‘If you want to get ahead, get a hat,’ they said. Close, but no cigar. What you actually need is a strategy (although a jauntily worn beret will set you apart any day). Sound strategies let you articulate goals and how you plan to reach them, inspire support, stay competitive and turbo-charge performance. In short, the importance of strategic planning cannot be underplayed – and when executed well, can blow the competition away.
In 2019, just 16% of Chief Marketing Officers said brand strategy was among their top three priorities. By 2020, this had shot up to 33%, with a third of CMOs citing strategy as their primary and most vital strategic capability, even above marketing analytics. (Gartner’s 2020 Annual CMO Spend survey)
What is strategic planning?
As strategic planning is a term that’s much used and abused these days, let’s take a second to set out a definition. Roughly speaking, it’s a process where you set out long term goals and how you’re going to achieve them. These goals could involve a specific project or define the whole future of your brand. Strategic planning clarifies the destination and the route you’ll take to get there.
Now, for the purposes of this article, of course we could apply the idea of strategic planning to many areas of business. But, as a marketing agency ourselves, we thought a natural place to start would be in the brand strategy and marketing arena. So you’ll find a lot of our examples fall into this bucket, of course strategic planning can (and should) be employed across every part of your company.
Strategy vs business plan
A business plan and a strategy are not the same thing.
- Strategy is the vision, the motivation, the ‘why’. Planning is the detail, the mechanism, the ‘how’.
- Strategy sets out where you want to be. Planning gives you the map to get there.
- Strategy sets out your thinking. Planning unpacks it.
Although the terms are often used interchangeably, the distinction is important. Strategy is your identity. Planning is how you reveal it.
5 reasons why strategic planning is important
So, now we’ve got that cleared up, let’s get back to discussing why strategic planning is essential for any organisation, whether it’s a small business or global behemoth. For starters, strategic planning…
1. Gives a sense of direction
Once your brand has set goals, it must find a way to achieve them. A strategic plan illustrates how this will happen and the direction the brand will take.
The strategic planning process should use data and insight to organise your assets to ensure they generate positive returns. Resources, competences, capabilities – when they’re deployed with a masterplan, they’re at their most effective.
Goal setting is important, but your objectives don’t have to be financial. They could involve raising brand awareness, launching a new product or achieving transformation. What’s important is a defined path and crystal-clear ambition.
A word of caution: don’t be tempted to apply a ‘fair-weather’ strategy. By this we mean the kind that masquerades as the real thing, but is only used while it’s convenient. Lots of brands have these pretend strategies that they follow when it suits them. But as soon as there are challenges, the strategy vanishes, along with any pretence of a coherent, co-ordinated approach. Organisations with fair-weather strategies can’t understand why their brand comes across inconsistently. Do yourself a favour: get a strategy – and stick to it.
2. Provides a focus for everyone
When everyone knows what the goal is, you can all work towards it together. There’s a vision that the whole team understands and that inspires their work day to day. This engagement can make all the difference to an organisation. Engaged employees are more productive, give better customer service and are less likely to take time off or leave. In fact, one study by IBM showed that some 80% of employees say they have a better employee experience when they feel like their work has meaning. You can read all about it – and other employee engagement drivers – in this piece by our Maverick colleagues. If you want to know more, they’ll be happy to provide case studies.
Meanwhile, a clear strategy allows you to get buy in from partners and stakeholders, too. This is critical. If you want to achieve your objectives, everyone has to be on the same page.
When you don’t have a strategy, it means you’re relying on guesswork and off the cuff decisions – and that makes shareholders nervous. If you can’t set out how you’ll tackle challenges or take advantage of opportunities, you’ll lose the trust and confidence of investors.
3. Makes your organisation more competitive
Your strategy tells others who you are, what you want and what’s important to your organisation. It differentiates you from the market and gives you a Unique Selling Point (USP). And because strategy can involve studying market conditions, researching competitors’ plans and creating innovative product ideas, it helps you to steal a march on the industry. Brands that are guided by strategies are more proactive and able to spot problems on the horizon.
4. Turbo-charges performance
As we mentioned above, engaged employees are more productive. When everyone understands what they’re working towards and their role in achieving it, there’s a significant impact on performance. Research suggests that organisations with an engaged team are 21% more profitable than those without. The conclusion: a clear strategy directly affects the bottom line.
The psychology behind this stat lies in the motivation and teamwork that’s involved in striving for a shared goal. When people feel emotionally invested in what they do – and implicated in success – they become connected to the brand (or campaign). In other words, if you’re rooting for your ‘team’, you’re more likely to put in 100%. Bingo: good performance, healthy morale and higher revenue.
5. Brings consistency
A key element of a strong brand is consistency. Your strategy keeps you on the straight and narrow, delivering on the promise you’ve made to customers in different ways, but with a common thread. This strengthens perceptions of your brand, which can only be a good thing. Reinforce your strategy through your message and actions, and see the benefits it brings.
- 91% of consumers are more likely to do business with recognisable and memorable brands that provide them with relevant offers.
So, that’s the case for strategic planning. And to be honest, it’s a bit of a no-brainer. The tricky bit is getting it right, so here’s some handy hints.
Tips for successful strategic planning
Keep it simple
The best strategies are ones that everyone understands. To get everyone on board, you need a single, future-focused vision that’s in line with the organisation’s values and behaviours. If you can’t sum up your strategy in a couple of lines, go back to the drawing board and the planning process. Keep things simple, as we say here at Maverick. Make it easy for others to share the dream and buy into it.
Ken Allen, the CEO of DHL, is living proof of the power of single-minded strategy. Joining the company in 2008, he turned a €2.2 billion loss into €1.9 billion profit over the next ten years. The secret sauce that made it possible had one basic ingredient: radical simplicity. With uncompromising focus, he set about addressing the fundamentals with a clear focus on objectives.
Commit to your strategy
It’s no good devising a beautifully crafted strategy if you’re going to neglect it. Strategies need to be nurtured, accorded time and resources, and actively delivered.
Despite this very basic concept, 67% of well-formulated strategies fail due to poor execution. And over half (61%) of senior executives believe their organisations don’t bridge the gap between strategy formulation and implementation well. That’s not surprising, considering 70% of leaders spend less than a day a month on reviewing strategy, and 85% of management teams spend less than one hour per month discussing strategy. Meanwhile, strategies are starved of the talent they need to be successful: it’s estimated that fewer than 10% of leaders have the necessary strategic skills.
If you want your strategy to meet its aims, you need people who are capable of delivery and accountable for its success. Then, you need to make sure you…
Track and measure progress
Astonishingly, only 20% of organisations review strategy execution on a monthly basis. If you don’t bother to keep an eye on progress, how will you know if you’re achieving your aims, or if you need review, adapt and correct? Again, it comes down to committing to your strategy. Put in place formal metrics and tracking mechanisms so you never lose sight of where you are. Turning promising plans into success means checking they hit key milestones along the way.
Talk it up
Devising your strategy is the first step. The next is to explain it. Your employees can’t help you deliver your plans if they aren’t aware of them. It’s so important to bring everyone on the journey so your team all pulls in the same direction, from leadership down. In fact, poor communication has been cited as the top reason why strategy implementation fails.
It’s estimated that 95% of employees do not understand their organisation’s strategy, and just 27% of employees and 42% of managers have access to their company’s strategic plans. Fixing this means explaining the strategy clearly and repeatedly, through different channels and formats. So go forth and communicate: it’s good to talk.
So, what should you do? Do strategise, do simplify and do (always) communicate. But don’t leave your plans to fend for themselves or just use them when it suits you. Strategic planning may seem like a minefield, but it doesn’t have to be. Not when you’ve got the folk from PULSE on your team. Our Behavioural insight experts combine data with psychology to provide game-changing Maverick insights to shape awesome strategies. Want a chat? Then get in touch with us. Alternatively, you could always try buying a hat…