MARKETING MATTERSCEO JOURNAL
Getting Full Value From Planning I
DAN MARCUS, TDC CONSULTING INC., AMHERST, WISCONSIN
attended a conference recently and was pleased to see a lot of new, young faces among the
attendees. Tat’s good news for our industry, but the news there wasn’t all good. I was disappointed to hear one discussion in particular emphasizing some of the old, wrongheaded concepts and services that, while familiar and simple, don’t really improve profitabil- ity or otherwise add meaningful value. One such concept is strategic planning. Like much of conventional
wisdom, strategic planning can be a valuable exercise, one which can ad- vance a CEO’s mandate to maximize long-term profitability. But the larger truth is that in solidly mature indus- tries such as ours, getting full value from planning does not require us to regularly endure an expansive (and expensive) full-scale reexamination of the business and its strengths, weaknesses, opportunities and threats. Instead, metalcasting CEOs and management teams already have most of what they need for value adding planning and, at the strategic level, all they need is a concise, two-page vision statement. Vision statements articulate the products being manufac- tured and the customers being served, set out competitive advantages and major strategic and functional imperatives, highlight important commitments and ways in which business is to be conduct- ed, and describe the company’s current reality as well as its desired future state. Proper vision statements also reflect the customer’s voice; they are more than a one-sided internal assessment. And because our mature industry changes little from year to year, vision statements rarely need to be revisited. At the tactical end of the planning
spectrum, CEOs should be using a financial performance control system (FPCS) to develop and strengthen a profit-making culture and provide the day-in, day-out discipline and control
needed to ensure proper execution in pursuit of a monthly bottom line profit objective. FPCS are the CEO’s single most important and value adding planning, management and accountability tool, and provide all the micro monthly planning any business could need. In between the FPCS, which has an extremely short-term, micro orientation, and the long, macro view represented by the vision statement, metalcasters seeking full value from planning should employ a business- wide projects and priorities planning (P&P planning) process. P&P plan- ning has two facets—annual planning for the business as a whole and weekly planning for each key employee and employee team. Te objective of an-
Planning is a critically important management
and individual improvement goals. It is within this component of P&P planning that organization charts and job descriptions are revised, new hires are brought on board, training is pro- vided, and organization and employee development programs and tactics are mobilized to bring the company into better alignment with its desired future state. Here also is where the business, as represented by each of its managers and key employees, is held accountable for those results.
Te individual and team-level P&P
activity, but adds value only if it improves profitability and generates measurable
progress toward the company’s desired future state.
nual P&P planning is modest and straightforward; it is to select, pri- oritize, fund and otherwise focus the coming year’s activities on the handful of projects the management team believes will do the most to move the business toward the desired future state described in its vision statement. Once those business-level priorities
have been set and projects selected, CEOs and other managers collabo- rate with their reports to identify the individual and team projects and priorities that need to be carried out to operationalize the annual P&P plan and achieve related department, team
work is best directed by one-hour, weekly P&P conferences between managers and each of their direct reports. Te focal point of the P&P conference is the report’s P&P plan, which is a one-page document con- taining a simple list of pri- oritized projects and other activities that the employee should be working on in addition to his or her regular job. As each employee and team completes P&P items, which are aligned with the business-level P&P plan and, in turn, with the vision statement, the business can actually and perceptibly make progress toward its desired future state. Planning is a critically
important management ac- tivity, but the point of value adding planning is not to
reinvent the wheel or to contemplate one’s navel. Te point is to add value in the form of improved profitability and measurable progress toward the company’s desired future state. CEOs can use the tools described here—vi- sion statements, FPCS and P&P planning—to build a better, more successful business without breaking the bank or getting bogged down by planning approaches best left in the textbooks.
Keep the conversation going. Reach the author at
tdcconsulting@outlook.com to comment on this or any CEO Journal column or to suggest topics for future columns.
February 2015 MODERN CASTING | 55
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