Intentional Strategic Planning
Choose Your Process Well
If you are struggling through how to handle strategic planning this year you are in good company.
As a professional strategic planner, it is gratifying to see that not many banks are choosing the option of pushing off their planning efforts but there is an alarming amount of institutions that believe their current plan is obsolete. It is worrying to think that so many strategic plans are viewed as unable to pivot with the current environment.
Chris Nichols, Director of Capital Markets at CenterState Bank N.A.[1] was quoted recently as saying, “If a bank had their strategic planning process correct to begin with, they wouldn’t need to change a thing. The only thing the pandemic did was speed up some trends taking place already.”
The current tumultuous environment and its associated asset quality deterioration will certainly hinder a bank’s ability to improve profitability – but it is not insurmountable – nor is it anything new. At its core, banking is the business of risk management and has been dealing with harmful external market impacts long before even the Medici’s came along in the 15th century. The problems change shape over time but always come back to maintaining a business model that correctly manages the risk – not avoids it.
If you think your plan is irrelevant in the current environment determine why it has not performed as expected. I have found that the process used is usually to blame for an underperforming plan. There are a lot of planning models out there and some great ones that can be adapted to fit the needs of your institution. What works well for one organization could be frustratingly futile for another. Find the established process that complements your team’s communication style and decision-making method. The most successful strategic planning endeavors occur when the process is in alignment with how the team naturally interacts.
The correct process should be focused on getting the right people to ask the right questions. This includes involving those who will be implementing the plan. Too often we develop tactics in isolation from those that will execute the plan, unknowingly setting up teams for failure. Planning techniques that incorporate multiple levels of pre-session communication benefit from a deliberate and purposeful preparation method targeted to prepare contributors and enrich participation.
Just like your process must complement your team’s individuality so must the tactics you choose to support your strategy. It is important that all tactical initiatives are fully vetted for their relevancy to the organization-wide strategic objectives prior to pursuing. I have seen extraordinarily successful groups pen disastrous plans because their strategies were not realistically supported by their tactics. Strategic planning is not a competition for the best strategy – it is a competition about results. At its core, your strategy is probably remarkably like a lot of your peers. If you want strategic success, ensure the tactics you choose are relevant and innately pragmatic.
Successful strategic planning is a highly structured process that creates a series of practical and progressively detailed steps, leveraging the strengths of your organization to achieve your profitability goals. Whether you are starting from scratch or refining your approach it is all about the process.
Choose your process well.
[1] CenterState Bank N.A. is a 39 branch $34 billion institution headquartered in Winter Haven, Florida.
