The Death of Strategic Planning: Why?

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Bill ConerlyContributor

I connect the dots between the economy and business decisions.

Opinions expressed by Forbes Contributors are their own.

3/24/2014 @ 12:41PM

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The Death of Strategic Planning: Why?

Like so many great people, Strategic Planning lived a full life. It
touched many businesses in a positive waybut failed many, as
well. It wasnt perfect, but it made contributions to society. In
the end, everyone said that it had lived well, but its time was
done.
As Ive gathered stories about my new book, The Flexible Stance:
Thriving in a Boom/Bust Economy, Ive talked to many CEOs
who say that they are no longer doing Strategic Planning as
such. Typically they say that they are focusing on execution, with
a number of them adding that they are trying to be more nimble.
The king is dead. Long live the king.
Strategic planning is dead. The new king is execution and
flexibility.

Many companies abandoned strategic planning in the recent

recession. Their practice had been to gather for a three-day
executive retreat to develop the strategic plan and play golf.
After the SWOT (strengths, weaknesses, opportunities, threats)
analysis, the team would define the one most likely path for the
external environment. The executive team would then develop
the appropriate strategy for that one vision of the future. By
lucky coincidence, the team always developed the strategy that
the CEO wanted going into the meeting.
The central problem, of course, was that the future didnt
cooperate. In 2008, the economy dove when it was supposed to
fly. Technology drove the world in surprising directions. For
example, importing liquefied natural gas looked great until
technology made exporting look even greater.. Social attitudes
sometimes changed too quickly for business, as when companies

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The Death of Strategic Planning: Why? - Forbes

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went bankrupt due to the uproar over pink slime (or finely
textured beef). The government, far from being a stabilizing
force, enacted major new laws that threw uncertainty at business
like a boxer throws punches at a stumbling opponent.
Inability to predict the future was the major cause of the death of
strategic planning, but other problems contributed. Companies
developed plans that said yes to every division manager
instead of shifting resources to the best opportunities. Strategic
plans were not connected to action steps, and when action steps
were described, they were in such vague terms that executives
continued to do what they had previously been doing. (See my
article, 3 Strategic Planning Pitfalls.)
Within strategic planning sessions, too much time was spent
crafting a mission statement that sounded noble but said
nothing. Too much time was spent on unique value propositions
that were pretty much identical to 17 competitors unique value
propositions.
In our eulogies for strategic planning, lets recognize what it did
right. Strategic planning got executives talking about the future.
The usual workweek is spent dealing with the nuts and bolts of
the business. How many quarter inch screws should we make? Is
three-eighths making a comeback? Should washers be bundled
with nuts or sold a la carte?
Strategic planning helped company leaders lift their heads up
and look at the horizon. The big picture emerged. Different
divisions plans were described, compared and coordinated.
Even though strategic planning had its faults, it had its
strengths.
In the next article I will describe what will replace strategic
planning. Oops, that is falling back on the old one best forecast
approach to the future. Lets say that I will describe one
approach to managing a business that can capture the strengths
of the old process while avoiding its drawbacks.
-Next Article: The Death of Strategic Planning: What Next?

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