Four strategic planning myths

Bigfoot exists. The Loch Ness Monster is real. LeBron James is basketball’s GOAT.

All of the above are myths. Urban legends. Fantasy (for those LeBron Lovers, two words: Michael. Jordan.).

They are sometimes stories we tell ourselves and then start to actually believe. It’s no different with strategic planning. Whether your credit union is large or small, there are certain things you start to believe about strategic planning. And some of these are simply not true.

Let’s take a look at four strategic planning myths, disprove them and unveil the truth.

Myth Number One: Planning must be done in the fall

This is perhaps the biggest fallacy with planning. For many financial institutions, planning is always in the fall. It’s just the way they’ve always done it. Once planning is complete, they roll into the budget cycle.

But as we routinely tell our clients: planning is a process, not a date on the calendar. It’s far more important that you DO a planning session than do it at a specific time of year.

Many credit unions have found several advantages to planning during non-fourth quarter time periods. It gives them increased focused because Q4 is usually so busy. It helps with their budgeting process because they are not trying to cram budgeting and planning at the same time. It’s also easier to manage multiple calendars (board and executive staff).

One of our top-performing clients does their annual planning session every January. Their CEO feels it sets the tone for the entire year and gets staff excited about upcoming initiatives.

As Arts Action Research says, “There’s no season and no particular point [for strategic planning] … for different organizations it comes at different moments. There is never a best time or ideal time.”

When we’re asked about the best time to do strategic planning, we often say “when you’re going to be able to focus on the plan and its execution.”

Reality: Strategic planning sessions can happen in all four quarters of the year.

Myth Number Two: We can do planning ourselves

It’s easy to think you don’t need an outside facilitator for your planning session. After all, no one knows your credit union better than your team. And more likely than not, you have seasoned people working at your credit union.

When I was an executive at Neighborhood Credit Union, we had a fantastic leadership team (and they still do). So, some years we would do our planning internally. Those sessions resulted in good plans. But when we brought in an outside consultant to guide us, the sessions were so much better. Rather than leading, we could focus on participating. Those sessions resulted in great plans.

As SME Strategy notes, “Using a professional facilitator who understands business strategy as well as how the people within them operate will help bring your organization to a new level of teamwork and effectiveness.”

Executives doing their own planning sessions have good intentions. But intentions don’t do the dishes. In other words, you can intend all day long to help your wife with chores, but you must actually work to get them done.

When it comes to facilitating, let someone else do the work.

Reality: The best planning sessions are facilitated by an outside consultant.

Myth Number Three: We must do a SWOT analysis for planning

As I’ve written and said for many years: It’s past time to throw out the SWOT as part of your strategic planning process. While the exercise is useful, it’s way overused. It’s also a waste of time: everyone in the session already knows your strengths, your weaknesses, your opportunities and your threats. And many times, those items don’t change from year to year.

Some proprietary exercises we do in our planning sessions are the Five Star Credit Union Analysis and the Myth of Excellence (based on this classic book). We also do a unique exercise centered on your digital and branching strategies.

The key is to mix things up. Conduct a different planning session by conducting different exercises.

One reason many executives (and board members) are tired of planning sessions is because it’s simply “rinse and repeat.” One way to stop that is to flush the SWOT down the toilet.

Reality: You can do different strategic exercises more effective than the SWOT.

Myth Number Four: We need reams of data for planning

Some strategic planning binders are ridiculously long. They are literally filled with hundreds of pages. Graphs. Financials. Numbers. Pages upon pages upon pages.

All of that information can be useful. It can also be overwhelming.

Please note: I’m not saying that you should make strategic decisions without using data, or that data is unimportant. The key is the volume of data. We tend to want data and more data so that our decisions are perfect and mistake-free.

But as Harvard Business Review noted, “Companies must recognize that strategy is not about perfection.” It’s not about data; it’s about the right data. Determine which key indicators are most important and build your strategy from there.

Reality: A dashboard of between five and seven data points is all you need for planning.

Strategic planning sometimes turns into a wish list. However, if you want to build the ultimate strategic plan (one that is actually implemented), start by eliminating a few myths and replacing them with reality.