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Why business plans are stupid and strategy maps are smart

July 31, 2015

Allow me to play Carnac the Magnificent for a moment.  The answer: “Sitting on a shelf collecting dust.”  The question? “The location of your last business plan,” of course.  Why is it that business leaders like us continue to write long and involved business plans, consuming so much time and energy, when no one ever uses or even reads them?

 

I guess you could make the claim that the mere fact of writing a business plan is an end in itself – clear writing is clear thinking, right?  Maybe.  But that wouldn’t be a very useful way to transfer knowledge across your organization, to communicate a plan to others for rallying purposes, or to help you execute a plan that takes more than a few steps to complete. 

 

Traditional business plans are for the birds.

 

Instead, I’ve become fond of using strategy maps instead of business plans.  You can think of a strategy map as a document that describes how you’ll solve some problem to achieve a specific goal.  But like GNU (which stands for, “GNU’s Not Unix!”), strategy maps have an inherently recursive element, in that each step in a strategy map is itself a mini and embedded strategy map.  It will become more clear with an example.

 

 

 

Let’s say you’re hungry, and after having gone out to dinner with friends, you would have had a great time, some great food, and a few great stories - the topic of conversation for days to come around the office.  The strategy map for this dinner might start with a good problem statement:

 

Problem: I’m hungry and need to eat.

 

Then, let’s add a happy ending to our story, the “lived happily ever after” that you want to accomplish as a result. 

 

Dénouement: Had a great dinner with friends, epic in style, everyone loved it and had a good time, and no one got food poisoning.

 

Now how do you get from A to B? A sequence of steps is in order:

 

Here's our first strategy map:

Problem: I’m hungry and need to eat.

- Select a restaurant.

- Enjoy the meal.

- Post some funny pictures on Facebook and tweet something witty to all who attended.

Dénouement: Had a great dinner with friends, epic in style, everyone loved it and had a good time, and no one got food poisoning.

 

Now, each one of these steps probably contains quite a bit more detail. Selecting a restaurant is a problem in and of itself.  What type of food? Do they have room for a new reservation?  What about the vegan guy that’s coming with us, will they have anything for him?  This deserves a problem statement:

 

Problem: I’m hungry and need to eat.

- Select a restaurant.

   Problem: We need a restaurant that we can all go to that everyone will enjoy.

          - Get a count on how many are going.

          - Make a list of the top 5 choices.

          - Call each one to find one that has a table available between 6pm and 8pm.

          - Make a reservation, and email the group with details.

   Dénouement: We selected a restaurant.

- Enjoy the meal.

- Post some funny pictures on Facebook and tweet something witty to all who attended.

Dénouement: Had a great dinner with friends, epic in style, everyone loved it and had a good time, and no one got food poisoning.

 

See where this is going? Strategies are a sequence of strategies, and so, too, are strategy maps.  What does this have to do with business planning? By using a strategy map framework, you will find that it forces your brain into thinking about things in the “right” way: what’s the problem we’re trying to solve for, what does success look like, and how will we get there?  And doing this iteratively, with an increasing level of detail, allows you to accomplish a few important things:

  • Your executives can focus on big picture stuff, and avoid becoming micromanagers, by leaving the iterative drill-down of strategy map detail to their teams.  And so on down the line. 

  • This emphasizes getting things done, rather than some grandiose strategy that no one understands.  By their very nature, strategy maps are inherently action lists.  Circle part of it and go execute.

  • It helps you identify dependencies that might get in your way.  You’re going to naturally write the sequence of steps (strategies) in a strategy map in a chronological or dependency order.  First I have to do this, then that, then we can do the last thing.  Assign some dates and you have a nice, lightweight project plan.

  • It’s easy to track progress.  Finished something? Cross it off.  Need a reminder on what you need to be focused on next? Read it from the list. 

For years, I’ve used strategy maps for product management, marketing plans, and business planning for startups and new initiatives.  You won’t see a traditional business plan anywhere on my shelves – and I think I’m better off for it.

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