breaking it down into chunks that are achievable by different people within your business and different departments within your business. But you know that! You our listeners are incredibly smart. You're listening to us going, yep, that's, that's what we do. And if it's not, then get some outside help to help you. And I would always suggest a mentor is a great thing. You know, the whole basis of this podcast is Ron is my mentor. Yes. And gives me a lot of advice. Usually, in the form of questions I've found.

Ron Tomlian: 20:23

I don't give advice I just ask questions.

Brenton Gowland: 20:25

Yeah, ask questions that keep me on my toes. So in the same way, if you're out there and you're having struggles getting things done, then find someone like a Ron or whoever it is. A business mentor or a coach or whatever to get into your business, to get alongside you and just to help you make sure that what you've created as a strategy gets put into place. Cool.

Ron Tomlian: 20:45

So that's six tips and a couple of extra ones as well. How to avoid problems associated with strategic planning.

Brenton Gowland: 20:52

Excellent. Okay, Ron. Well, we will see you next week when we interview our guest who is, we're still keeping mum on who that is. Number 20.

Ron Tomlian: 21:00

We'll keep it under Yeah, getting a guest in for wraps until next week, when we talk to him on the Business number 20. Well, you have a Builders Podcast number 20. great fortnight if you're out there and listening and we will see you in a couple weeks. So And bye from me. it's bye from me

Brenton Gowland: 21:17

Ciao.