The only thing that is constant is change. Everything else is dynamic – be it technology, customer expectations regulatory norms or business trends. So, it only makes sense that a strategic plan should accommodate the ongoing changes. Or else, your business will not be able to absorb the market volatility in an agile manner. This is the core reason why you need to continuously monitor and evaluate your strategic management plan.
Monitoring and assessing strategic plans is as important as identifying strategic issues and objectives. It ensures that the organization is moving forward in the right direction and is well-aligned to its goals. Now, the question is whether an evaluation should occur before or after the evaluation? Well, evaluation in both scenarios is important.
Research indicates that 90% of organizations fail to successfully implement their strategies. Usually, the strategy is always assessed after the implementation. There is no other layer of planning involved before the implementation. Consequently, it is not able to address the gaps that arise in the interim of planning and implementation. The business dynamics are so complex and ever-evolving that things change from day-to-day, week-to-week basis. If there is a significant delay between planning and implementation, its effectiveness can go for a toss!
While it is imperative to evaluate strategy perpetually, it shouldn’t take away the long-term vision. Unless there is a business change that is game-changing, the plan shouldn’t be tempered to alter the overall goals for which it was prepared in the first place.
Frequency of Evaluation
There is no right frequency at which the strategic plan should be evaluated. It depends on the following factors:
- Nature of the organization – B2B or B2C, manufacturing or service, etc.
- Industry in which the organization is operating – mining, farming, e-commerce, oil & gas, etc.
- Current regulatory and economic situation – changes in the labour laws, economic changes such as demonetization
- Internal factors – labour strike, delay in supply of raw materials, machinery breakdown
Usually, a monthly evaluation should be conducted if the project has a horizon of 5-10 years. For short-term projects, a quarterly evaluation should suffice.
Questions to Ask During Evaluation
- Is the current plan helping in achieving the goals as per the stated timelines?
- If not, then what are the reasons for the delay?
- Are the people responsible for implementation equipped with enough resources such as money, manpower and training?
- Are the goals SMART – Specific, Measurable, Actionable, Relevant and Timely?
- Are the current processes effective enough to achieve the goals going forward?
- How are competitors performing for the similar goals as yours?
- Are there any internal or external, micro or macro factors that are impacting or can impact the goals?
- Are there any new opportunities that should be explored but not included in the plan yet?
- Do the goals need to be changed entirely? If yes, can the organization afford to deviate from the original goals?
- What are the lessons learnt from this evaluation exercise?
Answering these questions will give you a fair picture of where you stand as compared to where you want to stand.
Is There a Need for a New Plan?
Ideally and hope not! If your original plan requires a complete overhaul, it is an indication that something was fundamentally wrong with it. The evaluation should be more about monitoring the progress of the plan, managing minor changes, looking at data points and adjusting new changes. If at all the evaluation calls for the change in the business model due to unavoidable or uncontrollable factors, it should be done after assessing it cost-effectiveness and returns on investment.
The strategic plan may also change when the organization’s vision undergoes a transformation. In such a case, the change in the strategic plan is intentional. For example, when Tiffany brand launched itself in 1837, its goal was to sell stationery and fancy goods. 15 years later, it switched to jewellery. Today, Tiffany is the most coveted brand across the world.
Responsibility of Evaluation
The primary responsibility of strategic planning lies on the top management. Hence, senior leaders should do the evaluation. However, it is also necessary to include departmental or functional heads, and even teams from bottom layers of management to get a holistic perspective. In order to empower these people to do an effective evaluation, it would be a good idea to do business strategy courses online.
It is also important that the strategic plan is documented in the cloud in a single place such as Google Docs. This will ensure that whatever changes are made are updated and synchronized.
Remember that a strategic plan is a guideline to keep you on track. It is not a strict roadmap that can’t be changed if the situation deems necessary. The evaluation is necessary to plug in all the loopholes, fill the gaps, address the concerns/problem areas in a timely fashion, and take preventive actions.