Pavel Nakonechnyy

Plan is not a strategy

Published (updated: ) in Leadership and Soft Skills.

Plan is not a strategy

When talking about the future it’s convenient for managers to plan things: a set of actions we want to perform, ideally, with concrete timelines. Planning is one of the five management functions apart from organizing, controlling, motivating & leading, and decision-making. Planning usually takes good judgment skills and includes something like “rent a floor” or “hire 2 Analysts”. However, a single plan is not enough for Business Success.

Strategy decides a path chosen for achieving the Business Objectives. By definition, Strategy – is an integrative set of choices that positions you on a playing field of your choice in a way that you win. Strategies are often developed by top management and then integrated into planning and decision-making at lower levels of the organization. Some examples of corporate strategies include mergers, diversification, divestment, and acquisition.

A good manager develops lower-scale strategies intended for his department or team.

Strategy has a theory: why we should be on this playfield and not the other one and here’s how we’re going to be better than anybody else. A strategic theory must be coherent and doable.

Planning does not have to have any of these. Planning is comforting and usually goes with the resources you spend.

When planning:

  – You control the costs.

  – You are the customer (rent, employees, procurement).

Strategy specifies a competitive outcome you want to achieve:

  – Actual customers are the customers.

  – You don’t control them.

  – You don’t control revenues.

As a manager, don’t fall into the “planning trap” working with plans that have no strategy behind them. Before coming up with a plan, develop a proper strategy. Here are some tips for that:

  – Accept angst coming with strategy. You can’t prove in advance that your strategy will succeed. It’s a theory. 

  – Lay out the logic and prerequisites. What has to be true for this strategy to work? Watch the world unfold and if something isn’t working out, tweak the strategy.

  – Keep the strategy short: where we’re choosing to play, how we’re choosing to win, the capabilities we need, and the management systems we’ll use.

Not knowing for sure isn’t bad management. It’s great leadership.

 

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