Last week, my wife and I visited a nearby restaurant for the first time. We knew very little about it, but we had both driven by many times, so we decided to give it a try.
We walked in, went up to the host stand, and waited. And waited some more. It wasn’t actually that crowded, but it was a good five minutes before someone arrived to seat us.
It got worse. There were no utensils on the table, and it was another five minutes before our server came by to greet us and take a drink order.
I looked over at my wife and said, “Uh oh.” Sure enough, not only was the service slow throughout the rest of the meal, but the food itself was extremely mediocre (and expensive).
Of course, bad service and bad food don’t necessarily go together. But in my experience, a restaurant that permits its service to be lacking usually has the same (low) standard for the food itself. Poor service is a reliable red flag of what the future holds.
As it turns out, strategy has its own handful of red flags — things that by their very presence usually indicate a problem down the line. Here are three I’ve come across frequently…
#1. Massive Binders
Many years ago, I was hired to head up strategic planning for a midwestern regional discount department store chain. My predecessor in that role had taken the chain through a version of strategic planning that left behind several big binders with literally thousands of slides (many with fun military images, harkening back to the idea that corporate strategy evolved from military strategy).
The problem, as is often the case, was that nobody ever looked at the binders — they were too large and too intimidating for anyone to pull off the shelf and read. Yes, they contained lots of data and in-depth analysis. But for someone seeking guidance about operating decisions, there was too much to wade through to be useful.
Strategic insights need to be more than just “correct.” They must also be accessible, in a practical way, to those who need them. Big binders don’t pass that test.
#2. A Top-Down Process
Plans developed by a small cohort of “smart people” at the top, and then handed down as wisdom to the rest of the company, nearly always suffer from a lack of real-world understanding and usefulness. Absent the knowledge possessed by those who interact with customers every day, blueprints delivered from “on high” tend to fall apart when the rubber meets the road.
Further, and beyond these shortcomings, top-down plans miss an opportunity to engage those who are charged with putting the recommendations in place. Without a strong feeling of ownership — the kind that occurs when people have a hand in strategy development — these plans rarely achieve the necessary traction. (I’ve written about this specifically in past newsletters, here and here.)
#3. Broad and/or General Lists of Goals
When I arrived at the discount department store, they had one overriding goal: Continue to increase revenues through market expansion and the building of new stores. In effect, this was a multi-year budget process, founded on the assumption that building more of what we already had would continue to be successful. Unfortunately, given the anticipated changes in the competitive market, this was not a good assumption.
Another approach I’ve often come across is no better: Strategic plans that are just a laundry list of goals — sometimes as many as 10 or 12 of them — with little detail about how, specifically, those goals are to be met. In addition, many are often too general in nature to be of any practical value (improve profit margins, raise customer service performance levels, etc.).
Goals are not by themselves a strategy — they are outcomes one might achieve if you have a good strategy and execute it well. How is success even measured with this approach? Is achieving 7 of 10 of these “good enough?” Are all goals of equal importance? What does it mean to fall short of one of the most important goals?
Either way, having one generic goal (e.g., growth based on the status quo) or a basket of vague wishes are both losing approaches. Rather, what’s required is having clarity on what makes your organization different, coupled with one or two critical objectives that will support that differentiation. That’s what allows you to focus your actions and resources on activities that matter most to your organization.
Reflections
Strategic plans fail for predictable reasons; the red flags are usually visible long before the damage is done.
Massive binders nobody reads, top-down directives that ignore the people closest to the work, and laundry lists of goals masquerading as strategy, all share a common flaw: they prioritize the appearance of planning over its actual purpose.
Knowing what bad strategy looks like is the first step toward building something better.
