FOCUS on strategy
the University of Illinois Gies College of Business. Previously, she was the CFO and COO at a global concentrated in investment management and capital markets. Paskvan is a NACD serves on corporate, civic She is a member of the Illinois CPA Society and is professional and industry
You might expect this to be an annual thing, but while many organizations revisit their business strategies annually during their budget processes, those exercises are more about executing plans—how many people to hire, what capital investments to make, etc.— and are not full-fledged strategic reviews. Should organizations and boards revisit and
A
adjust strategy more frequently—especially in a time of upheaval? How should they go about building and executing strategies that can weather storms without necessitating constant revision? What new perspectives are needed in the new normal? Here are three insights I utilize on how to make and execute strategic decisions in turbulent times.
Don't make strategy changes lightly When surprising events occur, it is tempting
to revisit your plans and make changes. But there is an argument to be made that once put in place, strategy should not be changed lightly. In his recent Harvard Business Review article, “When to Switch Strategy in a Crisis,” Mark Chussil discusses his research, which he believes shows that organizations should only consider revising organizational strategy when there are major disruptions to either long-term market conditions or structural and environmental changes. Chussil’s point is that changes to strategic
plans are often reactionary and weaker than the original plan. For a major strategy shift to occur, the future outcome of the revisions must be undeniably better than the expected outcome of the current plan. Leaders must first examine various possible scenarios, including verifying and debating the outcome of making
20 CPAFOCUS July/August 2021
s a result of COVID-19, many companies and their boards are reevaluating their planning processes.
no changes at all. Boards are important partners in that process, vetting and approving strategic plans as well as any major revisions by drawing on their experience and bringing an outsider’s critical eye to the process. Generally speaking, Chussil’s research shows that knee- jerk reactions and changes for the sake of changes are usually worse than the original plan.
Recently, I conversed with a CEO about
their current strategic planning process. One of the more impressive aspects of their planning was the expansive network of experts that the team has accessed, including economists, futurists, industry think tanks, regulators and academics. In all, the executive management team spoke with more than 30 organizations and individuals to proactively evaluate future opportunities and mitigate future risks. Tis CEO undertakes this process every three to four years to strengthen the overall company strategy and anticipate any changes that might be necessary. Te steps they undertook three years earlier using this same process are currently accelerating growth—even during the pandemic. Te idea that strategy should not be
changed lightly makes it even more important that organizations get their strategy right the first time. Here are a few examples of the various resources utilized by companies and their boards during the strategic planning process to get a fresh and unique point of view on how to move forward. (What exact resources you should use should be informed by your business industry vertical and its dependency on market conditions.)
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