Tag Archives: strategic planning

Strategic Assessment of Future Threats

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ocean wave crashing
Assessing threats helps leaders and organizations plan for congingencies. You may leave port in the morning with smooth waters, but by noon, you may face rough seas. Identifying potential threats makes them less scaryl
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While there are a variety of areas an organization can look at while assessing strategic threats, one will quickly find threats often parallel opportunities. Like opportunities, assessing strategic threats is an exercise in evaluating external factors impacting your operations, funding sources, liabilities, or prevent your ability to take advantage of opportunities or create a competitive advantage. While strategic assessments do not occur in any specific order, evaluating threats after identifying strengths and opportunities helps an organization focus on threats targeting potential directions identified when assessing strengths and opportunities. Areas to examine during this part of the analysis include:

  • Government regulatory changes
  • Changes in the marketplace
  • Price trends on sources of revenues
  • Changing costs of resources
  • Emerging technology and scientific advances, and
  • Competitor activity, and
  • Industry trends.

While the US Government is currently going through tremendous change and is making daily headlines, it is nothing new. Changes in government anywhere in the world are common. In this analysis, examine the negative impacts on current and potential future operations. For example, by identifying changes in tax policy that increases your tax liability, you can identify changes addressing those issues.

Consumer demand is always changing. Thirty years ago. Sears was the unchallenged leader in direct sales. With a history of selling remotely directly to consumers through their catalogs (everything from house kits and tractors, to toys, and clothing), they were in a perfect position to take advantage of new internet technology. If their leaders recognized the opportunity on-line shopping offered, people would still be buying Craftsman tools from Sears. Instead, the internet became a threat to their continued existence as Amazon boldly filled the void. The Sears story is a perfect example of how closely tied, opportunities and threats are associated and related. For Sears, on-line shopping was an opportunity missed that became their greatest threat.

Retailers that failed to understand the opportunites presented by the internet soon found brick and mortar stores challenging. Still, many prevail because they have found a way to provide customers what on-line shopping cannot.
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Likewise, just before the rise of Amazon, came the collapse of Thee Phone Company. Consumers wanted new ways to co communicate. They wanted less expensive options. Small technology companies were being stonewalled by Ma Bell and eventually they, with the help of the government, prevailed in court for changes that led to our modern internet and communications. Bell Labs could have done more to build mobile phone technology, and provide cellular data. Instead, they chose to use their monopoly on communication to keep the competition at bay. No longer is there a single phone company because the only phone company never understood the threat of litigation, changing technology, and consumer demands.

Pricing and revenue generation are often linked. If you hold the patent on a product, you can charge top dollar for it. What happens when the patent expires? Does your product offer enough value to continue to justify high prices? When competition enters the mix, prices often become lower. However, if your product is of a quality, people will still be willing to pay more. One can buy and woodworking hand plane on-line for under $30. However, there are companies that still sell enough hand planes priced over $300 that they turn a profit. You have to know who your clients are. There are enough people still willing to purchase and tools even though power tools are faster and often more accurate.

Analyze the future cost of resources. Include all resources, ranging from the cost of wages for the people who make your organization what it is, to the raw material required to do what you do, as well as internet, computers, vehicles, fuel, property and everything else. Evaluate how changes in these costs impact or threaten the future of your organization.

Sears failed to recognize the opportunity the internet presented for on-line sales. Understand how changes in technology threaten your organization as well as the opportunities technology presents. It was not that long ago that television, magazines, and newspapers were the primary means of staying informed and entertained. Now, for little money, anyone can start a YouTube channel, write and publish a book, or start a blog. An example is my blog, written every month with naturally inspired intelligence. I need to understand the potential impact artificial intelligence has on the future of my writing and training. While I do not intend to substitute AI for my NI (both artificial and natural intelligence are both flawed, regardless of what many AI detractors say), I recognize the demand for my writing may decrease as AI writing demand increases. I will need to implement changes to remain relevant in a changing world.

man looking at charts taped to wall
Threats are only scary if you do not recognize them soon enough to create a plan. Even if a threat fails to develop as envisioned, the plan may be perfect for an different threat.
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Examine your competitor’s operations and plans. I ran a nonprofit for several years that provided services to sexually abused children. Through our work, those abusing kids would be charged criminally. It was important for us to understand the changing arguments made by defense attorneys in court and adapt your practices to stay aligned with expectations of the courts while continuing to use evidence based practices that are trauma focused. Not only was it important to hold alleged offenders accountable, improved practices also increased the probability we were collecting evidence that supported charging people appropriately. If the wrong person is arrested, the person committing those crimes is still free to continue abusing other children, and that is a big threat.

This list is not exhaustive. It is an example of topics any organization conducting a strategic threat analysis. Identify those threats that have the potential to impact your plan for the future. Find ways to mitigate those threats. Find opportunities that make those threats irrelevant. Failing to identify potential threats to your proposed future plans creates false hope for success. Knowing possible threats and having options allows you and your organization to adapt quickly and remain relevant. Doing so ensures threats are not scary, rather just part of the future.

References

  • Collins, J. (2009). How the mighty fall. HarperCollins, New York, NY
  • Roger Williams University Executive Development Seminar

External Strategic Assessments: Our Opportunities

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Karns show hikers the path in the absence of landmarks. Like analyzing opportunities, karns provide possible paths to achieve your objectives.
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Assessing potential opportunities is the first of two external assessments in the strategic assessment process. The reason for having a strategic plan is to allow everyone in the organization to focus on the most important things that help achieve the mission and vision. There are lots of shiny objects to chase. Only a few moves you in the direction you want to go. Avoid Shiny Object Syndrome by assessing available opportunities early in the strategic planning process. This helps organizational leaders identify which opportunities to pursue, which ones to leave behind, and create peace with those choices.

When I first became an Executive Director of a small nonprofit several years ago, I expected to be given a list of priorities to pursue. The direction I was given from the Board Chair was, “Go down there and take charge. I’m sick of hearing about all the problems!” The only direction I could find from reading Board minutes was to move the organization to national accreditation. I recognized this void of strategic direction as an opportunity to meet recognized industry standards, and improve the way we worked. There were lots of directions I could have led the organization, so knowing this goal was important. Accreditation provided a clear framework, allowed me to ignore those shiny distractions, and recognize real opportunities. While not a formal strategic plan, accreditation was our strategic goal. Opportunities are everywhere, but they are not all created equal. Knowing which ones help achieve organizational goals is important for success.

While you may find hundreds of opportunities during your strategic assessment, think about where those opportunities begin.
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Sources of opportunities

During this assessment, look everywhere for opportunities. Remember, as you develop your strategic plan, opportunities will present themselves in the future you cannot even foresee today. Many of the jobs today didn’t even exist a generation ago. Capture those opportunities that are easy to see and also stretch yours and other’s imaginations about opportunities you can create or may exist in the future.

When Bill Bratton became Police Commissioner for New York City, he created a system to identify crime hot spots and focus police efforts in those areas (yes, eventually COMPSTAT became synonymous with racial profiling, but Bratton began the program looking at crime data and patterns, not race. He worked with marginalized populations because they were the most affected by crime). The impact COMPSTAT had in reducing crime in NYC caused the trend of violent crime across the nation to decrease. When he became Commissioner, he promised to reduce crime. He found his opportunity in instant crime data, something that really did not exist at that time. He created his opportunity.

In his book, Good To Great, Jim Collins talks about three areas organizations can mine for opportunities. The first area is identifying what things your organization does that are great. Next, identify passions of the organization. Finally look at the activities that provide your operating revenue.

How to narrow opportunities

If you lead discussions about opportunities well, you will find you have far more opportunities than ability to follow. Collins discusses examples of companies redefining themselves broadly or more narrowly. Use the opportunities you identified in the three areas exercise, create a Venn diagram, one circle for each area. The opportunities that overlap are likely keys to achieving your organizational values, vision for changing the world, and achieving your strategic goals. The opportunities that are common to each of the three circles is the starting point for developing your strategic opportunities and goals.

Narrowing down your opportunities to a a strategic few helps everyone focus on the most important things to achieve success.
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Refine your opportunities to match current or future strengths. As you look at opportunities for the future, identify strengths are you lacking and how you will fill those need. Identify the current strengths you do have to leverage, acquiring those you need. As you match strengths to opportunities, find those that create synergy. Synergistic connections excite your client base, your employees, and your investors.

Narrowing the field of opportunities is important because chasing too many, causes the organization and the people in it to lose focus. Depending on the length of your timeline, you should limit your strategic goals, based on opportunities, to one to five. More than five, and everything seems important. When everything is important, then there is no focus on what actions, tasks, purchases, training, hiring, and similar activity has the priority. You end up chasing every shiny object and fail to make progress on any of your goals. One big goal that is achieved, is better than five super sized goals that never become reality.

Narrowing down your opportunities to a strategic few helps everyone focus on the most important things to achieve success.

Review

Identifying opportunities is one half of an external assessment in a strategic evaluation. In this process, examine lots of opportunities. Use the model of your passions, greatest qualities, and revenue drivers to list opportunities. Narrow your list by finding common opportunities in each of the three areas. One to five opportunities are ideal to pursue. These become your strategic goals. Failing to focus on only a very few opportunities causes people in the organization to be confused about priorities. Not every opportunity is right for your organization. What you will find, with disciplined focus and priorities, is you will easily recognize strategic opportunities that emerge along your path and propel you forward, passing shiny objects become easier. Successfully completing this part of your strategic assessment improves focus and success.

References

Good to Great

Flawed

Turnaround

Roger Williams University Executive Development Seminar

The Strategic Planning Cycle

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(Author’s note: this article is the second in a series on strategic planning using the SWOTAR model. This post also shows the importance of getting something done, even if it isn’t perfect. You might notice a spelling error, or perhaps a missing comma or double word. If I waited until this post was perfect, or even better, February might be half over. Given that an imperfect plan delivered on time is better than a late but perfect plan, and this series is about, perhaps an imperfect post delivered on time shows the importance of punctuality, if if the product is not perfect.)

Before diving into the SWOTAR model to collect information to develop a strategic plan, understanding the planning process is important so you execute your collect effectively, with the right people, so you end up with a workable plan in the end. If this is your organization’s first plan, SWOTAR is an great entry point to the cycle. If your organization has had one or more strategic plans that failed to achieve the desired results, this review improves your chances of success. Continuing with the map analogy, left in the glove box, a map is a useless tool to help you find your way. Likewise, a strategic plan set on the top shelf of the Chief Executive’s office bookcase is just as useless. Everyone, yes, EVERYONE in the organization needs access to the strategic plan. Execution of a strategic plan is an organizational, not an individual responsibility.

In the Army, units always attempt to get full size, full color maps for all their key leaders. Every vehicle driver has at least a strip map showing key points along the route and just off the route to help them reorient when, not if-when, they stray from the main route. Senior leaders in effective Army units know that unless every Soldier knows how to go from the current location, to their next objective, not every Soldier will arrive ready to execute the mission. Things happen. Soldiers become separated from the main body, enemy action makes the main route unusable, a driver makes a wrong turn and everyone else follows. If everyone has some access to location finding information, maps, they can find their way using alternative routes to arrive at the objective and provide the commander with enough troops to accomplish the mission.

Likewise, when orders are issued, commanders brief their followers with the objectives of their higher headquarters and tell all their units all the expectations of each with the leaders from each of those units present at the same time. By understanding the whole operation, junior leaders rapidly adjust to changes. Strategic plans work the same way.

Strategic plans are an organization’s military operational order (OPORD). Leaders at every level understand the overall strategy. This helps them create effective plans for their teams to support the big picture. Each individual knows the part they play in helping the organization succeed.

Too often poor leaders justify holding such information from their followers with such arguments as, “they don’t need to know; it will only confuse them,” or “they just need to do what I tell them to do.” Those leaders then wonder why they fail to get results. Remember, few people come to work daily with a desire to fail. Most people want to be successful at their job. They want to know their work has meaning. Helping workers understand what work must be accomplished to make the organization successful, and what quality work looks like enables them to better prioritize the tasks and find ways to improve the execution of those tasks.

Because strategic planning is a cycle, there is no first step, just a next step. However, if your organization has never planned for the future, assessing where you are and where you want the organization to be in the future, is a good place to enter the cycle. SWOTAR is nothing but an assessment model.

Everything else in the strategic planning cycle, figuring out what to do to make your vision of the future a reality. The strategic planning cycle continues with creating a mission and vision for the future. Next you develop steps to enable action that begins to make the vision real. Along the way, measure the success of processes to ensure they are working correctly, and the effectiveness of those processes to move you toward the vision. Because strategic planning is time-bound, the last step before assessing for a new cycle is to evaluate your successes.

In this assessment, determine what you achieved? Ask if your achievements resulted in the end state you envisioned? If your organization made the progress desired, what does the next level look like? All these questions create the data you will need for the next SWOTAR process.

Strategic planning is a continuous process. Identify your strengths, weaknesses, opportunities, threats, aspirations, and results desired. Next create actions plans to determine what actions you need to take to make your aspirations and desired results reality. Take action based on the action plans. Assess your processes and effectiveness. Finally, evaluate if you landed where you planned, then begin again.