In todays transformational times, technology is driving business process transformation in ways it never has in the past -- in ways that are faster and more dynamic than anything weve witnessed previously. Technology can provide options and capabilities that most executives may never have considered simply because they dont know whats possible. This is why active input from the CIO is increasingly more important; the CIO knows whats possible technologically. Technology is a key enabler of strategy. Typically, once executives know what their top five strategic imperatives are, they then look at what technologies will enable those imperatives in the most cost effective, efficient, and game-changing way possible.
If you simply ask people what they want and then you give it to them, youll undershoot because people will under-ask. They dont know whats possible. In that same way, the strategic planning committee will undershoot identifying strategic imperatives because they dont know what is technologically possible. And today, there are new things that are technologically possible every day.
So, yes, financial planning is a vital component of strategic planning; it helps your company reach your financial goals. But true and thorough strategic planning also looks at how you gain new competitive advantages and other broader concepts that can accelerate growth beyond the target numbers of a financially focused plan. Dynamic strategic planning needs to be a mix of financial planning (strategies to reach financial goals), strategy focused planning (strategies to create sustainable competitive advantage), long-range planning (using research to determine future positions), and tactical planning (to determine your execution strategies).
An old saying tells us, Failing to plan is planning to fail. That saying has never been truer for companies than today, which is why having a strategic plan is so essential. But just having an annual strategic planning process that creates a fixed, static plan is no longer enough. Today, its important to build change into the plan and have the ability to adapt it in real-time because the world and markets are changing so quickly. In other words, its time for companies to do some dynamic planning.
These days, a traditional static plan is becoming less desirable and less effective, and a dynamic plan is becoming more relevant and imperative. Whats the difference? A static plan is a document that is published, shared with key employees, and then put in a filing cabinet. In contrast, a dynamic plan goes beyond one-way informing and also communicates the plan in a two-way, on-going dialog to everyone in the enterprise. A version is also shared with strategic partners. Its a living, breathing, and evolving entity that everyone engages in and supports. Think of it like this:
Why are these three points so important? Because with a typical static strategic plan, people may not have time to read the plan, they may not agree with the plan, and they may not take action on it. In addition, they may find major flaws in the plan but have no means to provide risk-free feedback regarding their concerns.