Muhammad Ali had the capacity to land a telling blow.
None more so than when he said:
“The best-laid plan is forgotten the moment the first punch hits.”
In business, many strategic plans are soon forgotten, filed or sidelined whencompetition intensifies, cash-flows dry up, client and consumer confidencecontracts and banking credit policies are tightened.
Long-term visions shorten to myopic perspectives. Expansive scopes narrow, andpositive responses turn quickly to knee-jerk reactions.
Alligators, elbows, draining and swamps readily come to mind.
IT’S NOT ALL RISK MANAGEMENT
The current and recent business landscapes are littered with morsels andentrails of liquidations, failures, foreclosures, forced acquisitions andcollapses.
It is an unseemly and ongoing calamity.
Retailers, fashion distributors, car dealerships, new-home builders, propertydevelopers, contract and digital/on-line service providers are wellrepresented in the unenviable lists. Few sectors, professions and disciplinesare precluded. What are the dominant common factors?
Among the public listed entities, it is apparent that the strikingcommonalities are in the composition of Boards of Directors. Lawyers,accountants, bankers, merchant bankers and fund equity managers are wellrepresented, often being an overwhelming collective majority.
Understandably, the skill-sets that are foremost at those boardroom tables andin deliberations are financial prudence and risk management. Mitigationstrategies can, and do save money. Sadly, they do not address the need to makemoney.
Rapid change, innovation, creativity, disruption, technology and encroachingartificial intelligence are unrelenting. The impacts are fast, widespread andaccumulating. Customer-facing managers and service providers experience aresensitive to those dynamics. But sadly, are seldom or poorly represented onmany Boards of Directors. Redundancy and obsolescence seem inevitableconsequences.
Business is an art-form. Its language is heavily nuanced. That should bereflected in the wording and nature of documented strategic plans.
Sales margins, profits and market share can be very short-term.
“Good”, appropriate plans are a balance between financial prudence, riskmanagement and strategic direction. The latter attribute and feature typicallycomes from the input of experienced, qualified practitioners who have specificindustry/sector/profession skills. It is “They” who are so oftenunrepresented.
DON’T GET LEFT BEHIND
The broader retail sector represents a telling case study. Among the trail ofhigh-profile, established public-listed retailing operations which have beensubjected to liquidation in recent times are Maggie T, Roger David, Pay-LessShoes, Toys R Us and Ed Harry.
In most instances, there was a noticeable lack of industry “street-smarts”among the board members. “Capital” ideas are not limited to funds and funding.
Fashion retailers around the world have been found to be floundering in thepresence of fast-fashion operators, like Zara, H & O and Uniqlo. Productivity,velocity and volume among the latter-set have dynamic and appealing businessmodels. Business operators and consumers win.
Laggards soon lose touch with the marketplace, and with previously loyalcustomers. Market leadership in past years and decades counts for little.
Those factors, more so than the intrusion of on-line sales and thedistribution of digital marketing and AI (Artificial Intelligence), exposelong-established businesses to the very real prospects of decline, failure andliquidation.
Conversely, many highly prospective start-up entities fail because of the timetaken to formulate, document and implement an appropriate business model.
Inputs from accountants, patent lawyers, funds managers and passive seed-capitalists typically don’t address the very real need to plan for success,and are huge drains on scant resources.
BUSINESS, ACTION, TACTICAL OR STRATEGIC PLAN
Over four decades it has been apparent to us that many plans labelled“strategic”, fall well short of that benchmark.
A recent review of a local government strategic plan showed that, at best, itwas an action plan. The emphasis seemed to be on “doing things” rather thanaddressing needs, fulfilling expectations and achieving desirable outcomes.
The response from the local government executive was direct, striking anddisturbing. That plan complied with the accepted template, which determinedstructure, topics and essential focus.
Compliance was essential, to secure state government funding for thedocumentation of the plan.
So, from the outset and before any scripting, the plan was destined forfailure, under-performance or non-performance. Some reassurance appears to begleaned from the fact that all, or most, peer local government strategic planswould be identical, or similar.
Therefore, among many, not all, local government municipalities and involvingmultiple interest groups and people, expect a lot of activity. “Doing things”is the forte of the plans. Achieving outcomes seems to be outside the scopeand the planning template.
PLAN TO PLAN
Planning is an imperative. Reducing visions, intent, opportunities andpriorities to writing tend to contribute to the realisation of favouredoutcomes – if formulated astutely.
Within the military context, an overwhelming majority of strategic plans (notbattle plans, which are essentially tactical) are not about winning wars.Rather, most seek to avoid conflict and casualties.
When conflict is inevitable, casualties are minimised. The first Iraq War,during the 1990s, resulted in success for the allied forces and loss anddestruction for the Saddam Hussein-led Iraqi forces.
Indeed, General Colin Powell and his field commander, General ‘Stormin’ NormanSchwarzkopf, caused fewer than 250 deaths, some 70 of which were“misadventure” from “friendly fire”.
AND THE POINT IS …
When the marketplace and economy at large turns tough, there is anunderstandable need to sustain income, competitiveness and strike a measure ofstability.
That does not diminish the need for effective, genuine strategic planning.
Ready. Fire. Aim.
This is a dangerous, high-risk philosophy, which typically bears a high costof casualties and failures.
Those with experience on the battlefields and shop floors have much tocontribute. Analysing spreadsheets, with an emphasis on the bottom right-handcorner entry of “internal rate of return” are deficient.
Sting like a bee. Float like a butterfly. Don’t retreat to your corner, andthrow in
the towel. Above all, remember, not everything goes to plan.
Barry Urquhart
Conference Keynote Speaker
Marketing Focus
M: 041 983 5555
E: [email protected]
L: (08) 9257 1777
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