Paul, SmartDraw’s founder and CEO, wrote a compelling and thought provoking article on the rise of HTML5 for TechCrunch this week.
“Might the arrival of new cloud-based apps that run in a web browser and store their data in the cloud create enough of an advantage over the common desktop environment to cause a similar shift? Interestingly, there are quite a few parallels between the arrival of cloud-based apps and the arrival of Windows 30 years ago.”Paul Stannard
You can read the full article over at TechCrunch. What do you think? Is HTML5 the new Windows, and cloud-based apps the way forward?
With Apple’s Worldwide Developer Conference kicking off this week, I’m reminded of something I learned from Steve Jobs. Something both powerful and yet incredibly simple—the very epitome of Jobs’ genius.
The year was 1997. Apple was at a crossroads. It had wandered far from Jobs’ original vision. Twelve years after his tumultuous departure the company was bleeding cash and on the verge of bankruptcy. It was losing a battle with Microsoft’s Windows operating system, allowing clones of its desktop computers, and taking a scattershot approach to developing dozens of disparate products. In Jobs’ view, Apple had lost its vision.
But Jobs had a vision. He recognized that Apple owned a valuable, albeit tarnished brand. He also saw change taking place: a new world of personal media and communication devices. A future where an innovative and agile company could outmaneuver desktop giants Microsoft, Intel, and Dell.
Jobs also knew he had a problem. His vision was going to take Apple in a completely new direction. In order to gain consensus he had to present his strategy to the company’s management in a clear and yet impactful way.
So what did he do? He walked up to a white board and drew a simple four-quadrant matrix.
Jobs set forth Apple’s revamped strategy in one diagram. Four markets, four products, one crystal-clear vision: Apple has a computing device for anyone, anywhere. Simple, yet incredibly powerful. Anyone who looks at it can understand it without a single word needing to be spoken.
This is the essence of visual strategic thinking.
What makes visual strategic thinking so effective?
Studies show that most people are visual thinkers. Steve Jobs understood this and used it to communicate his vision, whether in a small meeting or at his famous Apple World presentations.
The good news is that anyone can tap the same powerful communication method that Jobs employed. Here’s how.
Visual strategic thinking, like Jobs’ four-quadrant visual, is built upon four key components:
1. Big picture thinking
Strategic thinking is all about the big picture. But the big picture can be difficult to explain. Using pictures, charts, and diagrams is a means to express those thoughts to others so that they can see them, too. The old adage, “a picture is worth a thousand words” holds true when communicating complex ideas such as a strategic plan. Like Jobs’ matrix example, words alone simply can’t convey a message as thoroughly as a concise visual image.
The image below compares a traditional page of text to a concise diagram. Big picture thinking is best presented with a focus on a few key elements, not by delving into too much detail.
Because people think visually, an image like this one is more effective than a page of text. It’s easier to understand, retain, and recall information presented in this manner.
Simply put, the big picture is easier to see in a picture.
2. Engagement and collaboration
To engage people, use a visual. Spreadsheets, slide decks, and reports are rigid. They are useful as supporting collateral, but they imply one-way communication. This allows people to easily tune out.
When doing on-site strategy work, many consultants bring in cases of sticky notes and dry-erase markers in every color imaginable. Why? The act of getting people out of their seat and up to a white board fosters collaboration. The majority of people simply can’t resist sketching, highlighting, and commenting when charts and whiteboards are available. And you don’t need to bring in a graphics artist—even bad visuals get people engaged. A room filled with engaged people works better on big ideas like strategy; decisions will come easier as well.
3. Clarity of message
People appreciate a message that is clear. Jobs’ matrix couldn’t be much clearer. Rather than locking away a company’s grand plans in a binder, that diagram could hang on a wall.
When everyone knows the plan, it fosters openness and trust. The direction of the company is transparent. Research shows a strong correlation between employee happiness and company transparency. Keep your message clear and open. A simple, strategic visual helps foster this.
4. Focus on implementation
All of this big picture thinking, engaged collaboration, and transparency falls flat without execution. But that is the beauty of visual strategic thinking. Each element builds on the previous. A clear big picture leads to engaged employees, who see the grand vision the same way you do. Engaged employees help get everyone involved. With a clear vision and collaboration, you inherently have greater transparency throughout your organization because the strategic message is very clear and open. The reason is simple: engaged, happy employees execute better. A key lesson is that visual strategic thinking is a cycle, moving right into supporting execution with additional visuals, winding up back at the white board with visuals and an engaged team.
A valuable lesson
Visual strategic thinking can seem a bit nebulous, and in many ways it is. But that is not too different from normal strategic thinking. Most strategic thinking today involves some kind of visual already. It’s not as big of a leap as you might think. I encourage you to try it and then see the results.
It’s difficult to accomplish anything without a plan. Whether you’re hosting Thanksgiving dinner, running a small business, or coaching your child’s soccer team, you need a strategic plan. By establishing a strategic plan business leaders are able to determine where to spend human capital, time, and money. With year-end payroll reporting activities in full swing and the holidays fast approaching, this is an opportune time to plan for next year. Fortunately, SmartDraw has the analytical tools to meet your strategic planning needs.
Strategic Planning Category
The Strategic Planning Category contains a number of sub-categories that range from competitive analysis diagrams to PEST analysis to strategy matrices. Depending on the analytical methodology that you choose to apply during the strategic planning process, you may find that a combination of these templates will prove to be valuable. Although there are a number of templates that can easily be applied, this week’s spotlight will be focused on the Ansoff Matrix, Porter’s Five Forces Analysis, and SWOT Analysis tools.
Strategic Planning Category’s Sub-Category List*
Strategic Planning Templates
Five Forces Analysis
Force Field Analysis
Value Chain Analysis
*Note: Each sub-category contains a folder of templates and sample diagrams.
SmartDraw Tip: To access the Strategic Planning Category, simply open SmartDraw. In the Left Panel of the Category screen, select Strategic Planning. The Strategic Planning Template sub-category will appear in the Category Preview and the remaining sub-categories will appear in the Left Panel as shown above.
The Ansoff Matrix was first published in the Harvard Business Review in 1957, enabling business leaders and marketers to develop strategies for future growth in a quick and simple way. It is also referred to as the Product/Market Expansion Grid. The matrix shows the four ways business can grow. The idea is that each time you move in a quadrant (vertically or horizontally) you increase risk. Click here to view examples of Ansoff Matrix diagrams.
Five Forces Analysis
The Porter’s Five Forces Analysis Tool is a simple yet powerful tool to that enables you to understand the strength of your current competitive position and the position you’re considering moving towards. By using this tool you’ll be able to weigh the potential profitability of new products, services, or businesses. In short, you’re examining the five important forces that determine competitive power in a business situation. Click here to view examples of Five Forces Analysis diagrams.
SWOT Analysis is a strategic method that allows you to evaluate the strengths, weaknesses, opportunities and threats involved in a project or business venture. Below is an example of modifying an existing SWOT diagram template. The SmartDraw User Guide: Fundamentals for New Users can walk you through techniques of how to add color and effects to modify or brand any of the templates. Click here to view examples of SWOT Analysis diagrams.
Can a strategic plan truly yield bottom-line results? Or is it just a waste of time?
The answer to both questions can be yes. It’s critical to plan for success. More importantly, there are steps to follow to make it happen.
Most businesses don’t do any strategic planning. And, of the ones who do, most treat it as nothing more than an academic exercise. This is unfortunate. With some effort and a willingness to make hard decisions, it’s possible to create more than just strategy. It’s possible to realize bottom-line results from a well-developed strategic plan that is then put into action and followed through.
Strategic Planning Can Be a Staggering Waste of Time—If You Let It
McKinsey & Company published an article written by former IBM CEO Louis Gerstner back in 19731. But Gerstner’s ideas might be even more applicable today than they were more than 40 years ago. To understand his thinking in today’s context, we must consider the state of strategic planning when Gerstner wrote this piece.
Strategic planning was a management phenomenon in the late 60s and early 70s. It was being hailed as “the fountainhead of all corporate progress.” Everyone, it seemed, was doing it—or in danger of being left in the dust by the competition.
Then something happened. CEOs began questioning the effectiveness of strategic planning. One anonymously referred to it as “a staggering waste of time.” Another called it “basically a plaything of staff.” And strategic planning began to fall out of vogue.
What changed? How did strategic planning–once the road to corporate nirvana—suddenly become a C-suite pariah?
According to Gerstner, the CEOs didn’t see any bottom-line impact. Therefore, they considered strategic planning to be merely an academic exercise that offered no tangible, real-world results. But Gerstner laid the blame on these executives themselves. What they called strategic planning was, in his view, little more than an extrapolation of short-term financial projections.
Here’s what Gerstner had to say:
Many strategic-planning programs begin with the extension of the annual operating budget into a five-year projection. Most companies, however, soon discover that five-year operational and financial forecasts, in and of themselves, are ineffective as strategic-planning tools for a fundamental reason: they are predicated on the implicit assumption of no significant change in environmental, economic, and competitive conditions.”
He offered up some reasons for why so many efforts at strategic planning fail to produce financial results—and what can be done about it. This mind map summarizes Gerstner’s thoughts on strategic planning for bottom-line results.
Do You Have the Guts to Develop a Successful Strategic Plan?
But strategy requires much more than extrapolating a budget. It requires an open, honest examination of the toughest issues the organization faces. Tough questions have to be asked. Warts may need to be exposed. This can be difficult. It can be uncomfortable. It requires leadership and decision-making. It may require risk. That takes guts.
Gerstner’s advice: “Make decisions—not plans.”
Risk is Out There—Ignore at Your Own Peril
Are you giving attention to what your competitors are doing? What about other changes going on around you? Gerstner criticizes most companies as giving minimal attention to external risks.
Too many organizations fall into this trap. It’s easy to think that internal decisions and actions fully account for the company’s results. But this is a fallacy. Good strategic planners will spend a great deal of time, energy and focus on external forces.
For organizations that tend to focus internally, it may be advisable to bring in outside help. A third party can offer expertise and a fresh perspective as a non-stakeholder. But be forewarned: it’s very likely that the information won’t be benign. There will be threats to your business. Analysis will be needed and decisions will have to be made.
A final component of the external scan should be the development of contingency plans. Developing the right contingencies—ones that will actually work—will again require brutal assessment. You’ll need to ask some tough “what if” questions.
This will probably come with one major objection: “How can we possibly know all of the potential contingencies?” The answer to this is to only develop one or two contingencies that could be disruptive in a major way. For example, a competitor is working on a new technology that could capture 15 percent of your market share next year. If that were to happen, what would you do?
Making a difficult decision like this immediately—rather than under the duress of an emergency situation later—could have a dramatic impact on your company’s bottom line.
Real Strategic Planning Requires C-Level Involvement
Your company needs a strategy. But, as the CEO or other key executive, you can’t delegate this downstream and expect to see bottom-line results. It won’t happen, for one very simple reason. They can’t make the hard decisions that are required to produce a viable strategic plan. It doesn’t mean they aren’t valuable for other tasks, such as gathering and organizing data. But this is an exercise that requires all of the top company brass to get involved, roll up their sleeves, ask the tough questions, and make informed decisions.
The Secret to Making a Strategic Plan Produce Bottom-Line Results
All of the other pieces discussed in this article are important. They need to be implemented for any organization to have a viable strategic plan.
But one element is absolutely essential. Without it, any plan is doomed to fail. Yet oddly enough, it may be the most overlooked piece of the strategic planning puzzle.
What is this secret element?
The secret is this: You must convert the plan into action. After all, if you don’t execute a plan, what’s the point of even creating it in the first place? Amazing as it may seem, it rarely happens. And when it does, incredible companies are built.
Think of some of the great business leaders of the past few decades: Welch, Iacocca, Walton, Gates, and Jobs, to name a few. They led their companies first by developing great plans that required making tough decisions. But they didn’t stop there. They put those plans into action and followed through. Each of them took calculated risks, accepted mistakes, adjusted his plan, and persevered in pursuit of it.
A new year is a great time for re-thinking your organization’s strategy. But all strategic plans are not created equal.
Successful strategic planning involves awareness and avoidance of common, critical mistakes that doom many plans to failure.
Here are 10 reasons most strategic plans fail to produce results. Avoid these pitfalls and you’ll be on the road toward developing a successful strategic plan.
1. Lack of Commitment
Having a valid, executable strategic plan is in everyone’s best interest. But it is crucial to get buy-in from leadership throughout the organization. Without this shared vision and commitment, even the best strategy is unlikely to succeed.
2. Failure to Involve Key People
Who are the right people in the strategic planning process? The simple answer is anyone who is crucial to setting forth the company’s vision as well as those responsible for carrying it out. Having all of the key stakeholders involved in planning helps ensure team commitment.
3. Thinking Too Small
Strategic planning is intended to focus on high-level thinking. What is the organization’s vision? Is the mission clearly defined? Strategic planning is the time to set audacious goals. Keep thinking big. Forget about the details for now. Make sure to give priority to those major, over-arching issues critical to the organization’s success.
4. Failing to be Honest
It’s easy to see ourselves as we want to be seen, or how we envision ourselves down the road. But it is absolutely crucial to make a real, honest assessment of internal and external issues as they exist today. This may even involve bringing in one or more third parties. But without an accurate assessment of where you are, your strategic plan will be flawed.
5. Failure to Consider Reality
Changing forces, both inside and outside of an organization, require you to constantly assess what is happening around you. Management teams must be acutely aware of these forces. Assess how they affect the organization, its markets, its customers, and its future.
6. Unwillingness to Change
It is crucial to constantly assess and adapt to change. A good plan yesterday may no longer apply today. Successful leaders must be nimble and ready to adjust with change, rather than fight against it—or even worse, ignore it.
7. Failure to Set Goals
A good strategic plan sets forth a vision, but also provides a working framework within it. Make sure that goals and milestones are set, and develop a timeframe for achieving them.
8. Failing to Put the Plan into Action
If you don’t put your plan into action, then you are just wasting time. As Jack Welch said, “In real life, strategy is very straightforward. You pick a general direction and implement like hell.”
9. Lack of Accountability
It’s pretty simple. If no one is held accountable, nothing gets done. Putting the plan into action is only the beginning. To make sure things get done, assign areas of accountability to specific people. Share the plan among the entire team, so all members are openly held accountable.
10. Failure to Monitor and Follow Through
Set regular intervals for formal review of the strategic plan and action items. Most strategic planning experts suggest this be done at least on a quarterly basis.
Start Developing Your Strategic Plan Now
If you don’t have a strategic plan, or if you have one that isn’t working for you, now is the time to get on track. To help guide you, download our free white paper.
“Baseball is ninety percent mental and the other half is physical.”* Just like strategic planning, sort of.
I first used SmartDraw to create diagrams for the Little League Baseball team I managed in the 1990’s. Having never played organized baseball, and possessing little to no natural athletic talent, my approach to coaching was to buy books about the subject and study them. I discovered that the key to a successful Little League outcome as a coach involved finding unique methods to hold the attention of young players during a game. (In the interest of full disclosure, I also found that recruiting an assistant coach who knows what he’s doing is quite helpful, too.)
In baseball, each player has a responsibility to cover either a specific base or the ball itself. This depends upon what position they are playing and in what direction the batted ball travels. I found it far more effective to teach nine-year-old boys base- and ball-coverage assignments with diagrams rather than coaching with words alone. I could show kids, rather simply, the five or so primary directions a hit ball might travel using a visual, and why they might want to take their fingers out of their noses and move somewhere else on the field when that happened.
This was my hands-on introduction to the power of visual communication and how it could apply to many aspects of my personal and business life, such as strategic planning.
According to psychologist Jerome Bruner of New York University, as cited in “Syntactic Theory of Visual Communication,” studies show that people only remember 10% of what they hear and 20% of what they read, but about 80% of what they see and do. My experience with our Little League team was consistent with that account.