The ROLE OF MANAGEMENT IN THE Strategic Planning Process

1. The ROLE OF MANAGEMENT IN THE Strategic Planning Process By Essien Abel Essien Director, Strategic Planning ECOWAS Commission Presentation to the ECOWAS Management Retreat, Accra, Ghana, March 6-9, 2009

2. OUTLINE • Introduction • Strategic Thinking • Setting Strategic Direction • Final Notes • Concluding Remarks “In this period of rapid change we should shift from strategic planning to strategic thinking and strategic management otherwise strategic planning would impede strategic thinking ( Henry Mintzberg (1994)”.

3. INTRODUCTION • Strategic action is necessary in situations where circumstances block the way to an objective. • Smart Managers use strategic thinking to identify areas of vulnerability, and then try to figure out how to exploit that vulnerability. • The role of Management in the planning process is to set strategic direction for the organization. • This they do through developing the skills of Strategic Thinking “The smartest and most effective Managers think, plan, and act strategically. Inexperienced Managers make the mistake of focusing only on stopping things. Their only action is reaction. All they do is maintain the status quo and they actually lose in the long run, because the rules never change and there are all sorts of things they’re not stopping.”

4. STRATEGIC THINKING • Strategic thinking is about synthesis, about using intuition and creativity to formulate an integrated perspective, a vision, of where the organization should be heading. • Strategic thinking is used to: • Identify such situation, and then try to figure out how to exploit it to the advantage of the organization. • Solve problems before they happen, examining the pros and cons of various moves in order to identify the best course of action. “To think before planning is a logical one, yet most strategic planning processes devote insufficient think time prior to planning. The desire to get a strategic plan completed quickly relegates thinking to filling in blanks on work sheets”.

5. STRATEGIC THINKING: CREATING A STRATEGY Creating a strategy involves: • Defining goals and intermediate and short-term objectives • Identifying Obstacles • Carrying out a SWOT analysis • Imagining and playing scenarios • Identifying primary and secondary targets • Deciding what resources are required • Identifying allies • Devising tactics • Drawing up an action timetable. “If you lose sight of your goals and objectives, everything goes haywire”.

6. STRATEGIC THINKING: PRIORITIES FOR MANAGEMENT Determining the Vision for the Strategy • Debate current strategy to ensure that all are at the same level of understanding—Where are we today? • Examine the environment. Systematically examine the most significant variables, issues --internal and external to the organization. • Determine the Strategic Options • Assumes there are sustainable results in terms of growth that need to be achieved over the next strategic time frame • Assumes there are particular skills and capabilities which should be continuously developed to sustain success • Ensures consistency when allocating resources and when choosing between opportunities in all future decision making.  “There two important tools available to planners in helping Management think strategically-- Visioning and Scenario building-- by identifying what is on the horizon, signals of change in specific sectors of the macro-environment (social, technological, economic, environmental, and political) and suggesting their implications.”.

7. STRATEGIC THINKING: PRIORITIES FOR MANAGEMENT Develop a Strategy Profile for the future. • Using the strategic options, construct a statement of strategy which clearly explains the concept and purpose of the organization. This statement is concise, unambiguous and easy to understand.  • It can be used to communicate strategy to all stakeholders both internally and externally. • A future strategy is built on collective skills and capabilities, which are clearly identify so that resources can be allocated for the purpose of honing these skills into a sustainable competitive edge. “Planners should encourage Management to think about the future in creative ways, to question conventional wisdom, to raise difficult questions, and to challenge conventional wisdom and assumptions”.

8. STRATEGIC THINKING: PRIORITIES FOR MANAGEMENT Define the Critical Issues. • All the issues and actions that are seen as critical to the success of the strategy are clearly identified. • Each critical issue is prioritized and all the high priority issues are taken and expanded into an action plan by identifying the key plan steps and resources needed.  • An owner for each of the individual high priority critical issues is also appointed. • This is to make sure that it optimizes the organization’s strengths, maximizes its opportunities and demonstrates a distinctive competitive edge. “Consider three interlocking rings of who you are (strengths and weaknesses), what the stakeholder wants (opportunities and threats), and what you stand for (purpose and mission). The central intersection created by these three rings will reveal the unique opportunities that only your circumstance can offer”.

9. STRATEGIC THINKING: PRIORITIES FOR MANAGEMENT Determine the Main Strategic Mandate • Future strategy will be driven forward by focusing on specific operational functions and processes. Define the Strategic Initiatives. • The specific strategic initiatives are identified by individual strategic function or mandate. Each initiative has clear and measurable objectives together with the outline steps to be completed and the resources needed are quantified. “Thinking and exploration might be considered the strategic segment while the planning stage is the tactical segment”.

10. SETTING STRATEGIC DIRECTION: THE PLANNING PROCESS Explained Strategic • Because it involves preparing the best way to respond to the circumstances of the organization's environment, whether or not these circumstances are known in advance • Being strategic means • Being clear about the organization's objectives, • Being aware of the organization's resources • Incorporating both into being consciously responsive to a dynamic environment.  • Strategy lies in making the tough decisions about what is most important to achieving organizational success. “Strategic planning is only useful if it supports strategic thinking and leads to strategic management - the basis for an effective organization”.

11. SETTING STRATEGIC DIRECTION: THE PLANNING PROCESS Explained Planning • It involves intentionally setting goals (i.e., choosing a desired future) and developing an approach to achieving those goals.  • No less, than a set of decisions about what to do, why to do it, and how to do it. • Impossible to do everything that needs to be done • Implies that some decisions and actions are more important than others • Planning is necessary if you want to avoid wasted activity, and make your collective efforts count. “If you consider a strategic plan merely a working guide, and not a formal document for presentation requiring perfected details, then there is a higher probability for successful implementation”.

12. SETTING STRATEGIC DIRECTION: THE PLANNING PROCESS Basics Begin with research • Gather existing information • Discover your human resources • Find Out what people want • Go to those in the know • Research Solutions from other sources • Generate ideas that will lead to your objective, then decide which to carry forward. “The pre-strategic planning stages need to include creative and innovative thinking. This stage should be one of exploring possibilities without constraint, a stimulating and enjoyable part of planning. Thus, think new ideas, explore them, and align them with the purpose of the organization”.

13. SETTING STRATEGIC DIRECTION: THE PLANNING PROCESS Basics Create an action plan • An ordered list of tasks to complete: persons responsible; time-frame; resources required, including materials; facilities and funds. • Keep action plans flexible so you can respond to the unexpected. • Identify priorities and evaluate them • Act more, meet less. Keep time demands modest “Strategic planning for organizations is not considered fun. Strategic planning is often done under duress because it is required. Strategic planning is important yet many such plans are found on bookcases, not on the desktops being used”.

14. SETTING STRATEGIC DIRECTION: NEXT STEPS IN THE PLANNING PROCESS Phase I: The Strategic Plan Document • Finalization of the document • Incorporate a vision/mission and core value statements of the Commission. • Goals and strategic objectives setting. • Road Map-Strategic framework for actualizing the ECOWAS Commission mission in syn with the ECOWAS Vision. • Verbalization and incorporation of the essential text of CDP, MTP, CBP, CP. • Indicate an implementation framework, including the financing plan. “Strategic planning for organizations is not considered fun. Strategic planning is often done under duress because it is required. Strategic planning is important yet many such plans are found on bookcases, not on the desktops being used”.

15. SETTING STRATEGIC DIRECTION: NEXT STEPS IN THE PLANNING PROCESS Phase II: The Planning and Programming System • Specification of the programs, projects, and activities. • Costing of the programs and projects. • Alignment of derived action plans with the budgetary framework. • Development of indicators for implementation, outputs, and outcomes. • Communication and Implementation Plan. • Institutional arrangement and responsibilities. • Instituting strategic planning in the rest of ECOWAS Institutions. • Development of the ICT Infrastructure and links to the MIS. “Depending upon your experience of strategic planning, you either hate strategic planning and think it is a waste of your time or you think it's a great tool for organizational alignment and goal setting”.

16. SETTING STRATEGIC DIRECTION: THE PLANNING PROCESS The Planning Cycle Management Priority/Strategic Initiatives Year-1 July Activity Report Year+1 (March) Draft Budget Program Year-1 August Annual Activity Plan (Based on MTP) Year-1 (October) • Mid-year Execution Report • Year (September) Annual Budget Year-1 (November) Implementation Plan--Retreat Year-1 (December)

17. THE PLANNING CYCLE: MANAGEMENT INTERVENTION Management Committee is committed to the following: • Taking Ownership of the Strategic Plan • Setting Management Priorities/Strategic Initiatives • Reviewing the Annual Budget • Implementation Plan Retreat • Review the Mid-Execution Report • “Planners do not have authority to make commitments, nor do they have managers' access to that "soft" information critical to strategy making”.

18. FINAL NOTES • Appreciating the difference between planning and strategic thinking, makes it is possible for Management to return to what the strategy-making process should be: "capturing what the management learns from all sources and then synthesizing that learning into a vision of the direction that the organization should go. • Planners should: • Supply the data that strategic thinking requires • Act as catalysts who support strategy-making by aiding and encouraging managers to think strategically, and should help specify the implementation steps needed to carry out the strategic vision. • Function as strategy finders, analysts, and catalysts. “The colleagues and subordinates with "planning" either in their title or in their assigned responsibilities should act as described. They should not be told, "Draft the plan." Such commandments usually result in another document for the archives”.

19. THANK YOU MERCI OBRIGADO