loader image

The Typical Strategic Planning Process

If you’ve ever been involved with strategic planning, you know the drill with the annual cycle and all of its milestones, upward and downward communication of expectations, information exchanges, discussions, competitor analysis, desired projects, financial planning, and much more.  Over the course of five to eight months, all of these efforts magically culminate in beautifully strategic planning documents.

These documents contain three-to-five-year financial plans for each division and the company overall, which will be presented to the board and to analysts on Investor Day or at industry conferences. During the months of preparation, planning teams are filing templates, collecting data, and holding strategic and operative discussions at all levels of the organization.

Sometimes M&A activity can disrupt all of this work, which is a nightmare for every strategic planner as it upsets the usual “last year plus x% growth, or y% minus costs” targets, which are set top-down by management and then used to develop the SPP by the organization.

Known and Lesser-Known Benefits

Most people assume that the multi-year plan that comes out of the SPP is the true goal. Yes, it’s the official one, but the actual objective is more subtle.

The real benefit is less about the exact output and more about three items:

  • a strategic discovery process
  • internal communication
  • external communication

These benefits are achieved both during and after the process of developing the plan. In fact, I would argue that once the SPP is written, it’s safe to recycle all the paper and beautiful strategic decks at once, but save the summary of each unit’s goals and initiatives, plus some financials needed for comparison of planned vs. actual performance.

Strategic Discovery

Months of joined work across the organization create value. The SPP allows all parts of the organization to take some time outside the daily crunch to look at the company’s competitors, strategy, financials, and performance. It also frees up some time for organized and structured discussions about the future of the firm. By working together, employees set in motion an annual discovery cycle, even if many of them feel it’s just an exercise in paperwork. Ideally, the knowledge of the organization is harvested and made transparent during the SPP. This knowledge can become part of the strategic plan, either tabled for future use (e.g., bold ideas whose time has not yet come) or translated into more tacit organizational knowledge that manifests itself in daily decisions and behavior (e.g., focus on a new competitor that was discovered as threat).

Internal Communication

Inside the organization, from the C-suite to the trenches in all departments, employees get in contact with one another and learn about the way forward, especially once the plan has been communicated. They might collaborate with new or different colleagues for the first time, sparking relationships that might prove valuable in the future. Overall, the SPP is a big rallying cry for all, like a flag the troops gather around. Does it really matter whether the plan says 10 percent annual growth vs. 12 percent? Absolutely not.

External Communication

Various outside stakeholders also learn about the firm’s future endeavors. Elements of the SPP can be used to create a narrative to share with the world. Equity analysts love narratives, which in turn might help get the company “buy” ratings and potentially a higher stock price. The shared narrative also helps customers, service providers, and other suppliers to better understand what your company is about and where it’s going.

In summary, developing a strategic plan has many benefits beyond the target numbers and initiatives it generates. Unfortunately, the SPP often carries a high price tag because of its shortcomings, some seen, some unseen. In the next articles in this series, I will take closer look at perceived shortcomings and what various participants in the SPP can do to make the process both more effective and efficient.




“8Ps” of StrategyOpportunity
for Disruption
Recommended Leverage Points
Position- The farmers, individual and corporate, that you are targeting.

- The need of the agricultural industry that you seek to fill.
3- What technologies do you control that can help you tap into market
segments that you previously thought unreachable?

- What are the potential business alliances you could think about with key players in the segment to serve your customers with integrated solutions? (Serving customers with more integrated solutions example: serving farmers with fertilizers, crop protection and other).
Product- The products you offer, and the characteristics that affect their value to customers.

- The technology you develop for producing those products.
8- What moves are your organization taking to implement Big Data and analytics to your operations? What IoT and blockchain applications can you use?

- What tools and technology could you utilize or develop to improve food quality, traceability, and

- How can you develop a more sustainable production model to accommodate constraints on arable

- What is the future business model needed to serve new differentiated products to your customers?
Promotion- How you connect with farmers and consumers across a variety of locations and industries.
- How to make consumers, producers, and other stakeholders aware of your products and services.
8- How are you connecting your product with individual and corporate farms who could utilize it?
- How could you anticipate market and customer needs to make customers interested in accessing your differentiated products?
PriceHow consumers and other members of the agricultural supply chain pay for access to agricultural products.7- What elements of value comprise your pricing? How do each of those elements satisfy the varying needs of your customers?
Placement- How food products reach consumers. How the technologies, data, and services reach stakeholders in the supply chain.9- What new paths might exist for helping consumers access the food they desire?
- How are you adapting your operations and supply chain to accommodate consumers’ desire for proximity to the food they eat?
- How could you anticipate customer expectation to make products more
accessible to customers/agile supply chain?
- Have you considered urbanization as a part of your growth strategy?
- How your food satisfies the needs and desires of your customer.
- How the services you provide to agribusiness fulfill their needs.
9- Where does your food rate on a taste, appearance, and freshness
- Could the services you provide to companies and farms in the agriculture industry be expanded to meet more needs?
- What senses does your food affect besides hunger? How does your
customer extract value from your food in addition to consumption?
Processes- Guiding your food production operations in a manner cognizant of social pressure.8- How can you manage the supply chain differently to improve traceability and reduce waste?
- How can you innovate systems in production, processing, storing, shipping, retailing, etc.?
- What are new capabilities to increase sustainability (impact on the environment, or ESG) components?
People- The choices you make regarding hiring, organizing, and incentivizing your people and your culture.- How are you leveraging the agricultural experience of your staff bottom-up to achieve your vision?
- How do you anticipate new organizational capabilities needed to perform your future strategy (innovation, exponential technologies needed, agile customer relationship, innovative supply chain)?
- How do you manage your talents to assure suitable development with exposure in the agrifood main challenges/allowing a more sustainable view of the opportunities/cross-sectors?