Platt Perspective on Business and Technology

Strategic planning and the process of strategy 4: planning for and through the unexpected

Posted in nonprofits, strategy and planning by Timothy Platt on September 23, 2012

This is my fourth installment in a series on the strategic process and on strategic decision making per se (see Business Strategy and Operations – 2, postings 314, 317 and 320 for parts 1-3.) I discussed strategy as it is regularly and consistently scheduled, and as an ongoing standard process in Part 3: quarterly, annual and five year planning, and that approach to strategy and its development constitute a basic organizing framework that a business is developed and run in. But effective strategy also has to be able to respond to the unplanned and unexpected too, and as and when that arises. My topic of discussion for this posting is unscheduled strategic reviews and course corrections in the face of unexpected opportunity or crisis, here focusing on response to crisis. And I begin that by citing a working example from my own experience, and one that I have raised before in other postings as I have variously posted on other aspects of business organization and business operations and strategy.

I was working at a large healthcare-related nonprofit on September 11, 2001 when the United States experienced its most severe terrorist attack in its history. I was driving to work with my car radio on when I heard that a plane had just hit one of the World Trade Center towers, and remembering the earlier truck bomb attack on those buildings, I immediately realized this must be a terrorist attack too. I heard of a second plane hitting the second tower building on that site as I reached the parking lot where I worked.

This nonprofit is an organization that is always strategically planning ahead, and its leadership had only recently concluded a regularly scheduled series of strategy planning meetings, in which goals and priorities were discussed and planned out with contingency models, going up to five years out. And with primary operational focus on preparing for the next one full year out. That represented the basic organizing framework that this nonprofit would maintain and build its programs around and prioritize and run its operations and projects around, and much as I outlined in Part 3 as for general principles. All of this went out the window when that first plane hit. And suddenly everyone in senior management and on the board was scrambling to find and develop a new strategic approach that could address the challenges and opportunity of a suddenly very different landscape for nonprofits and for those who would donate to them.

The first requirement here was to learn precisely what had happened, and in that I do not just mean the details of this large scale, complex attack. What responses were being made and who was involved? And it was quickly realized that any discretionary income and more, that anyone would donate anywhere would be directed in at least very large part to the now emerging emergency relief effort. Funding that would have otherwise gone to what the charitably involved public might see as more discretionary nonprofits in this new context, would see their funding dry up and even for monies already promised but not yet received, and monies that being expected, had already been allocated to meet real expenses and needs.

• Knowledge is the key here. Really understanding how your old strategic vision and planning would and would not apply now. And this means understanding any internal or outside events that would call for sudden strategic course correction. And this also means understanding how that would impact upon your business or organization, on your competition and on your marketplace as a whole. And the first business to gain an effective, operationally meaningful understanding of what has happened and on its expected consequences will be the first to effectively plan new paths forward that account for all of this.

Next, it is necessary to plan contingencies moving forward and even when you’re here-and-now first steps are going to be clouded with uncertainty. You do not want to move too quickly and simply find yourself stumbling as you still gather the information you need for sounder, longer term planning; you do not want to wait too long either as you need to take a position and take actions that will reassure, and both internally for your employees, and externally and for your clients and customers, suppliers and supply chain partners, investors if your business has them, and the news media.

And you act on this, and carry through on your initial responses while learning and preparing for the next day and your next steps, as you regain your footing for moving on according to a new strategic plan and with your new working goals and parameters for action mapped out.

And after the smoke has cleared, and the immediate crisis is over, you bring your strategy team together for a review of what happened, and with a goal of developing lessons learned, as well as for identifying and addressing any gaps or other problems that might have entered into your initial strategic and operational responses. And you communicate as appropriate about this, in-house with your employees and to your external stakeholders: customers, investors, etc. And you move on from there and ideally at least back into more of a pattern of more regularly scheduled and standard strategic planning and operational follow-through again.

I am going to discuss contingency and scenario planning as a strategy methodology in my next series installment. Meanwhile, you can find this and related postings at Business Strategy and Operations – 2 (and also see Business Strategy and Operations.) And I also discuss strategy and how it point-by-point connects to operations at Startups and Early Stage Businesses too, and see Nonprofits and Social Networking for more postings related to nonprofit organizations.

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