After working with numerous companies to help them identify the best path for their strategic planning process, it has become apparent that organisations usually fall into one of two categories when it comes to how they approach strategic planning, and what they expect from it.
Upon further reflection of the two approaches it’s helpful to label one of them as ‘Consensus’ and the other as ‘Guided’.
Which one is suitable for you?
First up, let’s recognise that strategic planning is usually undertaken at an inflection point for the business or organisation. Due to growth, a change in management, emerging market opportunities, or a general need to revitalise an organisation, senior leaders decide they should undergo a strategic review, plan for the future, and get the team onboard for the journey.
When it comes to determining the strategic planning process a business will follow, the key differentiating factors between either the Consensus or Guided approach is often found in the degree of involvement of staff versus peremptory decisions made by the leader. Let’s have a look at each.
What is Consensus Strategic Planning?
In larger companies, or well-established organisations with multiple layers of management, it can be the case that the instigator of the strategic review, such as the General Manager or CEO, will want to create a strategic plan based on the broad input and consensus of their team.
This may require multiple opportunities for input and reflection by senior and mid-level managers to identify a range of strategic priorities and then, by consensus, determine the most appropriate priorities based on the current Vision for the organisation.
Input by team members
At times there may also be input provided by team members at operational levels within the organisation as part of the consensus-building process, and this would feed into the strategic decisions made by senior and mid-level managers. It’s a sort of bottom-up feedback process designed to ensure all levels of the organisation can feel ownership of the outcomes.
When using a Consensus Strategic Planning approach, only after there is agreement around strategic priorities does planning then proceed to considerations of operational activities, timelines and accountabilities.
What is Guided Strategic Planning?
For smaller or mid-size companies a more productive approach is often the Guided Strategic Planning model. Using this approach the business owner/founder/CEO sets the strategic direction themselves (or with some professional support) and then provides that predetermined direction to their team to guide them towards appropriate operational priorities. Hence, the label ‘Guided’.
Top-down decisions enable progress
This can work well for smaller and mid-size companies because the owner/CEO has good oversight of the whole business and operating conditions, and they are usually an integral component of business operations. While staff in these businesses may be engaged and committed, they may not have the same level of awareness of business factors – over and above that of the owner/CEO – to support their involvement in higher-level strategic decisions.
That is not to say the team shouldn’t be consulted in the overall process. In fact, there are productive methods to involve the team and encourage engagement with the strategic direction, however they are not involved with making the actual strategic decisions.
In this way the owner/CEO clearly guides their team to develop relevant operational level plans based on the strategic priorities presented to them.
Which approach is right for you?
Often the size of your organisation, business unit or team participating in the strategic planning process could be used as a key factor in determining which approach to use. As mentioned above, larger organisations offer more scope to utilise the Consensus Strategic Planning model, and indeed may require more involvement to create successful outcomes.
Whereas, smaller businesses will usually find the Guided Strategic Planning model much more direct and efficient in terms of time invested in the process.
Different yet similar
The strategic planning process means different things to different organisations. But the one constant is the desire to define the direction of future efforts and galvanise the team around those outcomes.
If you’d like to discuss options for strategic planning or explore how to facilitate strategic planning in your business you’re welcome to get in touch and arrange a complimentary consultation where we can investigate the most appropriate approach for you.
