Here’s what’s growing:

• Shortage of raw materials and development of new materials: With the cost of oil on the rise, demand for non petro-chemical-based materials is increasing. Same goes for other natural resources.
• Increasing population: By 2050, the global population is estimated to reach 9.2 billion people.
• Environmental sustainability: Huge opportunities exist with reusing, recycling, and creating biodegradable products. Clean energy is booming with solar cells, wind turbines, and eliminating preventable energy loss.

Leave it to DuPont to develop a product to replace plastic. Its newest product is called Sorona, a corn-based version of plastic. DuPont clearly identified the growing threat of high oil prices, and turned it into an opportunity by creating a solution. Sorona, referred to as the new nylon, is expected to hit the streets in a few years and could soon be in everything from underwear to carpet.

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A strategic plan provides a business with the roadmap it needs to pursue a specific strategic direction and set of performance goals, deliver customer value, and be successful. However, this is just a plan; it doesn’t guarantee that the desired performance is reached any more than having a roadmap guarantees the traveler arrives at the desired destination. Remarkably, the majority of companies who have strategic plans fail to implement them. In fact, according to a Fortune cover story in 1999, nine out of ten organizations fail to implement their strategic plan.

We believe the new execution module helps you plan more effectively and use your time more efficiently to make more informed decisions with features like at-a-glance tracking that identifies goals and action items as completed, pending or overdue. But we encourage you not to overlook the components necessary for supporting a successful implementation. Consider these five key elements:

1. People – Make sure you surround yourself with the right people on board with the right competencies and skills to support your plan.
2. Resources – You’ll need sufficient funds and enough time to support implementation. True costs can include a realistic time commitment from your staff  to achieve a goal, a clear identification of expenses associated, or unexpected cost overruns by a vendor. Be prepared as well that employees will need enough time to implement what may be additional activities that they aren’t currently performing.
3. Structure – Be sure to set your structure of management, appropriate lines of authority, and clear lines of communication with your employees. A plan administrator and regular strategy meetings are two of the easiest ways to put a structure in place.
4. Systems – Both management and technology systems help track the progress of the plan and make it faster to adapt to changes. Be sure to include milestones with achievements and specified time frames as part of you plan.
5. Culture – Create an environment that connects your employees to the organization’s mission and that makes them feel comfortable. You can reinforce the importance of focusing on strategy and vision by rewarding success. There should be some creative positive and negative consequences for achieving or not achieving the strategy so people make it a priority.

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Consider G-Sky, a Vancouver, British Columbia, company that installs green roofs – vegetation and soil covered roofs that help lower heating and air-conditioning costs along with dramatically reducing rainwater runoff. According to an article in Business 2.0, the total square footage of green roofs in the United States is already growing at the healthy rate of 125 percent a year, and now some entrepreneurs like G-Sky are “placing (their) bets on something even more forward-thinking: green walls”.

Green walls can provide as much bill-saving insulation as green roofs, and they put less load-bearing strain on the building. They can also help offset the urban heat island effect caused by heat-absorbing city surfaces that can raise temperatures as much as 8 degrees higher than the surrounding countryside. When G-Sky started looking long-term, they saw a world where “carbon-trading is king and companies are eager to offset their greenhouse gas emissions”. Now, G-Sky is installing plant-filled wall panels that can go on any vertical surface – meaning that “G-Sky just quintupled its opportunity” since for every roof there are four walls. Early G-Sky clients include Whole Foods and the W Hotel chain.

What can we learn from this trailblazer?

• Build on your company’s strengths: Your strengths encompass everything that your company does well. Consider your company’s capabilities, skills and resources and draw on them to execute plans and actions.
• Consider your operational processes: What do you already excel at that might have other applications? G-Sky identified an opportunity to grow their business 4X with their existing expertise!
• Capitalize on any opportunities that may exist: Keep in mind that opportunities may be political, social, environmental or technological.

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• In the general administration area, the newspaper’s invoices only offered one method of payment, when there were actually three ways to pay. The publisher immediately revised the invoices to include all options. The cost to the company was next to nothing as they were computer-generated. Decrease in delinquent accounts: 40 percent.
• In the human resource management area, the organization’s high turnover rate made customers question the viability of the newspaper. The publisher instituted a more rigorous hiring process that included a third-party skills and personality assessment to make sure that the right people were “on the bus.”
• In the area of technology, the newspaper didn’t have an online renewal form. This feature was quickly added, which allowed subscribers to maintain their subscriptions with a click of their mouse instead of calling, faxing, or snail mailing in their renewal forms.

Don’t these changes seem obvious and straight-forward? It’s easier to see the errors of others or after someone points them out to you. Well, it wasn’t until the publisher used the value chain that he realized where the links were broken. The organization’s core product is highly regarded in the community, but the supporting activities were hindering business growth.

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Want a good example of franchising? Great Harvest Bakery has successfully opened 206 franchises nationwide with an unusually loose model. The company encourages entrepreneurial spirit and open communication between storeowners, who enjoy the freedom to run their businesses their way. In fact, the Uniform Franchise Offering reads: “Anything not expressly prohibited is allowed.” Because the company is privately held, financial information isn’t available, but its continued growth, with 13 stores expected to open this year, is an indicator that the company developed a very successful partnership model.

Wonder why you wouldn’t want to franchise?  Check out Jamba Juice, the maker of fruit-juice smoothies. They backed away from franchising as a growth strategy specifically because of the inability to control product quality. At the time the company was making the critical decision about how to grow, founder Kirk Perron decided that consistency in location, store design, in-store merchandise, and smoothie ingredients was what would lure repeat customers. By franchising, Jamba Juice didn’t have the ability to monitor the quality so important to the company’s distinctiveness. Opening wholly-owned stores funded by a handful of big name venture capitalist proved a winning strategy for the company. The company now has 500 stores nationwide with net sales of $300 million in 2005.

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Years later, America Online is now the biggest ISP. Prodigy and CompuServe are virtually unheard of anymore. How did America Online win the war? The folks at AOL understood two key things customers valued at that time:

• Personalization of accounts: A person could get an e-mail address like joesmith@aol.com from AOL whereas Prodigy assigned him the e-mail address JS12345@prodigy.com, and CompuServe assigned 56789@compuserve.com. As a customer, I want my name if I can get it, or something else that is personally meaningful to me, like a personalized license plate from the DMV at no extra charge, would you do it? Most people would.
• Fewer rules: AOL has fewer rules governing the virtual community of chat rooms and bulletin boards. People could pretty much talk about whatever they wanted to in cyberspace within AOL, whereas CompuServe and Prodigy had more restrictions on that kind of activity. Naturally the virtual community growth was viral, multiplying their user base tenfold.

Over time, most people picked AOL over the competition. AOL went for customization and personalization against the bigger, more well-funded competition. That’s using competitive advantage to dominate your space, to grow, and to become successful!

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The Anthropologie customer is affluent but not materialistic. She’s focused on building a nest but hankers for exotic travel. She’s like to be a domestic but has no problem cutting corners (she prefers the luscious excess of British cooking sensation Negella Lawson to the measured perfection of Martha Stewart). She’s in tune with trends, but she’s a confident individualist when it comes to style. She lives in the suburbs but would never consider herself a suburbanite.”

Can you visualize Anthropologie’s customers? Without a doubt! Now don’t worry if your customer profile isn’t this specific. In fact, it probably won’t be. Not everyone in this company’s market exhibits all of these traits; that would be too narrow. Nevertheless, this example illustrates the power behind really, truly knowing your customers. You can immediately see how this profile helps the company select which products to carry in the store, what messages to use in the advertising campaigns, how to price the merchandise, and what type of customer service drives repeat business.

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View strategic plan examples.

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A recent New York Times Magazine cover story chronicled the rise of Toyota from one-time textile loom manufacturer to “not only the best automaker in the world, but also maybe the best corporation”. Indeed, according to that article, Toyota has just about every major company in the world asking the question: “What can we learn from Toyota?” In fact, “what you can learn from Toyota is something even Bill Gates has pondered publicly.”

What doesn’t surprise anyone familiar with Toyota’s strategic history is that the company “never makes rash moves or false promises.” One obvious example of Toyota’s approach is the Prius hybrid. Jim Press, president of Toyota Motors North America, said that ‘about the same time the Prius made its debut, Ford rolled out the huge S.U.V. franchise’ even though ‘both of us had the same tea leaves, the same research. One of us bet on hybrid, one of us bet on big S.U.V.s.’ Toyota pondered, according to Press, that ‘First of all, long term, is fuel going to get cheaper or more expensive? Is oil going to become more plentiful or less plentiful? Is the air going to become cleaner or more polluted? And so, do you do something proactive and innovative, to be in tune with where society is going? Or do you hold on to where it has been, and then don’t let go, to the bitter end?’ Toyota’s overarching principle, according to Press, is ‘to enrich society through the building of cars and trucks’, and the company’s decision to pursue hybrids ten years ago was the answer to the question, ‘What’s the right thing to do to sustain the ability to sell more cars and trucks?’

The New York Times Magazine article quoted a Toyota employee who said that ‘Toyota expects to be in business 100 years from now, long after oil has been depleted or rendered unusable because of its carbon content, and for that reason it has placed all its bets on hybrid technologies.’

Is your business equally prepared?

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According to a recent study by M3 Planning, a nationwide leader in on-demand strategic planning services, businesses that use strategic planning are 12 percent more profitable. The results from the 2006 M3 Planning Strategy Benchmark of 280 firms in the United States found that by just adding strategic planning to a business’ activities, organizations can experience an increase in net profit. Those firms whose top management had a high commitment to execute strategic planning reported an 80 percent increase in sales volume during that year, and firms whose top management had a lower commitment reported a 59 percent increase. (For more information or to view full results see the report.)

I think it’s important to stress here that successful strategic planning is a continuous process. It isn’t just a one-time event; you need to make it a habit. I know how easy it is to get lost in the process, especially when you’re also in the middle of your organizations’ everyday operations, and in the coming weeks I’d like to share some suggestions that should help you embed successful strategic planning concepts into your organization. Consider them an easy-to-follow Strategic Planning Process Checklist to help keep your team on track.

First, I urge you to “Get Ready and Get Organized”. This may sound elementary, but you’d be surprised by the number of businesses that sabotage their strategic planning efforts by poor preparation. Take your time here; this is about your past, present and future. I encourage you to identify the specific issues and choices your strategic plan should address. I’ll elaborate on this topic later, but for now you should start thinking about where it is exactly you want your organization to go. (i.e. Start thinking “big picture” and “end game”) Determine your organizational readiness. (i.e. Do you have complete commitment and support from top leadership and key management? Is yours a culture that is open to looking beyond the status quo to find new ways of doing things?) Create your planning committee (i.e. Who will you rely on to implement your strategic plan? Who will be you plan administrator and who will be your most valuable players?). And finally, identify the information which must be collected to help make sound decisions. (i.e. What reporting is necessary to access your current situation and measure your efforts in reaching your goals?) A plan is only as good as the information on which it’s based. Don’t rely on assumptions or hunches. Again, I can’t stress enough that you can never underestimate the power of preparation and research.

Please join me as we continue down the Strategic Planning Process Checklist in this space. Next time, I’ll discuss “Articulating your mission and vision”. Meanwhile, keep in mind that success is not a matter of chance, but rather success is a matter of choice.

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