It’s the start of a new year; I’m refreshed from a break and busting to pack new ideas into our plan for 2019. Large corporates hold executive planning sessions and retreats to document their strategy in a formal way. But what about smaller, growth businesses? I’ve started and run businesses for my entire career, but it’s never been clear to me how a fast moving, agile company should create and execute an annual plan.
I connected with Dr Kathryn Ritchie, Founder of Ignition Institute in New York. Kathryn leads an international strategy firm that specialises in working with leadership teams at high-growth companies to clarify strategy and optimize performance. She recently supported General Assembly to reshape their business strategy leading to a successful acquisition of the company in 2018.
“General Assembly is appreciative of the ongoing partnership and strategic support it has received from Dr. Kathryn Ritchie and Ignition Institute over many years”
-Jake Schwartz, CEO & Cofounder, General Assembly.
Kathryn and her team will be in Australia during parts of March and April and have limited availability to support scale-up businesses to develop or review their strategic plan for 2019. Contact us for info.
We worked with Kathryn to develop our strategic and operational plan for Zambesi for 2019. The Ignition team have developed a proprietary method so I can’t give away all the secrets. But, for businesses who can’t bring in a facilitator like Kathryn, I’ve documented as much of our process as possible below. Please ask questions in the comments at the end.
What’s in this article:
- When is it important to develop strategy?
- Step 1: Alignment
- Step 2: Environmental scan
- Step 3: Competitive strategy
- Step 4: Pictures of success
- Step 5: Identify drivers of growth
- Step 6: Develop core strategic pillars for 2019
- Step 7: Plan and agree on operating rhythm to drive accountability
- Why bring in a facilitator?
When is it important to develop strategy?
‘It’s vital for fast-moving companies to have a clear strategic plan, internal alignment and a disciplined operating rhythm,’ says Kathryn. ‘There’ll always be new opportunities for growth and a constantly evolving competitive landscape so the plan should be revised regularly. But if you don’t have one, or if you don’t have alignment, then the company will waste a huge amount of time and energy working on the wrong things.
In 2019, every executive leadership team or a founding team conduct a thorough strategic planning session at least twice per year; particularly if there’s a revenue slowdown, a new product in development or plan to enter a new market, a leadership transition, the need to align culture or if the company is looking to exit.’
Step 1: Alignment
Kathryn recommends that the first step in developing a strategic plan is to check in on the existing alignment of the leadership. Kathryn says: ‘It’s important to check in on each of the leaders of the business to uncover any misalignment.’
At Zambesi, my cofounder and I did separate interviews with Kathryn where she asked us a series of questions designed to identify any areas where we weren’t aligned. I was certain we were aligned on everything. We spend so much time talking about our vision for the company, purpose and values. But it was amazing to discover that we’d both made lots of little assumptions about the future that conflicted – just because we’d never spoken about them before. Clarifying these and becoming aligned at the outset, gave us a foundation to build our 2019 strategy.
Step 2: Environmental scan
‘You can’t develop effective strategy without looking at the context you operate in. There’s a systematic process we go through to do this. Start by considering the political, economic, social, technological environment and add competitive
You need to look at what’s going on around you - political, economic, social, technological and competitive environments - identify the trends and what they mean for your business. If you don’t do this methodically and often then you’ll miss both threats and opportunities.
During the Zambesi session, we identified a number of trends that will impact our business. One example is that people report having less time and more pressure at work – so it’s hard to take a full-day out to attend a workshop. This trend is increasing so in the future it’ll get harder and harder to convince people to take a day out to learn. Therefore, if we don’t adjust our strategy then our business will start to decline.
Kathryn also led a systematic ‘internal scan’ of our business. ‘It’s important to look at what’s happening internally – the good and bad things. What have you learnt, what are the achievements then reflect backwards and forwards to uncover the landscape the business is situated in.’
Step 3: Competitive strategy
‘Again, there’s a method for uncovering your competitive strategy, but you can start by asking a few simple questions. What’s our offer? Who is it for? What differentiates us?
What differentiates your business often isn’t what the founders or team think it is. It’s important to find things that are difficult to replicate. For example, culture is very hard to replicate which is one reason why it’s so important. The best companies will preserve the culture set by the founders.
Once you’re sure your competitive strategy is right then it shouldn’t flip flop. It should build over time.
Step 4: Pictures of success
‘At this point we look at three different horizons. We start with 3 or 5 years, sometimes further, and architect back to 1 year and 90 days. Identify the big areas you need to pay attention to. These will become pillars and initiatives for that year.’
For Zambesi, we looked at the end of 2021, the end of 2019 and then three months out. Once we architected backwards, we realised how optimistic our goals were. Kathryn challenged how we’d achieve each objective which forced us to focus on much fewer initiatives – just the really important ones.
Step 5: Identify drivers of growth
Here we considered our goals out to 2021 and the competitive strategy and identified what will drive our growth. Again, this process helped us to narrow in on a few very important initiatives. It was clear that a lot of our marketing efforts are spent on activities that won’t be core to our success.
Step 6: Develop core strategic pillars for the business
Our immediate and long-term goals are clear. We’ve identified our competitive strategy and what will drive growth. The strategic pillars of the business are obvious; we then set SMART goals for each pillar for 2019.
We develop a handful of initiatives, in service of the goals. We write out the initiatives on post-it notes and stick them onto a giant monthly calendar Kathryn has created on the wall. We then break down initiatives into tasks on the month by month plan. Each team member creates tasks and sticks them on the calendar themselves. We collaborate to shift around tasks and initiatives from month to month until we all agree that the plan is right.
By the end of the session, we’ve developed SMART goals for 2019 and monthly milestones so we can track our progress to the plan fortnight to fortnight.
This process is surprisingly cathartic. Even though it’s obvious that so much of what I’d hoped to achieve won’t be possible, it’s much better to realise this now and not waste time trying to do too much but not getting to what’s important! And everyone on the team is clear about our strategy and has bought into the monthly targets because everyone helped to create it.
Kathryn says that this process is important because it creates the architecture to execute on your strategy. ‘When you plot things out on a wall, you’ve taken them out of your head and you can do things with them – like move them around,’ she says. ‘You’ll get open input and commentary from the team. Transparency will lower team anxiety and the whole group will take responsibility for the execution.’
Step 7: Plan and agree on operating rhythm to drive accountability
‘Now there’s a clear plan, it’s vital to have good KPIs. We’ve developed a business tracking platform called Ignite to visualise and measure week to week progress against the annual plan. Doing lots of stuff isn’t going to get results. You need to set and measure weekly and monthly achievement goals to ensure you execute on your strategy and set numbers-based indicators so you know you’re going in the right direction.
Why bring in a facilitator?
As an entrepreneur, I’m always looking for the cheapest solution, so I’ve never brought in a facilitator to run a strategic planning session before. I’ve either tried to do this myself or wrangled an advisor or board director to help.
The impact of working with a professional facilitator was profound. Kathryn challenged us ruthlessly and brought to the group a global outlook and an understanding of the market and trends we’d never considered before. I also didn’t realise how hard it is for a founder to be dispassionate and independent.
Kathryn says: ‘Business leaders often have unknown biases and blind spots. We see so many companies, we’re pragmatic and can spot behavioural patterns and blind spots. Our job is to ensure you develop good strategy and to highlight the gaps. Founders and managers can often discount competitive threats. It’s also important that we make sure every voice is heard – and that’s surprisingly hard to do if you’re inside the business. And that the team is aligned on strategy, on an operating rhythm and on how goals will be tracked and measured.’
As a leader of a fast-moving, financially constrained business, our most precious asset is time and my biggest fear is that we waste time on the wrong things. In one afternoon with Kathryn and her team, we reimagined our strategy; we scanned our external and internal environment, zoomed in on our competitive strategy and drivers of growth and created a focused set of goals and initiatives to build our business as an aligned team.
Stay tuned for our first big strategic initiative coming in April…
Are you interested in engaging Kathryn or another Zambesi expert to work with your team? Contact us for information.
Experts for in-house training, coaching and consulting:
- Kathryn Ritchie, CEO and Cofounder Ignition Institute
- Craig Davis, Cofounder Sendle
- Karen Lawson, Former CEO Slingshot
- Stephen Scheeler, Former CEO Facebook A/NZ
- Andy Fell, Former GM St George Retail Bank
- View all experts here
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- Search Inside Yourself: Leadership transformation program developed by Google with Craig Davis, Cofounder Sendle
- People Leadership and Team Management with Andy Fell, Former GM St George Retail Bank
- Build An Award Winning Workplace with Mahesh Muralidhar, Head of People Airtasker
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