The pitfalls of strategic planning

Is strategic planning important? The answer is, of course, yes. Is strategic planning successful in many organizations? No. The root cause is failure in execution. I am saying this based on my experience and observation.

Though the discipline of strategic management had its origins in the 1950’s and 1960’s, with the management guru, Peter Drucker, as one of its influencing contributors, it gained more adherence in the late 70’s. I recall right after taking my management course in 1980 at our home office in the US, the newly-appointed head of strategic planning, came to the Philippines to immerse us senior executives with the new discipline.

The executive briefing covered the crafting of our vision, mission and core values, SWOT analysis with action plans to enhance our strengths, overcome our weaknesses, take advantage of our opportunities, and address our threats.

We were also taught how to align our strategies, goals and action plans with the company’s vision and mission and factor these in our Performance Management System.
Like the practice of Management by Objectives (MBO) in the early 70s, strategic planning caught like wildfire in all organizations, profit or non-profit. It even spread throughout the government bureaucracy. I know of government departments and bureaus going out to the best watering places outside of Metro Manila, far from the madding crowd, to engage in strategic planning.

Like a mantra, vision, mission, and values are writ large on the walls and other conspicuous places of some LGUs and government agencies. But given the mediocre performance in the government bureaucracy, it is obvious that their strategic Plans remain just plans – long in planning, short in execution.  Like the famous refrain of Mona Lisa song, plans in the government, “just lie there, and they die there.” The new administration of President Duterte  – though a lot of cynics doubt it – may yet change this lethargy in government.

With some notable exceptions, the private sector is not far behind in its lackluster performance. The precious time spent by directors and executives in formulating strategic plans, if quantified in money could reach millions of pesos.

This does not include the actual costs of transportation, food, lodging (if held outside of the office), materials and handouts, and facilitator’s fee. The problem is, lack of execution, follow up, and honest-to-goodness performance review.

There are two major processes in strategic planning: Formulation and Implementation. Formulation of strategy involves analyzing the environment in which the organization operates, then making a series of strategic decisions about how the organization will compete. Formulation ends with a series of goals or objectives and measures for the organization to pursue.

Implementation involves execution of the goals or objectives and action plans within the agreed time line. It deals with the mobilization of all resources to achieve results. This is where the strategic Plans bog down. The inertia loses steam either due to lack of political will or ningas cogon affliction.

Political will is the strong commitment of management to achieve the goals, objectives and action plans as agreed. I find this kind of commitment and zeal to execute lacking among many companies. This is one major reason why strategic plans fail.

Another culprit in implementation of strategic planning is the “bibingka” attitude among us Filipinos. “Let’s do it because others are doing it.” strategic planning becomes a flash in the pan, the flavor of the month. It starts with a bang and ends in a whimper. We simply don’t finish what we started.

I just wonder how many of you could claim 80% achievement of your strategic Plans. I suggest you look back in your business organization or even in the non-profit professional organizations where you belong. How far have you achieve results in your plans? I’ll be darn surprised if your organization has achieved 80% positive results of your plans.

Implementation seems to be the hardest part in strategic planning. There is one more cause in failure of strategic planning: Lethargic top leadership. It is axiomatic that for strategic Plan to be successful, it must be actively led by top management itself; anything less than this, it’s bound to fail.

Strategy is about the future. It is looking at a time frame that we call strategic Horizon. To get there, one has to go through the hassles of developing a vision, mission, setting goals and objectives, crafting a strategy, executing and evaluating performance. And it must be CEO/COO-led. Short of these, it remains a strategy and a plan, an illusory dream.