Strategic planning: Time to rethink how we prepare for the future
I am honored to have served for eight years on the faculty of the Graduate School of Banking (GSB) at the University of Wisconsin-Madison. Last year I was asked to create and teach a new course titled “Building and Leading a Culture of Innovation.” I was thrilled to find out it was the highest-rated course in the leadership section.
This year I was asked to lead the course again as well as the strategic planning elective. Those who attended GSB know Terry Saber, who has coordinated this curriculum for many years. As Terry is retiring and looking to the future, she approached me about both courses.
To my surprise, she asked me to shake things up, which was music to my ears! Why would I be challenged to change something that the regulators require our financial institutions to do, and for the most part has worked?
“We are not in an era of change, but the change of an era.” This quote by Pope Francis resonates powerfully for me. Let that sink in. The pace of change that we experience today will never again be as slow as it is right now.
What does this require from us?
The highest performers are changing how they plan, embracing strategic experimentation, evolving to a culture of creativity and curiosity, scanning the landscape for disruptors. Becoming agile enough to jump on opportunities. Being humble enough to realize that what may have worked in the past won’t provide the same returns in the future.
Designing the new curriculum, I incorporated three types of planning and what is right for what the future will require.
Drawing on the work of Jim Davis of the University of Notre Dame’s Mendoza College of Business, here are the three categories of strategic planning:
1. Transactional planning:
- Sustains performance by doing the same thing in a better way.
- Increases efficiency by eliminating waste.
- Improves how assets are utilized/underutilized. A large component involves operational work plans. It doesn’t focus on imagination or a different approach.
2. Forecasted transformational planning:
- Analyzes past performance and identifies patterns to forecast future trends that can impact performance.
- Contrasts historical performance and metrics to anticipated shifts.
- Identifies gaps, which is key.
- Is structured around reducing the gaps from previous performance through necessary organizational and process changes.
3. Revolutionary transformational planning:
- Is the boldest of the three goals of the highest performers.
- Creates the future by redefining industry and regenerating an organization’s advantage. Organizations that embrace the revolutionary mindset often operate with urgency and a sense of passion in shaping and dictating the future.
- Focuses on moving the organization into new lines of business or delivery models.
- Rewards imagination, innovation and originality.
- Fosters think tanks, innovation labs, hubs, incubators or accelerators.
Reflecting on the success of the GSB course last year, I encourage future leaders to examine where they are in their strategic planning journey and striving for the bold. The future depends on it.
Where is your organization at?
Contact Wipfli to learn how we can help your financial institution navigate strategic planning challenges.
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