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Dynamic Strategic Planning The latest management literature and recent spectacular rise and disastrous fall of hundreds of companies in the dot com world have highlighted an important if not thoroughly disconcerting trend: The overwhelming preponderance of would-be entrepreneurs and their egregious taste for money without first developing substance. All eyes were focused on an exit, some Grand Prize lifted out of the generous hands of a greedy investing public who wanted - needed - to believe that their very fortunes were not years or even months away, but just days or weeks away, given the right Internet deal. In record time, this opportunism had seemingly characterized an entire generation of wannabes: men, women, children of all ages lining up with their pick axes and shovels to harvest some easily obtained vein of gold that would wrap them in the warm blanket of lifetime security. And who could blame them? Daily, our newspapers and magazines reported on the fortunes made literally overnight, the Porsches and the private jets and beach houses being glommed by nouveau nouveau riche twenty-somethings who were labeled geniuses, who as easily were handed venture capital investments for $20 million, $50 million, $100 million or more based on an idea simply because it had "dot com" attached to its moniker, as they would have just a few years earlier an ice cream cone or a lollipop. The story is not a new one. John Kenneth Galbraith waxes prophetic back in 1993 with his prescient A Short History of Financial Euphoria. Whether it was the tulip craze of the 1600s that drove the price of tulips to prices exceeding 1000 times their initial value inside of a few months, where families bet their fortunes on flowers, or the dot com debacle of the past several years, when opportunity knocks, the public at large flocks. Naturally, this past episode is instructive in many ways. For our purposes, however, and for what I'll say is the single most important point learned, is how definitively the ineffectiveness of opportunistic thinking was illustrated, as was the absolute need for a committed strategy to secure any type of future for most of these well-funded companies. And strategy can only come about through trial and error, through the application of hard-won experiences that point intuitively toward some proper course of action. Clearly, with no apparent precedent, any strategy was as good as the next. Especially with a media blitz hailing the arrival of a New Economy, a new way of doing business that would utterly supplant the way things have been done since the dawn of time. The arrival of Marshall McLuhan's Global Village, or Alvin Toffler's Third Wave. It was here, the Truth of the pundits was being realized and life as we know it would be changed forever. "Forget everything you know!" declared the new business literature. Everything, indeed. Except that one important bit of knowledge probably should not have been forgotten: Businesses have to make money to stay in business. That simple, common sense tenet was all but ignored. And the rest, as we say, is history. And Professor Galbraith had but another chapter to add to his book. So how does the devastated landscape renew itself? What panacea exists to cure the ills of the dot com world? How does the application of strategy change things? Only with substance, with discipline and with patience. We speak of committing to a strategy because it is only useful with an outright commitment to it. And businesses borne about an idea have the difficult task of moving their ideas toward reality. And reality means first designing a plan to make at least as much money to cover the cost of operating that business. Otherwise, it has no business being in business at all. Harsh criticism? Twenty-twenty hindsight? Perhaps. However, at the end of an era, at the epiphanic moment when things become clear, it's important to have come away having learned something. Media giant Sumner Redstone reminds us in his autobiographical sketch, A Passion to Win, that "Success is not built on success. Great successes are built on failures, on frustrations, even catastrophes." Having just witnessed one of the most spectacular catastrophes in the history of modern business, one might hope that it's axiomatic that from the important lessons learned, a spectacular renewal flavored with unbridled successes might emerge. But not without effort. And that's the best lesson to learn. And this article is about the application of that lesson - the need to plan, articulate and implement a strategy - a course of action intended to accomplish a specific goal. This is by no means a condemnation of those who seek opportunity. Every great business empire was built on opportunity, by taking risk, but also by moving strategically toward a pre-defined goal that benefited the business. What I'm presenting here is a methodology, a framework to install in just about any organization, to provide for the ongoing development of that organization strategically, that is, with specific objectives in mind and a well-defined course to achieve them. The nuance, or twist, to this methodology, is that the planning takes place dynamically, and for the sake of simplicity in communicating this framework, I'm calling it Dynamic Strategic Planning, or DSP. What is Dynamic Strategic Planning? The American Heritage Dictionary of the English Language defines "dynamic" as something characterized by continuous change, activity, or progress. The strategic planning process is often not thought of as a process at all, rather it's thought of as an event - a meeting or series of meetings that take place periodically to assess the status of a company, and attempt to articulate a plan to realize certain management-specified goals in the future. Few points of view could be more detrimental to the health and well being of a viable enterprise. Strategic planning must be an ongoing, continuously monitored and adjusted process, fully integrated with the daily operations of the business to enable its continuous improvement. To accomplish this, the strategic planning process must be couched in an entirely new framework - a seamlessly integrated, iterative process that spawns ever-more valuable manifestations of the company at which this process is adopted. And what exactly is Dynamic Strategic Planning? In addition to the application of my more than fifteen years of hands-on experience developing and implementing business plans for more than sixty early-stage companies, DSP borrows from several best practices currently employed in technology-based businesses, including the Rational Unified Process, the Microsoft Solutions Framework, and J. William Pfeiffer's Applied Strategic Planning. While each in its own right is extraordinarily valuable, the specificity with which the RUP and MSF have been designed (i.e., for the software industry) limit their applicability somewhat; a need for a more generic framework was called for. And while the ASP provides an excellent step-by-step process for creating a strategic plan, it is weak in its development of the action plans required to realize the objectives of the strategic plan. Furthermore, the superimposition of the ASP atop the RUP and MSF to stress their iterative, and therefore constantly-improving, natures provides a formidable yet friendly framework for ongoing strategic planning, implementation and assessment. To be sure, DSP incorporates the six "best practices" found in the RUP. Accordingly, DSP is:
Identifying opportunities worthy of pursuit is a function of intuition and sound judgment arising out of experience. Turning an opportunity into a desired outcome - the attainment of some stated objective - requires organization, discipline and a committed strategy. As a framework for efficient process management - the very heart of the value of any enterprise - DSP addresses this need by providing an overarching philosophy for owners, managers and functional staff alike, to foster the realization of their collective company goals. References
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Copyright © 2002 by Rob Berg. All rights reserved.
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