Why Strategic Plans Fail
6 reasons why firms' roadmaps to the future never gets past today
By Gary Shamis and Jay Nisberg
We’re all familiar with the adage “The best-laid plans of mice and men often go awry,” and nothing could be truer of strategic planning. In fact, strategic plans, like New Year’s resolutions, often don’t go anywhere at all.
Always well-intentioned, they begin with energy and commitment, culminating in a large glossy report or fancy PowerPoint deck. But all too frequently, after an initial flurry of activity, they succumb to daily fire drills and urgent requests, left to languish on a real or virtual shelf.
What is it that goes wrong? Why can’t strategic plans stay on track? We have helped many organizations create a more successful strategic planning process, and in our experience, there are a number of reasons why strategic plans fail to deliver.
1. Change is hard. Strategic plans are about charting the future, and in today’s constantly morphing business environment, that rarely means “Keep doing what we’ve been doing.” Yet often, company culture is built around that very thing that got the organization to where it is today. Pulling the rug out from under all that is scary. There is an enormous amount of anxiety about what the consequences might be for a truly game-changing strategic plan — and sometimes the fear triumphs. Those fears need to be aired openly as part of the planning process.
2. Entrenched special interests. Not only is change hard, but some people in the organization may prefer to keep things just as they are. Shifting gears can mean making adjustments to people’s areas of responsibility or to the reporting structure. Part of developing an effective strategic plan is identifying where there are likely to be pockets of resistance or groups with special agendas that may not be in the company’s best interest — then having a solution in place for addressing those groups’ concerns.
3. The plan lacks inclusiveness. For a firm to grow and thrive, there needs to be more than a small cadre of people driving it forward. But when strategic plans are developed secretively, behind closed doors, it can be difficult to get everyone on board when it comes time for implementation. Certainly, it is the job of leadership to establish a vision for the enterprise. But most organizations possess a pool of hidden talent that is not always leveraged to its fullest potential. These are people with ideas that are worth listening to — and if they feel they are being heard, and that they are actually contributing to the company’s future and have a role to play in it, then implementing the strategic plan is likely to go a lot more smoothly.
4. The organization is too focused on short-term results. We live in a “what have you done for me lately” world, whether it’s customers, investors, employees or management. Everyone is under tremendous pressure to deliver results on an annual, quarterly or even monthly basis. A longer-term strategic plan can call for changes that eat into those results in the short-term. Sacrificing short-term performance for long-term growth requires unwavering leadership that can say “no” to the easy way out.
5. Management is reluctant to let go. This is often a particular problem when the founders of the company are still very much at the helm. They want everything to be perfect, so they feel the need to be involved. But as the company grows, this is no longer a viable approach. One organization we worked with came to this realization during an offsite planning session we were leading. Management’s desire to get involved in all the details was causing the organization to miss significant growth opportunities because they had no time to focus on the bigger picture. What’s more, talented potential leaders were not being fully leveraged. Because the company was growing at a healthy clip, no one really identified this as an issue until they stepped away as a team to consider the company’s future.
6. The plan is short on accountability and goals. These two often go hand in hand. The plan sounds great — it’s going to solve everything. And that’s where the problem starts. As one executive at a midsized CPA firm we worked with put it, “We were trying to improve everything, and we ended up improving nothing.” Goals need to be concrete enough that there is a viable path to execution. The strategic plan also needs to assign accountability and specific milestones and timelines for each initiative it encompasses. Without that accountability, the daily firefighting will quickly take precedence over moving the plan forward.
None of these challenges is insurmountable. With a different approach to strategic planning — one that gets people thinking both creatively and practically, includes goal-setting and accountability, and gets all of the important issues out in the open — companies can end up with a solid plan that lives and breathes, instead of collecting dust.
Jay Nisberg is a nationally recognized consultant to the accounting profession, and Gary Shamis is the national strategy and growth advisor at BDO USA, and the former managing director of a Top 100 Firm. They are the creators of the “Stratagem” approach to strategic planning, and the authors of Stratagem: Simple, Effective Strategic Planning for Your Business and Your Life.