The science behind strategic planning

Francesco Marcatto8 May 18

Very often organisations, from small to big, spend a lot of time in strategy meetings (ie., deciding what’s our next big goal), but then they just don’t do enough to implement their strategy.

![Strategy - something magic happens - execution](
It’s the common strategy-execution gap. An intermediate layer, we call it **strategic planning**, can be extremely useful for bringing your team on the same page and showing all the big picture. You show them all what’s important to do and why, set (realistic!) deadlines, and periodically track your outcomes, it’s not so hard and has multiple benefits for your business.

Lack of clarity and focus, procrastination, investing a lot of effort in activities that don’t move the business forward but trick us in feeling ‘productive’, loss of motivation, working at cross purposes... I don’t go so far as saying that strategic planning is the final solution to all these problems which are commonly found in organisations of all sizes, but for sure it could help.

There are many reasons why strategic planning is so effective. Here I’ll review some of the research findings which explain the usefulness of strategic planning.

Motivation and Productivity

We all are always busy, nevertheless we struggle to move our business forward. This is the busyness paradox: the more overwhelmed we feel, the more likely we are to do stuff that keeps us busy, but not productive. Replying non-important emails, for example, make us feel productive, even if it distracts us from doing what really needs to be done to move the needle for our business.

There are at least two causes of this problems, our innate tendency to procrastinate what is hard to do or we just don’t like, and the lack of explicit priorities, and both can be tackled by accurate strategic planning.

Implementation intentions for beating procrastination

It’s hard to close the intention-action gap. We make plans, but then we often fail in executing them. From not attending gym classes to postponing that cold-call to a potential new customer, we often put off important tasks. Yes, procrastination.

Research says that the best way for beating procrastination and narrowing the intention-action gap is to form implementation intentions. This means that we should create in advance an explicit plan that spells out what we will do in order to pursue our goal and stay on track. We have to define when, where, and how we want to act on our goal intentions, and if possible even plan out in advance and how to react to critical situations. This way we increase the likelihood of actually executing the goal-directed actions, even in situations of high cognitive demand.

Better prioritisation

During a standard working day, we usually have a lot of things to do. Some are very important, many are just trivial tasks. What should be done first? How should I schedule my tasks for the day or for the week?

According to the popular Eisenhower matrix, important and urgent tasks should be done first, and you should always set aside some time for the important but not urgent tasks.

Eisenhower matrix

Why is it so hard to work on what’s important? Very often it’s because it’s not clear what the priorities are. If we don’t have an explicit and shared map with our priorities, we have to rely on our memory of the old strategy meeting and on our own evaluations. But our memory can be misleading and our evaluations can be very different from our colleagues’ ones, but it’s hard for us to realise it (due to a cognitive bias called the false consensus effect).

Strategic planning can be very useful for making the priorities explicit: a well-crafted visual strategic plan shows the important activities only, so at a glance all your team will understand which are the things they should focus in order to move the business forward. Anything not included in the strategic plan, including all the nitty-gritty stuff such as fix bugs, reply emails, and so on, has a lower priority and should be done ‘when there is time’.

Better communication: bring focus and alignment to your team

When managing a team, finding the right balance could be very difficult. On one hand, micromanagement can satisfy our inner ‘control freak’, but is demeaning for our team and, in the end, extremely inefficient. On the other hand, giving vague instructions could lead to inefficiency: employees don’t understand exactly what they have to do, have to guess what’s more important and what instead could be delayed.

According to an Interact/Harris poll conducted with 1,000 workers, the second most common communication issue at work is not being given clear directions from their managers. This is not so strange, since it has been estimated that up to 95% of employees at mid-size to large companies are unaware of, or don’t understand, their company strategy.

You can easily imagine the consequences: misalignment, frustration, working at cross purposes, lack of focus, poor productivity, and so on.

Visual strategic planning can be a powerful tool for effectively communicating your strategy, providing clarity and bringing your people on the same page.

Use the Commander's Intent and stop micromanaging your team

The core idea behind the Commander’s Intent (CSI) is that, rather than apply tight command and control, leaders should provide a clear sense of the outcomes they seek and the parameters they will accept. In other words, you should tell your team where you want to go and why you need to get there and leave them free to use their skills and knowledge to reach the desired outcome.

This smart communication tool has been developed by U.S. Army to help them plan in the face of extreme uncertainty, and it’s very useful in business too: it then doesn't matter if something unexpected occurs, with the CSI your employees will be free to improvise and take initiative to reach the desired goal anyway, instead of just freezing or calling for another meeting.

Strategic planning is the layer between high-level strategy (usually too vague to be actionable) and day-to-day tactics, so it’s exactly the right level for using the Commander’s Intent.

Here’s a template for starting to use the Commander’s Intent right now in your startup:

Our goal is to ............................................................ because ............................................................ and we have to do it before .............................. .

Success would be ............................................................ .

It would be okay if ............................................................ .

We need to reconsider if ............................................................ .

If you’re using I Am Why for strategic planning, you’ll find that all the stuff you need for create a CSI that really delivers is already there, just click on a bar of an activity to open it and fill out the fields.

The fine art (and science) of goal setting

One of the most useful skills for any leader is the ability to point out the right objective. For all of us who are not born already as leaders, there are some easy rules we can follow when creating a new goal for our team.

Rule 1: Focus on what you want to achieve rather than how to reach it

If your goal is just a to-do list, then you’re doing it wrong. Describe what the desired final state is and why it’s so important, this is the main lesson of the Commander’s Intent.

Rule 2: Write for the others, not just for yourself

Communication can easily be destroyed by a very frequent (although too often overlooked) cognitive bias called the curse of knowledge. According to it, when communicating we unknowingly assume that the others have the background to understand. In other words, recipients get maybe 60% of the original message, while we are sure that they got 90% or more of it. You can’t expect focus and alignment if your teammates just don’t understand your plan and, as a team leader, is your duty to send out clear messages. Beat the curse of knowledge by using a simple (but not simplistic, you’re not communicating to preschoolers!) language and, more importantly, keeping in mind your teammates (how they call things, what they already know and what information could be missing, etc.).

Rule 3: Use SMARTER Goals

The principles of good goal setting, according to the Management by Objectives criteria developed by Peter Drucker, can be summarised by the SMART acronym. Therefore, a good objective should be:

  • (Easy to) EVALUATE
  • (Easy to) REVISE

Rule 4: Avoid Stretch Goals

Many companies like to aim very high and set ‘stretch goals’, very ambitious objectives that are unlikely to be reached but should motivate employees into pushing their limits and performing at 110%. Research says the opposite: although in some -very rare- situations stretch goals can be useful for dealing with new challenges that require innovative approaches, they are usually very dangerous and can backfire to disastrous ends. So do your company and your teammates a favour and set goals that can realistically be reached.

Cognitive benefits

Visual Planning = Better understanding, with less effort

It is said that a picture is worth a thousand words. Research agrees with this common wisdom: according to a phenomenon called picture superiority effect, we respond to, process and remember visual data better than any other type of data.

Finding the right information on a long text document is a costly process in terms of time and cognitive resources (especially attention and working memory), while the same process using visual content is faster and cheaper, thus leaving our precious cognitive resources free for what’s really important, such as starting to get the important things done. This means that if your strategic planning is a long text document or a big spreadsheet, then well, you’re placing an extra cognitive burden on everyone who should read it and act on it.

Strategic planning deals with complex and multidimensional data (numbers, goals, activities descriptions, deadlines, hierarchies and dependencies, etc), so using a visual way to map out your strategy will make all that complex information more accessible, understandable, and, most importantly, usable. Indeed, not only does our brain process visual information more effectively than text, visuals are also more persuasive.We know, in fact, that using visual information can make a presentation 43% more likely to get the participants to take action than without visuals.

Let’s get rid of the planning fallacy

It’s hard to accurately forecast how long will it take to accomplish a project. We are usually too optimistic, so when planning how long will take us to complete a project, we systematically underestimate the total expenditure of time. This happens for big projects (the building of the Sydney Opera House, for example, took ten years longer than expected, and cost $ 102 million instead of the estimated $ 7 million) and small projects (writing this article took me a week longer than planned) too.

This widespread cognitive bias is called planning fallacy, and was first reported by the dynamic duo of cognitive psychology Daniel Kahneman and Amos Tversky already at the end of the 70s.

Although admittedly hard to completely overcome, there are some ways visual planning can help in debiasing the planning fallacy and create more accurate forecasts.

Visual vs. abstract representation of time

Seeing your project on a timeline is dramatically more effective for taking an outside view and understanding the passing of time than just imagining it. For example, you can see that a month doesn’t last forever but has a fixed number of working days, and you can see also that there are already some planned activities that will overlap in the same period, so it’s better to be more cautious and move the deadline to a later time.

The segmentation effect

Another effective debiasing technique of the planning fallacy, consists in breaking down longer activities into smaller sub-tasks. This is one of the core ideas of I Am Why: on the timeline view, you can break down your big objectives into the main activities that will make you reach them, and then those activities into weekly tasks. This way you should be more accurate in forecasting the time needed for each activity.

Empowerment and well-being

Research on work-related stress has identified lack of control (not being able to decide how to do our own tasks), unclear roles (not knowing what to do and why), and poor support from management as some of the most common and dangerous workplace stressors.

Strategic planning, through the use of the effective communication (eg., the Commander’s Intent) and clear prioritisation, can improve employees empowerment and engagement: When given a chance to decide how to get done their work, employees increase their productivity and are also motivated to find innovative solutions to complicated problems. And more in general, employees who know what to do and why, are employees who work better, are more productive and engaged, and are less stressed and more happy of their job.

Mindiply, the tool for effective planning

In sum, investing in effective strategic planning means investing in productivity for your company, but also in employees’ well-being. It’s a clear win-win situation.

We are developing Mindiply trying to implement the relevant findings from research in cognitive psychology and organisational science, with the aim of helping big and small businesses in developing their strategic plans in a visual way. Mindiply makes things clear for you and your team: your whole plan, from project to task level, is always right in front of you. An easy way to communicate and share your strategy, for keeping your teammates aligned, productive, and maybe even happy. You can sign up for early access to Mindiply here!

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