I recall it like it was yesterday: walking through a massive, class 10 clean room we had built for the extraordinary demands of cellular componentry. I had the privilege of being there when it was commissioned, and in what seemed like 15 minutes, when it was no longer relevant.
That time was measured in years – how quaint.
In the day, it stopped traffic on one of the biggest freeways in Chicago. A massive sky crane helicopter was placing enormous air handling units on the roof of our factory for what would become one of the largest class 10 clean rooms in Illinois. This location was quietly becoming one of the key sources of crucial componentry for the cellular industry across the globe.
Fast forward six years, and the demands of the industry and good supply chain practice of multiple factories collocates with demand, and the facility was decommissioned. Yes…as quickly as the switch was turned on, it was turned off.
My last visit to that space occurred some time later and that pristine room was being used to store dusty old factory test equipment. An ending without good options (we’ll explore a different ending below).
What we need instead are plans that create options – not endings. As Rita McGrath has documented, we are in an era of temporary advantage. Heads down implementation and fixed endpoints are no longer a luxury that a firm can employ.
Coming to a Business Near You
We are undergoing remarkable change in what we are calling for from our organizations. The full effect of digitalization is being felt, as an example, in retail. It’s quite clear that one “channel” will no longer suffice, and firms who are winning are learning to play strong in bricks and mortar, distribution and last-mile fulfillment. Walmart has leveraged all of these to become a major player in curbside pickup, which may be more useful than the front porch drops (only time will tell).
After all, creating a consumer experience is more than just convenient fulfillment – it’s about the full client experience.
Similarly, large food firms are grappling with the implications of their processed foods and associated brands becoming much less relevant. They have answered with new products and the M&A of new product lines and capability, only to find that consumers’ expectations are continuing to shift.
With this change across so many businesses, it’s worth asking the question: how do we avoid building large assets like the above that will need to be scrapped before their time?
The Crucial Final Mile of Strategic Planning
The nuts and bolts of planning have not changed, but how we use them in these turbulent times has. The front end of strategic planning remains consistent, making clear guiding decisions that allow a firm to employ its largest strengths to its clients’ biggest needs.
It’s in the all important backend, where the intention meets investment,that we need to do things in a way that leads to options.
With that in mind, there are three keys to resilient strategy with optionality:
- It’s time bound: This may be one of the biggest shifts for firms that are used to “planning as usual.” Plans need to have clarity of the exit plan as well as the implementation plan. Wargaming out exit scenarios and the leverage and multiplication of people, processes and technology leaves firms in a much better place for new and next.
- It’s testable: In our planning workshops we map out specific early stage experiments that can validate assumptions before large-scale deployment. This testing phase is very useful in keeping the expectations in check while we are finding the best increment of deployment. The goal here is to reward rapid learning while we have options.
- It’s “tranche-able”: Tranche-ing is a financial term that means we partition the release of finance in response to clear proof points.
In the opening example, the facility was one large and inflexible asset. In today’s fast moving world, it would have been wiser to create smaller building blocks that could have been operated independently, with cross utilization of both human resources as well as capital assets. In this way we could have deployed the know how, equipment and processes to their new global locations in a much less traumatic way.
Making use of resilient planning is a key part of what we do in our consulting and workshops. If you’d like to talk more about how this might work for your firm, please contact me at 847-651-1014 or use this link to set up a complimentary discussion.
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