For decades, private businesses have been encouraged to conduct strategic planning, just like the big companies do. After all, how can a business owner expect to generate predictable results if there’s not a plan in place? All this makes total sense on the surface. So why don’t more private businesses have strategic planning processes and strategic plans which are the logical outcomes of such an undertaking?

According to Wikipedia (the poor man’s market research source), strategic planning is defined as an organization’s process of defining its strategy or directions and making decisions on allocating its resources to pursue this strategy. Perhaps the problem starts here. Any definition of any word that includes the word itself is by definition a poor definition. But the reasons strategic planning doesn’t work for private businesses are more fundamental than a simple wordplay.

In the 20th century, three schools of “expertise” emerged to bring the “silver bullet” of strategic planning from Wall Street to Main Street.

  • Virtual boards of advisors whose purpose was to bring outside thinking and big company executive experience to help the private business owner create a strategic path
  • Colleges and associations who saw the small business marketplace as a logical and attractive target market to bring heretofore unavailable expertise to the private business owner
  • Famous authors and consultants who saw their role as to enable and empower the business owner to take their business to the next level.

Unfortunately, the majority of such noble pursuits have been lost on the business owner and his or her firm. Why? Because:

  • Business owners see strategic planning as too “ivory tower and abstract.”
  • An owner’s executive team doesn’t have the training, perspective or confidence to truly participate in a top – down program instituted by an owner, hoping to gain input and buy-in from his or her implementers, who are eager to please.
  • Strategic planning programs are usually parallel to the day-to-day work and deadlines of most privately held businesses. Once the program (or off-site exercise) is completed, the team goes back to business as usual and the plan goes on the shelf.
  • The business owner, by nature of his/her dependence on and investment in their own firms are unlikely to make the investment of time, energy and money needed to take a firm in a truly strategic direction.

So if strategic planning doesn’t work, why keep doing it? Because business owners haven’t been trained in strategic thinking, which I will talk about in one of my next blog posts.

Copyright 2015 Andy Birol All Rights Reserved

Photo Credit: Kyle Van Horn Flickr (CC BY 2.0)