You have developed the strategic plan, but have you considered probabilistic or Monte Carlo simulations to deal with today’s uncertainty? What is the probability the economy will turn around in Q3, Q4? The DC pundits would have you believe things with 100 percent certainty, but as a business executive, what do you think? Fifty percent? More? Less?

Or have you planned for continued contractions of 1, 4, or 8 percent? Scary scenarios, but have you done a reality check with your customers, their expectations? We are currently collaborating with a utility, and they have always considered their load growth, electricity consumption, of between 1 and 3 percent per year as a given for strategic and financial planning. BUT, they were shocked to see their load growth contract 3 percent!! Does this resonate with your company? So, what do we do? more

You have developed the strategic plan; you’ve identified the short- and long-term strategies and goals. But how well have you advised your organization on developing leading indicators to provide an early warning system for your board and executive and management teams? Are you still managing off the financials or lagging indicators? By the time the books close 10,15, 20, 25 days after month’s end, the impacts of yesterday’s decisions are already being felt. Wouldn’t you want to get ahead of the curve to know with some degree of certainty what is coming? Of course, we all do. more

Conventional wisdom focused on strategic planning as a static, annual process that would flow through the budgeting and operational planning processes. However, we are not in traditional times. More often, companies are taking notice of current conditions that have rendered assumptions in these plans obsolete, and are going back to the drawing board.

For instance, did your strategic plan contemplate the government takeover of numerous banks, nearly the entire sector? Did GM in the auto sector mean Government-Managed when you prepared your SWOT analysis? Did your ERM contemplate current default rates on homes, cars, and commercial real estate? Did your global plan include recessions in nearly all markets or did it foresee a balanced portfolio in these markets?

What we are seeing is a more dynamic strategic planning process taking into consideration more current, relevant, leading market indicators, with near-term planning horizons. Is this correct? Time will tell. However, CPOs and their C-Suite colleagues are no longer waiting until next year to reformulate. Next year is now! ###

Research shows that CPM office employees possess deep expertise in one or more competencies. Note that employees are not CPM generalists who lack depth in any one competency. It is important for team members to possess deep organizational knowledge to understand the political topography and have the ability to read changes in the organization and shifts in the agendas of key executives and influencers. In addition, these employees leverage industry-specific knowledge during the course of improvement projects, so it is also important to have CPM office employees with deep industry experience. more

They execute on strategic processes. Let’s talk about process ownership. One benefit of instituting a CPM office is that it can be aggressive in removing the silos that inhibit information-sharing companywide. Uncoordinated and distributed CPM process ownership invariably leads to inconsistencies in CPM process application, different versions of the truth, and projects that are islands unto themselves and so fail to consider the performance management needs of the company overall. CPM offices entirely own, provide substantial governance over and standards for, or else heavily facilitate performance management processes such as strategic planning and knowledge management. more