First You Take a Vacation…

Almost every year for the past 20+ years, my wife, Anne, and I have spent the last week of July with various members of our family sitting on a rock known as Star Island ten miles off the coast of Portsmouth, NH in the Isles of Shoals. As rocks go, it’s a pretty big one — 240 acres — but as islands go, it’s pretty small. If you can avoid the predatory seagulls, you can circumnavigate it by foot in just over an hour.

We return annually for The International Affairs Conference, an experience that more than a few have characterized as “summer camp for adults.” Offered under the umbrella of the Star Island Corporation, “I.A.” grapples each year with a different major international issue: this year it’s the role of Water in the global climate system. Theme speakers drawn from government agencies and NGOs as well as academia and the media will address the topic from geographic, political, social, economic, and historical perspectives, which probably takes care of the full range of presentable perspectives.

But none of those is really the perspective that most interests me. I love the perspective of sitting in a rocking chair on the broad front porch of the Oceanic, the old frame hotel building, looking out over Gosport Harbor while watching the sun set and the moon rise, listening to the wind, the waves, the gulls, and the occasional foghorn. It’s the one time of year that I am forced to slow down — no phones, no Internet, no TV, and when newspapers do arrive, they’re often a day late. The world goes on, and I stop. And I have discovered that my stopping doesn’t make any difference to the world.

What does make a difference to me, however, is that my brain cycles into a different realm. Instead of confronting the week-to-week challenges of my clients, I am encouraged by the plenary sessions and break-out groups of I.A. to think much more broadly, often about matters that confront us as a species. And when you’re ten miles out, amidst the elements of nature, you’re not far from existential issues.

I invariably come back from Star Island recharged, though sleep-deprived — those gulls wake up early! For a few weeks thereafter, I view my client companies through a different lens: one that’s longer term, perhaps more existential. Where is this company going? Are they really making progress?

Post-vacation is the time to take a fresh look at things, to begin what my home improvement client Moonworks (Woonsocket, RI) started on a pre-vacation basis last week by gathering its senior management team to initiate a strategic planning process. This 18-year-old reseller and installer of Andersen Windows, Gutter Helmet, roofing, siding, and insulation developed an agenda (thanks to COO Matt Weiner) which seems appropriate as a place to begin for a lot of smaller companies. What follows are the key discussion elements of this first meeting:

The Objective: To build the foundation of a plan to maximize company value within five years. Translate into Annual Operating plans to drive management activity.

The Process: Exchange perspectives on each of the major topics below leading to a statement of consensus (or differences). Identify areas requiring additional research and inquiry. Assign work items and time frame for completion. Follow up.

  1. Market conditions — What’s viewable in the five-year crystal ball, considering both the global economy and our market segment?
  1. Trends and opportunities — Can we identify and take advantage of them before our competition does?
  1. State of the Company — What’s our candid assessment in terms of (a.) leadership; (b.) middle management effectiveness; (c.) financial condition; (d.) product positioning; (e.) outside partners and vendors?
  1. Revenue forecasts — Considering product life cycles, what are the assumptions leading to best estimate, best case, and worst case sales projections for each of our existing products and services for the next five years?
  1. The Vision thing — What will be the profile of the Company in 2016 as described by (a.) revenues and profit; (b.) markets and geography served; (c.) market position and brand development; (d.) core capabilities; and (e.) organizational structure?
  1. Reinvention — What new products and services will help to close the gap between the revenue vision in 5a and the best case in 4? What’s the bottom line potential of each?
  1. Opportunism with focus — How do we move these beyond the concept stage? Who takes ownership?
  1. Do we have what it takes — in terms of product sourcing, management talent, personnel resources, financing, and just plain creative problem-solving — to build a premium value company?

We got many of these issues out on the table in our session last week. A lot of them resulted in follow-up assignments, some of which need some broad and deep thinking. At the risk of losing momentum (see Alligator Bites below), we’ll be scheduling most of our coming meetings after vacation plans in July. Hopefully, the results in early September will reinforce Lesson #1: First You Take a Vacation.

Alligator Bites

Based on years of experience,here’s what we see the typical small or midsized business go through when they’re considering a strategic planning off-site retreat:

Scenario:  The CEO wants to get his/her team working together to build a plan for the coming year or two.  The senior leadership team is buzzing about the excitement.  Everyone is looking forward to having some input on the plan.

The planning retreat is held off-site during a two-day session, which everyone finds rewarding and exhausting. They come out of the session with a clear set of goals and an action plan. Everyone has talked about what they are going to do differently to make sure it does. The team feels energized and looks forward to getting back to work.

Then what happens?

The senior leadership team goes back to work and they face the same chaos that attacks their everyday lives and business once again:

The strategies, goals and action plan you just put in place — seem to fade into the background.

You keep an eye on the financial statements occasionally, and hope it works out. At some point, the financial statements take a turn for the worse, and you jump back in, trying to figure out what’s going on and what you need to change.

The point is, most strategic planning retreats don’t work.

Before you commit to conducting one more strategic planning retreat, ask yourself:

  • Does your senior leadership team know how to make a real commitment, not just a “yes I’m on board” commitment, but a “yes I will get this done and I will stake my bonus on it” commitment?
  • Does your organization have the skills it needs to execute?
  • Can you focus?
  • Can you communicate the mission, vision, values and strategic direction of the company?
  • Can you drive active accountability — with everyone in the organization?
  • Are you willing to dedicate time — not only to the strategic planning process, but communicating it so your team members are able to execute your strategy?

BOTTOM LINE:  Execution is hard work. It requires a relentless focus, commitment and discipline. Before you invest a lot in developing strategy, invest in the skills and resources required to execute strategy. If you’re not ready for change — real change — a strategic planning retreat offsite is most likely another waste of time and money. Don’t let this happen to you.

— Skip Reardon, The Six Disciplines Blog, July 8, 2010