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    Strategic Planning is Nonsense

    Unraveling the strategic puzzle: navigating the divide between strategy and planning

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      Picture of Vaughan Broderick

      Vaughan Broderick

      The ‘strategic planning’ jargon has been bandied around for decades.

      You can combine the word strategy with any other word to make it sound more valuable and important.

      You’ve heard them all before:

      • Marketing Strategy
      • People and Culture Strategy
      • IT Strategy
      • Sales Strategy etc. etc

      Today, we’ll discuss the difference between strategy and planning, a simple ‘winning strategy’ case study and how to avoid the ‘strategic planning fallacy.’

      Let’s dive in!

      🧠 The Difference Between Strategy and Planning

      Strategy and planning are two separate things.

      ‘Strategy is a set of integrated choices about where you will play and how you will win by serving customers better than anyone else in the same playing field.’ – Roger Martin.

      Planning does not have to have any integration or cohesion, nor does it describe how you will achieve the goal.

      Planning is a list of things you want to complete, like; improving employee retention or opening new stores.

      Therein lies the kernel of strategy and why planning is not a strategy – comfort and control.

      Planning is comforting because when you plan, you are the customer and control the behaviours and costs.

      With strategy, customers are the customers who decide what happens, not you.

      In other words, outcomes from the strategy still need to be determined and can’t be proven in advance.

      This is why we need the courage to design a strategy (choices) and then set about testing, gathering evidence and iterating towards our stated winning aspiration.

      🧐 Southwest Airlines Winning Strategy

      A classic example of a winning strategy is Southwest Airlines.

      When other carriers were trying to plan their way to success, Southwest wanted to become the Greyhound bus of the skies.

      Southwest had a strategy that was different from its competitors. They had a different set of integrated choices.

      Instead of flying hub and spoke, they flew point to point.

      Instead of flying several models of planes, they only flew 747s.

      Instead of offering meals, they specialised in short distances.

      Instead of using travel agents, they encouraged online booking.

      These choices reduced costs and helped them build a winning business at a substantially lower cost than competitors.

      Southwest wasn’t playing to participate. They were playing to win.

      💪 How to Avoid the Planning Fallacy

      There are several tips to avoid the planning fallacy:

      • Recognise that the unknown is uncomfortable. Prepare yourself and your team with the mindsets, resources and capabilities to navigate uncertainty.
      • Focus on progress over perfection. Mistakes will happen, and it’s critical to acknowledge that failure will be part of the journey and is essential data for what not to do.
      • Determine ‘what must be true’ for your chosen strategy to work. By laying out the logic, you can observe what happens and iterate when more information emerges.
      • Keep it simple. Your strategy should be articulated on one A4 piece of paper: where you’re choosing to play and how you choose to win. And the capabilities and management systems you need to achieve your winning aspiration.

      Here’s the ​playbook​ to design a winning strategy.

      ⚡️ The Short of It

      Strategy isn’t planning. Strategy is a set of integrated and cohesive choices.

      It’s about choosing what to do and what not to do and understanding the necessary tradeoffs from those choices.

      And mostly, strategy is about ​designing​ and iterating your way to a winning business.

      Here are 4 bonus tools and resources that are useful and fun:

      • 💥 How to build a winning AI strategy.
      • 🔥 How confident companies do less.
      • 🤯 Did you know I once experimented with a podcast. You can find it in the free resources.
      • 🎁 Roger Martin’s – A plan is not a strategy video (inspiration for this edition).

      That’s all for today friends! 👋

      Feel free to reply to contact me if you have any questions or newsletter requests.

      Thanks for reading and I’ll catch you next week.

      Keep future-state thinking,