Most teams start planning from where they are to where they want to go. This is backward. Start with and keep in mind the long-term. Then, work back to prioritize the most important next steps that deliver your vision. Let’s look at how it works.
Starting planning with a short-term perspective creates stress and can make it difficult to focus on the big picture. Teams lose motivation and prioritize the wrong actions that don’t work toward your ideal future. So, start long-term to give purpose and meaning to the smaller actions you take.
From a 50 thousand foot view, strategic planning is a repetitive process of setting focus along with defining resulting success by working backward from the long-term to the near-term. Using this process creates confidence about what is the best next action that moves your business toward ultimate success.
StrategyOS breaks this into three timeframes:
- Positioning elements are ten plus years out set by Vision. They define why the business exists. They give purpose and inspire.
- Strategy elements are two to five years out set by Themes that describe a picture of how to build the vision. They connect the action of nearer-term plans to the long-term vision.
- Plans are made annually and at least quarterly to guide what to do next to best move your strategy forward. Rocks are set at least quarterly as the most important next thing to focus on delivering. They can be stand-alone deliverables, or milestones of longer-running Initiatives or Themes.
Start long-term to clearly define your Positioning. Create a focus and describe a result that are aspirational and unbounded:
- Mission: (a focus) Your business’ reason for being. What you are passionate about, can be the best in the world at, and can deliver an economic return.
- Vision: (a result) How your business will be described when you deliver you mission successfully. Describes how customers feel, the benefit they receive, and the impact you have made. “Vision” is a strong motivational phrase of purpose and is sometimes used in place of “Positioning” to describe the long-term outcome.
Once you define the future, make a clear assessment of where you are today. Evaluate your internal capabilities and the business context that can impact your business, including key trends that can accelerate or deter momentum toward success. Be honest about what you can exploit and what you need to overcome to build toward your vision.
Now you know where you are starting and have a clear picture of where you want to go, but it is too hard to follow a 10+ year path to delivering a vision without guardrails. Determining best actions with only a long-term vision, can be difficult to imagine.
So, pick a time in the future that you can describe with some clarity. This starts to put boundaries around how you will travel toward your vision. It can be between 2 and 5 years depending on how fast your business and industry moves. Most teams use 3 years out to create clear, descriptive pictures of envisioned success from a variety of perspectives. Use at least 4 important perspectives:
- Financial outcomes for stakeholders,
- Customer Value from your products and services or what problem you solve,
- Internal Processes needed to create the value (including sales and delivery,) and
- Unique Capabilities that allow the business to learn and grow.
The most important of these descriptive statements become Themes (a focus) with descriptive titles. Add understanding by giving descriptive Outcomes (a result) with ways to measure progress for each.
strat·e·gy (n): a course of action or policy designed to achieve a major or overall aim. — Oxford Languages
This creates the Strategy that is your focused course of action organized around trackable Themes. Themes define a waypoint on the way to achieving the long-term Positioning.
At this point, you have done two repetitions of creating focus and describing results: once for a 10+ year timeframe and then once for about a 3-year timeframe. Next, planning prioritizes deliverables that drive action. Planning suggests that you repeat the cycle two more times: for a one-year timeframe and for no more than quarterly iteration time-frame.
Annual planning is a norm in business and allows for a good medium-term focus. A quarter is about as long as a team can stay on task without the need to re-assess progress and understand impact of new learning, so iteration planning should happen at least this often.
In each of these planning cycles, as you did for the first two cycles, prioritize what to deliver (a focus), and how to quantify success (a result). In #StrategyOS, for annual planning we call the focus items Initiatives and the results Targets. For iteration planning, we call the focus items Rocks and the results Goals.
Starting from the long-term ensures that near-term actions are the most important next steps to work on. Keeping Vision and Themes in mind makes sure delivering iterative results stays aligned and leads to ultimate success.
You can find more detail about delivering your strategy in this newsletter on Transform Phase.
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May you find Passion, Joy, and Freedom in all your pursuits.