The Strategic Planning Delusion

By Don Schmincke

“Every year we invest in a 2-day strategic planning retreat. But we never seem to leapfrog the competition. We achieve parity at best, but not the market penetration I hoped for.”  - CEO overheard at an industry conference

Over twenty years of research finds thousands of CEOs voicing their frustration with strategic planning efforts. Not a new complaint, the issue has been exposed in books like Henry Mintzberg’s Rise and Fall of Strategic Planning or by notables like Tom Peters describing the 10 percent success rates of strategy as “wildly inflated.” It’s not that spending time on strategic planning is bad, but what should executives do differently?

An answer was recently found in a unique laboratory - the death zone; that altitude above 26,000 feet where lack of oxygen threatens long-term survival. Here, climbers resemble executives. They live passionately while confronting impossible odds. Some are deeply humble while others are psychotic narcissists. They come with all levels of competence, from naive wannabes to elite athletes. And when put to the test, climbers react like executives: sometimes heroically, other times self-destructively.

Instead of finding new methods that separate great executives from the not so great, the research exposed something else. Remarkably, executives who create and execute great strategies in the face of extreme challenges - let’s call them high altitude leaders - walk a different path. Rather than apply newly discovered methods, they succeed instead by recognizing and surviving specific dangers. Dangers always emerge when executives take their companies to higher levels. In the most extreme situations, on battlefields or mountains, these dangers can result in death.

Though often ignored in the literature, four dangers threaten every executive team when they engage in strategic planning:

Fear of Death: Last year at 26,500 feet on K2, an experienced Sherpa slipped of the edge into the darkness. He would fall for several minutes before hitting the glacier below. All the climbers stopped as the fear of death gripped them. This jeopardized what could be a successful summit.

The same happens in strategic planning. Unconscious anxiety about the death of a project, product line, sales target, market, career, or strategic goal causes executives to freeze. When this happens, strategic breakthroughs are jeopardized as managers shirk great decisions, avoid taking risks, stop challenging each other, and resist changes.

High altitude leaders free up strategic thinking by embracing death. This unleashes innovation versus preserving the status quo, creates new opportunities versus resisting the inevitable death of a cherished product or market. Ancient and contemporary leaders call it “dying before battle.” Companies facing bankruptcy can experience the same effect; a freedom to take risks and pursue innovative strategies. What decision is your strategy team avoiding? What long overdue actions would they take today if the company was really dying?

Selfishness: At high altitudes, selfishness kills people when new strategies are critically needed to deal with injuries, equipment malfunction, limited resources, and threats of avalanche and weather. Likewise, in strategic planning selfishness kills new ideas and covers up problems as executives let personal agendas drive strategy development. Post-mortem business case studies blame corporate failures on reasons like strategic missteps or poor implementations of good ideas. But digging deeper among the carcasses reveals that selfishness alone drove the agendas or cover-ups until it was too late. This explains why resources get misallocated, decisions become watered down and the organizational commitment wanes.

High altitude leaders, on the other hand, drive from a fervor and zeal for achieving strategic results that rises above selfishness. They inspire a higher passion in others by creating a compelling saga (from the ancient Norse term). For thousands of years executives aligned the masses on strategic execution via a shared drama.

“Many executives today are taught to avoid the drama;
and is why so many are outrun by so few.”

Passion is profit. When passions are greater than selfish agendas, creative strategy emerges. Is your team driven by a passionate saga or just empty words in a mission statement? Or maybe they’re just going through perfunctory planning retreat activities and missing the point, which leads us to the next danger: Tool Seduction.

Tool Seduction: In mountaineering, tool seduction endangers climbers every time they dress in the latest gear but apply the wrong techniques and behaviors to the challenge. In their overconfidence (or naiveté), they end up lost on a storm-ravaged slope for days while experienced climbers are at base camp having a beer and watching the weather. Similarly, facilitators packing the latest tools and processes for strategic planning bog down progress and distract teams from focusing on the vital issues. But tools are important, right?

Yes. Tools offer hope. Tools make people feel like they have the right answer. Who dares argue with the ideas from a best-selling business book? But the results aren’t pretty when you get seduced by the buzzwords and cool concepts. Tool seduction detours the planning process from real strategic thinking into a labyrinth of mechanical, analytical processes. This explains why the majority of strategic plans aren’t strategic, but tactical; even though they have a “strategic plan” cover. Executives possessed by tool seduction confuse strategic planning with analysis; contrary to Kenichi Ohmae’s observation that true strategy lies beyond analysis - it exists in the domain of intuition. Why do companies who drive superior market performance ignore industry expert analysis and advice? Industry experts only know what is already known. Your job is to out-intuit what is known, to outmaneuver the competition.

High altitude leaders don’t get seduce by tools, and avoid the seduction that diminishes intuition. Do your planning team’s tools support creative transformation of your beliefs, or distract you with fill-in-the-blank, analytical processes? Do your tools enable you to act decisively, or just clog your shelves with interesting, but irrelevant, information? Avoiding tool seduction helps fuel team passion for the challenge ahead instead of derailing the team with useless meetings, lingo, and processes. But even if your strategic planning team does it all right and survives fear, selfishness, and tool seduction, it still must contend with the coward within.

Cowardice: Cowardice dangerously stops both mountaineering and corporate teams from challenging the status quo, holding each other accountable, and exposing weaknesses. This danger happens as soon as planning team members are too afraid to confront previous violations of accountability or take necessary risks with each other. And it causes strategy failures by stopping the essential act needed for effective strategic planning - telling the truth.

Cowardice eats truth. Lack of truth eats strategy.

Initially telling the truth can upset people and cause discomfort, but good planning teams love it and it drives accountability to new levels. The alternative of keeping the truth at unspeakable levels only produces collateral damage - dead-weight ideas and doomed projects. High altitude leaders develop bravery, which allows them to achieve the risk-taking, commitment, and truthful communication necessary for innovating strategy. Rather than reveal the truth about a situation does your team choose avoidance, denial, and silence in order to avert possible discomfort, anger, or retribution? Do team members whisper about uncomfortable issues outside the meeting?

Being aware of the above dangers, which can emerge in strategic planning sessions, helps executives reach higher summits in real strategic thinking; and not get deluded into tactical distractions. The intuitive strategies that result drive much higher market-share penetration, profitability, and commitment.

Read other articles and learn more about Don Schmincke.

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