Most managers consider themselves reasonably accomplished at business planning. Honestly, though — how many of us live the plan through to conclusion, and how many cascade it far enough that the people delivering the value even know it exists? Drafting a plan is less than half the work.
Planning without execution
Most of the work is in the execution. Business planning without execution is a waste of time, and the success data paints a dismal picture. Within five years, 68 per cent of small businesses fail due to a lack of planning, and a litany of significant companies — Eastman Kodak, Blockbuster, Polaroid, Borders Group, Nokia — failed through an inability or lack of will to modify, change or adapt their planning in the face of disruptive innovation.
Many corporates plan, but few practise strategic management: planning in advance, calculating outcomes, and using organisational resources fully and efficiently to navigate a challenging environment. Few use scenario planning, so they lose sight of diverse viewpoints, forecasts and competing priorities.
Too often planning is lip service, used to placate the board, shareholders and stakeholders. In most organisations the employees who actually deliver value have no idea a business plan exists, let alone what is in it. They go about their work unaware that their effort may be working against the plan.
A living process
Planning must stop being a thing we do. It must become a consistent, living process that forms part of everyone's daily work.
Creating a high performance organisational environment is more than drafting a well-developed corporate strategy. It is not a single process; it is a system of multiple processes working in harmony to create an environment in which engaged employees deliver excellence in human performance, which in turn drives exceptional organisational performance.
Why performance management systems matter
Research suggests organisations that implement effective performance management systems are likely to perform at a higher level in financial terms than those that do not.
Success in managing performance depends largely on organisational philosophy, corporate culture, and the attitudes and skills of the people responsible for implementing and administering the system. Individuals and organisations both profit from effective performance management, not least through feedback that genuinely improves individual contribution.