How To Get Better at Strategic Planning – Part 1 Shareholder Objectives

How To Get Better at Strategic Planning – Part 1 Shareholder Objectives

First, a definition of Strategic Planning. It is a practical process that produces a clear strategic vision for the business, generates a compelling positioning statement and therefore, in context, delivers an aligned set of operational actions to get you there. That’s it. Now to pull that off you’ll need to understand your markets in depth, why you can win in those markets and of course you’ll need to understand the historical performance of your own company. That process will be covered in Part 2. Today’s post covers the vital pre-strategic planning phase in a private company –  What do the shareholders want to achieve? What’s the end game of this little vehicle you call “My Business”. If the shareholders are not on the same page, then the strategic plan becomes an academic exercise.

Defining Shareholder Objectives Session:

This is always a delicate discussion but an absolutely essential one to have. I’m assuming two to ten key shareholders in these guidelines, but even if you are the only shareholder, perhaps the exercise is worth doing with a trusted adviser. In any event given the delicate nature of these discussions we recommend appointing a facilitator to chair this session (shocker, we conduct these on behalf of clients).

  1. Each shareholder should be given time to share their thoughts on a one to one basis with the facilitator. This helps each person discuss their objectives with no peer group pressure. It also allows the facilitator to frame the agenda for the group session.
  2. Possible topics for the one to ones, to make people really think about their objectives could include:
    • What’s your career plan and how can the business help fulfill those objectives?
    • Are there any compelling personal events arising in the next 3 to 5 years that inform what you want to do in the business?
    • Are you happy that the company remains independent?
    • Do you expect or desire a cash event to crystalize your wealth in the business?
    • Are you happy with the current direction of the company and the strategic plan?
    • Do you see any conflict between the company’s current objectives and your personal objectives?
  3. A group session is then held and the agenda will be formed based on the answers garnered in the one to one sessions. Typically the group session will then cover:
    • Conflicts between shareholder objectives covering the next three years
    • Possible future strategic scenarios for the business
    • Operational issues that rise to a strategic problem
    • Potential solutions to align all shareholder objectives
    • Agreed actions

By reconciling these personal shareholder objectives with the corporate strategy on a regular basis, you avoid huge disappointment and mutual mystification between shareholders, management and all employees. This alignment will bring a new level of energy, passion and commitment that will engulf all stakeholders, driving them towards a common goal. Once all shareholders are in alignment it’s then possible to conduct an enjoyable, insightful and effective strategic planning process which I will cover in Part 2.

TPP offers operational expertise to scale your business organically or by acquisition. We continue to transform visions into remarkable businesses. We are currently conducting several strategic planning exercises for clients.

 

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