Corporate Strategy and Strategic Planning

    “These are the times that try men’s souls.” Although that statement could have been written in recent weeks in response to the extreme volatility in the global financial markets, most of us remember its original source being Thomas Paine’s writing at the beginning of the American Revolution in 1776. But, it is just as pertinent today, depending on the present status of your business.

    While Google announced quarterly profits last week that surpassed Wall Street expectations and hired 500 new employees in the most recent quarter, E-bay announced in September it was cutting 10% of its staff or 1,500 people. This is in the same industry but from significantly different business models and markets.  

    IBM, like Google, announced quarterly profits that surpassed analysts’ expectations this month on almost 5% growth in sales. Another Dow Jones component, Alcoa, announced a 52% drop in profits in relation to the same quarter in 2007, but was still profitable. Southwest Airlines actually posted a loss for the first time in 17 years due to an accounting charge but actually was profitable from actual operations.

    What do all these big business results mean for small business in the Hudson Valley? It means that there are always challenges and opportunities in every economy. To thrive in this new economy or for that matter in any economy at any time, it is imperative to have a plan.

    In discussing the importance of having a strategic plan in a recent conversation with a business owner considering my consulting services he commented to me, ““you mean flying by the seat of your pants is not a successful strategy?”  Yet, he and many other business owners are doing just that.

    For decades the SWOT analysis (Strengths, Weaknesses, and Opportunities & Threats) has been used in strategy planning sessions for businesses and non-profits. In today’s environment SWOT is a tired approach that no longer provides the most effective results.

    The reason is that 50% of the SWOT process keeps organizations looking in the rear view mirror
focusing on trying to fix weaknesses and swat away real or imagined threats. Unfortunately, it keeps most organizations stuck in the status quo and saps the energy and enthusiasm necessary to move forward.

    A more appropriate strategic planning model for today’s times is based in the positive organizational psychology movement called Appreciative Inquiry (AI). The AI approach assumes that in every organization there are things that are working. By focusing on improving what is working it energizes and engages those involved to a point where the improvements created make the weaknesses irrelevant.

    In the AI world a process focusing on Strengths, Opportunities, Aspirations and Results (S.O.A.R.) is applied to the strategic planning sessions creating a culture that is energized, engaged and enthused to move towards the desired outcomes developed during the process.

    Imagine if the leaders and key players of your company spent a couple of days focusing on the future aspirations for the business and the type of results that must be achieved to fulfill those aspirations. What are created by a process like S.O.A.R. are specific actions to move a company forward.   

    Regardless of what planning process is used it is vital in these challenging times that some planning process is in place. Many businesses just keep doing the same thing from year to year and come face to face with challenging economic times and do not have the flexibility to make adjustments.
A regular strategic planning process will allow market conditions to be addressed on a regular basis. From there adjustments can be made accordingly to maintain progress towards company aspirations and results.

    With two months remaining now is the time of year to begin evaluating results and making adjustments for 2009. Unless your business is one in which the holiday season makes a difference commit to scheduling time to review 2008 and create a comprehensive strategy for 2009.

Download "The Appreciative Inquiry SOAR Process is the New SWOT for Strategic Planning" in .pdf version