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Strategic Planning Smothers Innovation

By: Jim Clemmer

Jim Clemmer is an international keynote speaker, workshop leader, author, and president of The CLEMMER Group, a North American network of organization, team, and personal improvement consultants based in Kitchener, Ontario, Canada. His other bestsellers include Firing on All Cylinders: The Service/Quality System for High-Powered Corporate Performance, and his most recent book, Growing the Distance: Timeless Principles for Personal, Career, and Family Success. His web site is http://www.clemmer.net/

From a standing start, a financial services company had two decades of very strong growth. They were entrepreneurial and opportunistic. New products, services, and distribution channels evolved and developed as the leaders passionately pulled the organization toward their vision. But its growth wasn't always a pretty sight. Product and service ideas seemed to come from the wrong people, at the wrong time, in the wrong ways, and for all the wrong reasons. Often they had to be developed on a shoe string budget or using the philosophy of "make a little, sell a little, make a little more". However imperfectly, customers were well served, product leadership was established, and in key markets, dominance was achieved.

Then senior management changed. The original, fairly well balanced, senior management team was eventually replaced with Technomanagers. When they looked back at the twisting and turning paths left by product development and marketing, they were determined to "bring some order to this craziness". These were "processes out of control", management declared. "They need to be reengineered". So a Strategic Planning Committee was formed. It consisted of fifteen senior managers and support staff from quality improvement, customer service, accounting, marketing, human resources, and planning. Over the next few years, they surveyed, researched, collected data, discussed, analyzed, diagrammed, and planned marketing strategies and new products. They wrote a powerful vision, values, purpose, and strategic planning document that could have been a business school case study.

Each thoughtful new product and marketing campaign took off with a bang... and then slowly fizzled. None were outright failures. But the company's history of ever rising sales success flattened out. Key people started leaving. Passion and energy levels slowly sank. Today the company is struggling to catch up with its changing markets and ever stronger competitors.

The new senior managers at the -- now mediocre -- financial services company proved to be caretaker or maintenance managers. They fell into these all too common strategic planning traps.

Strategy formulation was treated as a separate task. It isn't. No matter how much time and analysis you give it, no committee, staff support professional, consultant, or brilliant strategist can develop an effective strategic plan in isolation. Strategy is an interactive process. It might be separated from daily management, but can't it be separated from leadership. It is leadership.
Management committed the classic blunder of applying logical hindsight when they looked back at a series of opportunistic and serendipitous product and market innovations. In his book, Serious Creativity, creativity guru Edward De Bono puts his finger on the problem, "If every valuable creative idea is logical in hindsight, then it is only natural to suppose, and to claim, that such ideas could have been reached by logic in the first place and that creativity is unnecessary. That is the main reason why, culturally, we have never paid serious attention to creativity."
Adding up all the time the fifteen Strategic Planning Committee members spent in the market either finding or serving customers produced a total of less than ten percent for the whole group. Theirs was an artificial world of budgets, plans, analysis, strategies, concepts, theories, and numbers. The valuable experience of the sales, service, and field support people who lived in the real world (the market) were reduced to aggregate data points, opinion survey categories, and disembodied quotations on questionnaires.
Senior managers lost the rich learning, opportunistic, and urgent nature of evolving their strategies "on the fly" in the market. Effective strategic opportunism, like effective servant-leadership, both leads and follows.

It probably sounds like I don't believe in planning. That's not so. Effective planning is a critical success factor. But the focus and type of planning is what's critical. Two types are needed. First, personal, team, and organization planning should focus especially hard on improvement. This critical planning establishes systems and processes to continually build and improve understanding, skills, and competencies. So when those unexpected opportunities come along that fit your vision, values, and purpose, you're able to capitalize on them.

The second type of planning is implementation or action planning. It's disciplined, short term (today, any detailed action planning beyond two years is ludicrous) and centered around annual goals monthly or weekly priorities. In his book, The Rise and Fall of Strategic Planning, Henry Mintzberg concludes that the biggest reason strategic planning doesn't work stems from "the planning school's grand fallacy: Because analysis is not synthesis, strategic planning is not strategy formulation... ultimately the term strategic planning has proved to be an oxymoron."

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