Plans Are Useless, but Planning Is Essential
This article’s title refers to a quote that is most often attributed to Dwight D. Eisenhower, which goes like this: “In planning for battle, I have always found that plans are useless, but planning is indispensable.” There are a few versions of this quote, but this one stuck because of Richard Nixon’s first book, Six Crisis, in which he attributed the quote to Eisenhower. It may be Nixon’s first half-truth ever published.
Even Eisenhower had a few versions of this quote, the first recorded in a letter he wrote in 1950 that included the line “Peace-time plans are of no particular value, but peace-time planning is indispensable,” which he attributed to an anonymous soldier. That could be because Prussian Field Marshal Helmuth von Moltke the Elder had said it previously in 1871: “No plan of operations extends with any certainty beyond the first encounter with the main enemy forces.”
This quote (and misquote) took on new life when boxer Mike Tyson was asked if he was worried about his upcoming fight with Evander Holyfield in June of 1997. His response? “Everyone has a plan until they get punched in the mouth.” That fight unravelled quickly and was stopped in the third round after Tyson bit both of Holyfield’s ears. Hardly inspirational, but definitely sensational.
It may seem counterintuitive to put such a harsh label on plans, especially when one considers the amount of time that companies invest in drafting plans. Authors Michael Mankins and Richard Steele go even further, suggesting that companies stop making plans altogether. Their rationale is that typical strategic planning is a rigid, cumbersome process that gets in the way of good business operations.
On this point, I agree 100%. When planning is always completed on a set schedule, the authors argue that it’s irrelevant to leaders who need to make decisions all year long. They call this the “calendar effect,” something that became obvious to businesses that had to wait several months to adjust their plans when lockdowns went into effect in March of 2020.
Typical strategic planning does bring with it a measurable negative impact. The Economist Intelligence Unit surveyed more than 150 global companies with more than $1 billion in revenue to assess how planning drove decision-making. They found the companies using typical strategic planning only make space for 2.5 major decisions per year, with “major” defined as something that could impact revenue by 10% or more. In Profit from the Core, Zook and Allen report the results of their research: 90% of companies use typical strategic planning, but 88% of those companies fail to achieve profitable growth.
Companies are leaving too many decisions on the table. This begs the question: How do they plan in a way that delivers better decisions and profitable growth? In my experience, two key components are required.
Stop Doing Typical Strategic Planning
The annual cycle must give way to continuous planning. The organization that has made accessible how to effect continuous planning will always be nimbler than the organization that saves the big moves for fall planning. In very large organizations, Mankins and Steele call this “business tourism,” when the bosses fly in for a week of planning and head-nodding over a couple of dinners.
What is astonishing is that Zook and Allen’s scientific results are pretty much truism in corporate North America – most companies are unable to connect strategy to execution with typical strategic planning. Easily accessible, but uncommonly used, strategy management frameworks make this link explicit. But even more impactful is how these frameworks transform strategy from an esoteric, almost hidden set of activities into something available to all leadership, and even the entire company if so desired.
The Execution Premium, by business school prof Robert Kaplan and writing partner David Norton, explains how the office of strategy management (OSM) enables an entire organization to quickly build, adapt and execute strategy. Being able to execute well gives organizations that use this process an execution premium over their industry peers. Stop doing typical strategic planning and start using a framework.
Practice, Practice, Practice
I am not a huge fan of sports metaphors, so let’s call this one my “middle-age metaphor”: If you don’t go to the gym regularly, it will feel painful when you do finally work out. The same is true with planning. Continuous planning that is enabled by strategy management frameworks provides this necessary practice, helping make the planning process efficient and more impactful when faced with a novel crisis that is inconveniently timed. And since the entire organizations understand how planning works, how to link strategy and execution is not a secret. Before you know it, an organization’s 10,000 hours add up. Practice is essential.
It might be hard to accept that plans are out of date the moment they start to be used. But the last two years of working during a global pandemic have taught us that the companies that thrived are the ones that were able to adjust their plans – and execute on them – at any time.