Scaling Up Execution - Building a great strategic plan

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As a Scaling Up Certified Coach, I spend much of my time teaching CEOs how to create elite strategic plans and execute them like clockwork—and how they can pass that discipline on to their executives and teams. I’ve often remarked that while I’ve met many people who possess certain aspects of leadership innately, most do not intrinsically know how to create the kind of strategic plan that is used in high-performing Scaling Up organizations until they deliberately learn to do so. But I also tell them that while we aren’t born doing it, you don’t have to resign yourself to acquiring that knowledge slowly through the School of Hard Knocks either. There are proven building blocks for success you can learn to use right now and put to work in your organization to increase your efficiency and profitability starting today.

While strategic execution will give you an opportunity to exercise your creativity, much of the process is very concrete, like puzzle pieces you can fit together to create measurable results. Sticking to your plan (and creating a culture in which your executives stick to it too) requires an iron-clad commitment—so consider that the hard part—but creating the plan itself can be made easy and repeatable. Thankfully, it doesn’t require a degree in rocket science!

Before we jump into the mechanics of planning, let’s first talk about the value you will get out of turning strategic execution into your next great talent.

Why Is Planning Important?

The function of your plans is to take your organization’s lofty intentions and turn them into a process that is definitive, actionable, and timebound. We all know what it is like when we let a plan slip and a goal is lost; it’s like your once rock-solid goal liquifies and eventually vaporizes into an amorphous gas. We let plans waft away all the time and I often see leaders giving themselves a hall pass when this happens. They tell themselves that it is OK that they didn’t execute their plans using one or both of these excuses: 1) We’re still going to do it, and when we do it, we’re going to do it “right” or 2) We will do it in “our own time.” (These are not leaders of small organizations by the way; I’m talking CEOs of $75–100M companies as they first implement Scaling Up). As a coach, sometimes I need to let them know that they are letting themselves off the hook too easily. I can sympathize with the fact that the busyness of business takes over and things get in the way, but your plans are the lifeblood of your organization’s success and they are too important to let go of. It’s like throwing money into the wind. (By the way, you will find your B Players are the busiest, hence my nickname for them: Busy Bees!)

Here’s some bonus tough love: If you don’t hold yourself accountable as a leader, you’re dumbing down your team.

There are five reasons planning has to be a priority for people in leadership positions:

  1. Because the goals are intrinsically important to the business
  2. The plan is there to hit the goal!
  3. There must be consequences for missing the goal. Lost revenue, cost reductions, quality misses, etc. What are the consequences for the executives who miss goals?
  4. The process identifies the critical levers and value drivers that improve the business.
  5. Leaders and managers are (or should be) evaluated on both their results and the quality of their plans.
Scaling Up Strategic Planning Graph

One of the things that I tell leaders who struggle with this is that I don’t care if their plans set conservative goals. Just set a goal and hit it on time. Your plan ensures you are asking the question, “When am I going to see a result?” Or as we would say when I was working at Ford Motor Company, “When is Job #1 going to get done?” If you don’t know, you aren’t doing your business justice.

Strategic Execution Is Executive Skill No. 1

Elite, high-performing leaders have many skills: industry knowledge, communication, the ability to inspire and mentor others, and being able to see the forest for the trees. But at the end of the day, executives are paid for one thing: getting results. The foolproof formula for that is:

Planning + Execution = Results

So consider strategic execution to be the most important skill you can cultivate in your business. Once you learn the anatomy of an elite plan and acquire the discipline to stick to it, you will see immediate results and you will be an instant convert. Moreover, since it is a recipe-style method, you can easily learn to coach your executives through it so they can help you create a revenue-generating engine that spans your whole organization.

The Must-Haves of an Elite Strategic Plan

A strategic execution plan that gets results has three key elements to meet specific SMART (specific, measurable, achievable, relevant, and time-based) goals in support of your Critical Number (the second of the ten Rockefeller Habits which I use and which Verne Harnish explains in Scaling Up). They are:

  1. Specific strategies (think maneuvering to a battlefield) and tactics (what happens on the battlefield)
  2. Built-in accountability checks and milestones so you can keep actively working and proving your plan
  3. Answers to how and when you will achieve the goal. What tangible results do you get by when?

Your plan breaks down a tough job into manageable goals to get your desired result using achievable milestones. For example, if I wanted to drive from my home base in the Midwest to California, I might break it down into comfortable eight-to-ten-hour drives each day, staying in nice hotels and eating at good restaurants. In this example, my milestones are literal mile markers, but you get the point—breaking the task down makes it less daunting than just attacking the whole with no plan. Without a plan, I’m checking in late at night to backwater towns and eating fast food.

The departure point from which you craft your plan is your deliverable expressed in SMART-goal form. A good example of a SMART goal is:

Improve gross margin from 51% to 53% by March 31st for a $400,000 profit improvement

Once you have your goal well defined, there are two more pieces of the puzzle to add:

1. Three to five strategies to achieve your goal (a strategic, multi-pronged approach)

Scaling Up Execution Example

2. Six to twelve discrete actions/tactics per strategy (detailed, provable action steps to deliver the goal)

Scaling Up Execution Example

There is left-and-right-brain balance that comes into play in this part of the planning process. Unlocking the lead drivers related to your goal and crafting your three to five strategic prongs engages your creative right brain. Then your left brain can get to work on coming up with six to twelve concrete actions that support each strategic prong. I tell my clients to give me a six-pack or a twelve-pack execution plan because any significant strategy has at least 6 to 12 discrete steps. (Besides, beer analogies are memorable and the plan tastes better when executed!)

These actions are “show me the money” activities—they all support the Critical Number, directly or indirectly. They are not simply a to-do list, broad statements, or a list of what I call “things and stuff.” They are time-based, discrete, provable actions that show your team is on track to meet your goal. If you are a devotee of the Scaling Up One Page Strategic Plan (OPSP), this kind of plan derives from and can be plugged into columns 4 (annual) and 5 (quarterly). The same procedure can cascade down to your executives as they structure their own departmental plans.

Here are a few more examples of SMART goals just begging for a great strategic execution plan to turn them into reality:

  1. Improve website leads from 500 to 600 per month by date x to improve monthly revenue by $175,000
  2. Increase sales conversion from 25% to 30% by date x.
  3. Improve days sales outstanding (DSO) from 30 days to 25 days by date x.
  4. Improve sales labor efficiency ratio (LER) from $5.5 to $6.0 by date x.
  5. Find four new pools of manufacturing talent and hire 10 new operators by date x.
  6. Pivot from HR to a human capital management (HCM) department by date x with a new HCM manager in place.
  7. Complete A Player Agreements and personal performance promises (PPP) for a department of five by date x.

I find that the best way for CEOs and their teams to stay updated and aligned with the detailed tactics/actions is to use technology, preferably a strategic execution application like Scaling Up Scoreboard or Metronome. These apps are very sophisticated when it comes to keeping track of deadlines and flagging overdue tasks. Automation takes you a quantum leap toward eliminating the time you might otherwise spend finding out who is making their goals or who has dropped the ball and why. The days of holding people accountable with paper are long over.

For example, here is what a successful company-level quarterly strategic execution plan looks like this in one of these tools:

Scaling Up Execution Example

As you can see, you and your entire team can immediately get an overview of how your plan is coming together and if it is on track. With this capability, you can immediately drill into areas of interest to check tactics and timing. Imagine how much better your company will be able to craft and execute your strategy by developing your plans with this level of strategic thinking, detail, and transparency!

A Properly Constructed Plan Fosters a Culture of Accountability

It’s often that element of transparency that will get your team nervous, but it is critical in determining where and by whom your goals are being missed. Peer accountability is one of your most valuable leadership tools, and many leaders make things harder on themselves by not deploying the kind of 360 accountability that Scaling Up coaches and companies employ. High-performing teams have a culture of accountability at the heart of everything they do.

The beauty of this kind of recipe-level plan is that it is so specific and tangible that everyone’s progress is in the spotlight at all times. Nothing is obscured. As I describe in my book The A Player, A Players will be energized by this kind of accountability and will bake it into their own plans. They will want to show their value as an employee and contribute to hitting the goal. B Players may need to be coached up to that level, and C Players just may not get it. Keep this simple graph in mind to illustrate the importance of having A Players on your team when it comes to improving performance and execution:

The A Player Graph

You want the kind of accountability and planning savvy represented by that green square in the upper right-hand corner to happen in your business. Imagine that you have a football team, and during the big game, a quarterback passes a ball, and the receiver misses a pass they should have caught (with the robust analytics we have these days, everyone knows whether they could have caught it). This can happen to any athlete, and you would encourage them to catch it next time. But what would you think if the receiver denied responsibility for missing the pass and blamed it on the quarterback? That kind of thinking can cost downs and even games.

Unfortunately, that mindset plagues businesses, and make no mistake: There is no place for that in your business. In the real world, missed accountability costs companies millions, and it can be cumulative. You want the people executing your plans to feel comfortable with—and even excited about—being accountable for flawlessly executing their well crafted plans.

Here’s What’s In It for You

In addition to growing revenue, perfecting strategic execution according to this recipe yields three things for leaders. First, it creates joy for you and others. I don’t necessarily mean that your team will always be happy that you are holding them accountable; happiness and joy are two slightly different things. Joy is actually a much stronger emotion as it is much more enduring than happiness. What you will see are team members who are joyous about crushing goals and are eager to create and share their plans. Stemming from that is the second thing: You will see better job satisfaction, and therefore less churn among executive and managerial positions. Last but not least, you will enjoy better personal and business results.

As easy as strategic execution planning can be when you are taught to do it correctly, the truth is that most companies aren’t doing it. If your planning is falling short and you aren’t producing industry-leading results, take this opportunity to change your ways, starting today. If you want to learn more about honing this most critical of all leadership skills and how to use it in your organization, schedule a coaching session with me. I’d be happy to talk with you about the goals you have for your business and how we can work together to build strategies to achieve them.

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