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Good Governance: Bottom-up Strategic Planning


November 2011 – Vol: 34 No. 11
by Lisa Hochgraf

High performing organizations’ planning processes benefit their stakeholders

Credit Union Management magazine’s Web-only “Good Governance” column runs the first Wednesday of each month.

“Without the research involved in bottom-up planning, it is impossible to truly understand our value proposition or to get meaningful results.” ~Steve Jobs, Apple

High-performing organizations use practical and measurable bottom-up planning processes for the benefit of their stakeholders, John Oliver told attendees of the inaugural CUES Director Strategy Seminar in January 2011.

Strategic Planning Process Outline

Presented by John Oliver during the inaugural Director Strategy Seminar, during January 2011 in San Diego

  1. Appoint project manager and planning team and then train them.
  2. Communicate throughout the organization the process that will be used.
  3. Have the project manager and team develop timelines and responsibilities for a strategic research program.
  4. Do the research (limit the effort to three months, and be sure to collect hard data, opinions and ideas both from employees and from external sources, including members and the marketplace.
  5. Analyze the information. (cull it down to exec summaries of key findings)
  6. Hold a scenario planning session and come up with a SWOT (strengths, weaknesses, opportunities and threats) analysis.
  7. Hold a retreat. This is a decision-making day done off site with no budgets, no tactical details. Focus on the “O” part of the SWOT analysis: What do we think strategically are the key opportunities for this organization? Then define broad strategic objectives, a list of less than 10 specific statements of desired accomplishments. Make your objectives challenging enough to get some strategic change. Go for some easy wins as well. Note: this is not a social event; spouses are not invited.
  8. Give a bullet point list of the strategic objectives and ask them to draft a plan for how to accomplish these.
  9. Hold a second retreat. Ask management to present the plan they’ve developed for how they are going to accomplish the objectives.
  10. Ask management to finalize the plan based on the feedback generated in the second retreat.
  11. Communicate throughout the organization the content of the plan.

Timeframe: Allow three months to get to Step 7, the first retreat. Allow another three months for management to develop the plan.

Starting to develop a strategic plan with information from the bottom of an organization up means starting with intensive market and internal research—research that can take up to three months to complete, said Oliver, president of Laurel Management Systems, Palm Springs, Calif.

“This is where you’re asking members the questions: Do you think of yourself as a member or as an owner? Would you please define your ideal financial institution on price, service, location and delivery channels?”

Then the research comes back to the employees, from whom a credit union needs to get details and sentences, not simple answers.

The biggest question to ask of the employee is “Do you feel a part of this organization or do you show up in the morning just to do a job? Oliver said. “The answer to that question will show a bias in every other question they answer. It’s deeper than the average employee survey.

“If you want a successful strategy, it will absolutely demand an engaged workforce,” Oliver emphasized. “They need to understand their role in it and how they can help make the strategy successful.”

Next research should be done about management’s perspectives and a SWOT analysis should be part of the effort to digest the information collected.

Oliver likes to focus on the opportunities portion of a strengths-weaknesses-opportunities-threats discussion. The question becomes “what are the biggest opportunities that this research program has demonstrated and how are we going to take them and make a good business program for our credit union?”

Another part of the process should be a business process audit. Ask: Are there things our competitors are doing well?

“By the time this gets to the board, you can come up with strategic decisions that are more likely to have an impact on the bottom line, in the marketplace, with your members,” than if you approach strategic planning from the top down, Oliver said.

What scares people away from approaching strategic planning in this way? Oliver offered that it’s lots of work, and that it’s going to show the good, the bad and the ugly about the institution.

“Strong leaders are prepared to undertake the hard work that goes into effective planning and they recognize the need for quality research that will enable them to make strong strategic decisions,” Oliver said.

Lisa Hochgraf is a CUES editor.

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