Ten reasons why the One-Page Strategic Plan created by Verne Harnish, author of Mastering the Rockefeller Habits improves a company’s performance
By Kevin Lawrence (Coach Kevin)
Remember the back of the napkin – the one where you doodled your first business plan? Or perhaps it was a whiteboard in windowless room where you fervently scrawled your ideas on how to change or dominate your industry. Regardless, it was that one page that helped bring your business, or ideas to fruition.
It doesn’t matter if you’re a CEO at the helm of established organization or an entrepreneur who created a company from the ground up, I’ve seen many business leaders develop extraordinary ideas on the back of a napkin over lunch meetings – and probably more over a dinner late into the evening. The point is – there’s a remarkable sense of clarity that comes from creating a strategic plan that fits on one page.
Equally important, is what happens next – everyone leaves energized and on the same page, off to execute on the plan or idea with a clear purpose. And even if they don’t have the napkin in front of them, the image of that plan is burnt in their mind. The challenge for executives becomes how do you sustain the momentum?
For CEOs of smaller-sized companies who are not at the mercy of the bureaucracy and complexity of larger organizations, this is less of a challenge. But what happens when there are 10,000 different versions of that plan-on-a-napkin, representing every employee’s individual interpretation of the plan?
Oftentimes, business leaders are too focused on steering their ship through day-to-day hurdles, and as a result, they lose sight of company’s vision and goals. I also see many leaders who become extremely tactical and short-term focused, causing them to miss out on the opportunities that made them successful initially. This can be detrimental because when leaders lose focus, so do employees. The result? Everyone is executing his or her own version of what they think is the plan, which is absolutely scary and certainly not good for business.
Instead, winning requires leadership teams to create a strategic plan that is easily understood, communicated and championed. This is why I encourage my clients to use the One-Page Strategic Plan by Verne Harnish, author of Mastering the Rockefeller Habits, because it takes a laser-focused approach to capturing all the important business strategy components – from core values and measurable targets to who is specifically responsible for accomplishing the top priorities each quarter.
The One-Page Strategic Plan makes the difference between companies that prosper and those that unfortunately tread water and here are ten reasons why; business leaders who use the One-Page Strategic Plan:
1. Get clear on who they are as a company and where they want to be in ten years. For many leaders, it may seem like daunting task to develop a long-term vision but with the One-Page Strategic Plan, leadership teams work through smaller, action-oriented components, which in the end establish the company’s vision and the plan to get there.
2. Identify the biggest opportunities and obstacles ahead for their business. The only constant is change and if your company is not agile to changes in the market, it will become irrelevant. Putting a bunch of smart people in a room on a quarterly basis ensures that the biggest opportunities and obstacles are identified and debated regularly. This is crucial because you don’t want to miss opportunities or unexpectedly face obstacles.
3. Build a shared conviction and greater commitment to the strategy. Having a plan is imperative, but it’s also important that those executing it are in agreement and committed to making it happen. The One-Page Strategic Plan process helps business leaders:
- Understand one another better, which improves camaraderie and contributes to diversity of thinking, greater collaboration and the generation of better ideas;
- Break down barriers and silos that existed between them or their business units, leading to ideas that are less likely to benefit only one department, but instead improve the success and cross-fertilization of ideas across departments;
- Establish a shared conviction and therefore they buy into the plan because they created it together in the first place.
This all leads to a greater probability of success, regardless of whether or not the plan is perfect.
4. Enrich their leadership capabilities. Leaders (and employees) get the chance to drive major priorities, giving top executives the ability to see how their key talent handles and delivers on major initiatives.
For example, one of my clients needed someone to drive a major project and when an employee volunteered, executives were skeptical because they didn’t believe he had the caliber of leadership required. Well, to everyone’s surprise this employee was stellar throughout the project, and in fact, established himself as one of the best leaders in the company. The perspective went from “yeah he’s a good guy” to “wow, he is amazing.”
Seeing who volunteers to lead initiatives is really quite important because:
- Your future executives are typically the people who volunteer for strategic projects, which helps greatly with succession planning;
- The executive leadership can witness their ability to deliver on initiatives, which provides insight into who is ready to move up the organization;
- Future leaders benefit from greater interaction with the top tier; and
- Employees who deliver, grow significantly in their leadership capabilities.
Now, some employees (and leaders) will not be able to deliver, but ideally, if this process is applied correctly, senior executives will be able to use project leadership as a litmus test to determine who is capable of assuming greater responsibility.
5. Inspire employees with a crystal-clear vision that reinforces why their efforts everyday matter. Employees have desire to be a part of something that is exciting in terms of the impact a company makes and the success it can generate. The One-Page Strategic Plan reinforces across the organization why the company matters, where it wants to be in ten years and what must happen each quarter to achieve that goal. This will without a doubt focus and energize employees.
Many leaders also engage their employees at a grassroots level to help determine how to accomplish priorities. For example, if the goal is to eliminate $10 million in expenses, by soliciting employee feedback on where to reduce costs, employees gain greater ownership in the goal. Additionally, the opportunity for success improves because employees are often the first to know where money is being used inefficiently.
6. Unleash a culture that empowers employees with responsibility and accountability. Human beings are easily distracted and generally have a hard time following through on challenging projects. Put another way – if you know you have a year to work on a project, typically, you will only focus on it during the last 30 days (that’s assuming you remembered to do it because you were given it 11 months ago and it’s amazing how fast things fall off our radar).
The One-Page Strategic Plan creates a culture of discipline because priorities are reviewed in 13-week intervals, which causes an innate urgency to get projects done. I have seen time and time again that companies get at least twice the amount accomplished when priorities are evaluated four times a year versus annually. Furthermore, if the plan is done right, employees will know exactly what the three to five priorities are, and ideally everyone will be associated in some way with the number one priority. Employees will also be empowered to say no to non-critical requests that are not tied to the company’s top priorities.
7. Eliminate priorities that simply don’t fit with the company’s strategic direction. If you don’t have a formal process for determining quarterly priorities, how do you know if your employees are working on critical initiatives that are actually moving the company ahead? Even worse, what happens if employees are working on initiatives that are detrimental to the business’ success? The One-Page Strategic Plan helps leaders identify quarterly priorities that are congruent across the organization, reducing the likelihood that employees just pick ones they think are important but that may not be beneficial.
8. Uncover hidden issues that are inhibiting success. After 12 to 18 months of executing quarterly priorities, many previously hidden issues become exposed and dealt with, which means the company can move into a position of greater strength because executives are able to notice new opportunities they didn’t see before. For example, I often see situations where newly appointed leaders join companies only to discover a plethora of issues, and the longer they are there, the more they find.
Creating a rigorous process for establishing and measuring quarterly priorities surfaces issues, aligns leaders and focuses the business, which over several quarters, results in less emergencies to address and fix. Consequently, leaders can capitalize on new opportunities leveraging the strength in what the company has built.
9. Generate momentum that is similar to the Flywheel effect – a concept introduced by Jim Collins, author of Good to Great, Built to Last and How the Mighty Fall. According to Collins,“Good to great comes about by a cumulative process – step by step, action by action, decision by decision, turn by turn of the flywheel – that adds up to sustained and spectacular results.
Considerable momentum can be achieved if every business unit focuses on making notable improvements on five key things each quarter. Additionally, imagine how incredibly powerful it would be to have every employee focusing his or her efforts on making a single, but significant, improvement for the business, for example, increasing units sold per month.
10. Communicate with clarity and engage in a consistent two-way dialogue with employees on the strategic plan. Once business leaders have a clear vision of the company’s direction, the opportunities and obstacles and the top priorities that need to be accomplished each quarter, they are perfectly positioned to engage employees in helping to achieve the priorities. Employees are typically hungry for information on the company’s goals and performance, particularly in industries facing ongoing change and competitive pressures. By improving the flow of communication, employees will better understand each individual, team and business unit’s priorities and contribution to the strategy. As a result, they will be more willing to explore ideas that benefit the entire organization rather than just themselves personally.
Improving communications based on a clearly articulated One-Page Strategic Plan will also decrease the all too often experienced communications gap between the executive leadership team and front line employees who ultimately work every day with customers, partners and suppliers. I have yet to see an employee tell me, “my CEO communicates too much.” Instead, it’s usually the other way around with employees often sharing:
- “I don’t know the strategy for our company or how we are performing against it.”
- “We never hear from our CEO or executive leadership team. It would be great to see them walk the floor once in a while.”
- “I wish they would ask me for my feedback; after all, I’m the one that works everyday with our customers.”
- “It would help if I knew what our targets were each quarter.”
When I work with clients on the One-Page Strategic Plan, I strongly encourage them to develop a quarterly communications plan alongside the quarterly priorities where timeliness and transparency of information rules. I also encourage them to engage in a healthy debate and two-way dialogue with employees. Why? Well, if employees can challenge ideas or potentially bad decisions, two things happen. First, it builds a strong culture of collaboration and diversity of thinking beyond the senior leadership team, which means the generation of better ideas across the organization. Second, if employees contribute to the decision-making and idea creation process, they too will have a greater sense of ownership in the priorities and the outcomes.
The most effective way to plan and get plans executed
In my coaching practice, I have had the opportunity to use many different tools to help companies improve their performance; yet, I have voluntarily chosen the Rockefeller Habits methodology, created by Verne Harnish, because it is by far the best set of tools and techniques available to help businesses sustain positive and profitable growth. The One-Page Strategic Plan is also, in my opinion, the most effective way to plan and get plans executed in a way that improves a company’s performance.
All too often business leaders are so caught up in all the urgent but not important stuff that they lose sight of the company’s purpose and goals. Creating an action-oriented strategic plan based on quarterly priorities keeps short-term priorities top of mind throughout the organization, while helping companies achieve the long-term vision. It also reinvigorates and motivates employees by demonstrating how their day-to-day efforts matter and contribute to overall success.
Now, this is my perspective, but don’t just take my word for it. Verne’s book, Mastering the Rockefeller Habits is filled with testimonials from executives around the world who have shared how these techniques have made a lasting difference in their organizations. If you’re serious about accelerating positive business performance, don’t miss out on the dramatic results that can be achieved using the Rockefeller Habits methodology or the One-Page Strategic Plan.
Kevin Lawrence is a strategic advisor and coach to CEOs and executive teams across North America and internationally. Driven by a relentless passion for helping business leaders get what they really want, in business and life, Kevin has coached clients across a wide range of industries, including consumer packaged goods, manufacturing, luxury retail, media, automotive and professional services. He deeply believes that CEOs and entrepreneurs can have tremendous business success along with an enriching, adventurous and fulfilling lifestyle, taking their professional and personal accomplishments to an entirely new level.
For more than a decade, Kevin has helped clients overcome major obstacles, deal with tough decisions and capitalize on new opportunities to generate breakthrough results. Clients often turn to Kevin when they are faced with a frustrating and challenging issue, which causes them to seriously look at making a big change, quickly. His methods, style and savvy approach have helped his clients expand into new markets, build high performance leadership teams, attract profitable clients, improve productivity, and increase revenue and profitability. Also, with Kevin as their advisor, clients reduce their stress and hours worked so they have more time and energy to live their personal version of an outrageous quality of life. For more information, visit www.CoachKevin.com or call 1-877-564-6224
Copyright 2010, SGI Synergy Group Inc. & Kevin Lawrence