Introduction

"If I ran my business like you run the government, I'd be out of business in less than a year. Can't you run the government more like a business?"

Responding to this familiar plea, administrators throughout government say something like: "Government is not like business. Government does not have the universal measuring tool of bottom-line profits. Government agencies do not even have a consistent set of goals. One interest group wants more services; another wants cheaper costs. We're caught in the middle, trying to please everybody. With everybody pulling in so many different directions, it's a wonder anything gets done."

When the President signed the Government Performance and Results Act of 1993 (GPRA, P.L. 103-62), he set in motion a process that will help the federal government to operate more like a business. This Act will create standard goal-setting and performance measurement processes in all federal agencies.

The Act requires all federal agencies to submit a strategic plan by September 30, 1997, an annual performance plan for fiscal year 1999, and a performance report by March 31, 2000. Complying agencies may request waivers releasing them from administrative procedures that currently limit staffing levels, salary and bonuses, and funding transfers among most operating expense categories.

Other articles have summarized the GPRA, overviewed strategic planning to help agencies comply with GPRA, and analyzed the history of strategic planning. The purpose of this article is to show agencies and other not-for-profit organizations the first step in their 1,000 mile journey toward a strategic plan. This journey begins with a plan, a plan-to-plan. But first, a review of concepts from the Performance Strategies strategic planning model is in order.

Review: Strategic Planning Overview

Strategic planning's origins are military. The term derives from ancient Greek, meaning literally, general of the army. Strategoi were generals of Greek tribal armies who carried the day at Marathon, nearly 2,500 years ago. They were elected political leaders; they left battlefield tactics to troop leaders, but ruled on policy issues as a group.

Definition

Strategic planning is a continuous and systematic process where people make decisions about intended future outcomes, how outcomes are to be accomplished, and how success is measured and evaluated.

Key words in this definition include:

"...continuous..." Strategic planning is ongoing; it does not end with the publication of a plan; its success depends on it purposefully becoming an uninterrupted, and never-ending cycle.

"...systematic..." Any effective strategic planning process has a deliberate and specific methodology and a sequence of events; it is never haphazard.

"...process..." The value of strategic planning lies more in the journey than the destination. While strategic planning must indeed produce a product, a Strategic Plan document, the primary value comes from the teamwork, vision, commitment to and ownership of organizational success the planners gain through the process of making the decisions the document contains.

"...people..." A strategic planning process must involve all the right people, and those people must be ready and willing to contribute to the process.

"...decisions..." Strategic planning is a decision making process. Organizations that are ready to plan strategically have leaders who are ready to make decisions.

"...outcomes..." Strategic level planning addresses external results, or the organization's effects on the outside world, particularly how it affects its customers. An old adage states: "If you don't know where you're going, any road will take you there." Strategic planning is primarily about defining where "there" is, a type of roadmap outlining the outcomes and results designed to be achieved throughout the journey.

"...how outcomes are to be accomplished..." Planners don't quit just because they defined the target future; they go ahead and select the roads that will get them there.

"...how success is measured and evaluated." Strategic planning is all about succeeding. A well-written strategic plan will describe clearly how anyone can tell whether the organization is successful. The plan may measure intended future outcomes either quantitatively or qualitatively, but it always defines threshold criteria for achieving success.

Elements

Every strategic planning model should contain seven elements: the first, the plan-to-plan, is unique to the Performance Strategies model; the other six basics are: mission, needs assessment, strategic objectives, outcome measures, strategies and performance feed-forward. The Performance Strategies model below adds one more element--strategic priorities--and expands on the components in the mission statement element.

Figure 1. shows how these elements relate to each other. The arrows indicate the general sequence of the elements, but planners often find themselves backing up to re-examine an element they had already drafted. The elements are iterative, and truly a "continuous process."

Figure 1. Strategic Planning Cycle

A brief description of each element follows:

• The plan-to-plan is a project plan that describes how the organization will develop its strategic plan. This article will discuss the plan-to-plan in detail, later.
• The mission, goals and values element contains the broadest possible description of the organization's vision of its future. This element deals with all the philosophical aspects of the organization's management. The GPRA requires, "...a comprehensive mission statement covering the major functions and operations of the agency...." In addition, organizations may want to define goals and values in this step. Goals are written statements describing the external direction of success, ultimate achievement, or improvement in organizational performance. Values are written statements describing the principles the organization wants to express as it works to move in the direction described in the goals.
• External needs assessment is an appraisal of the key outside trends and forces that influence the success an organization will have in achieving its mission and goals. These external trends and forces may pose either an opportunity or a threat to the organization, such as changes in economic conditions, population, technology, environment, or statutes. Some planners call this element an "environmental scan." The GPRA refers to this element as, "...key factors external to the agency and beyond its control that could significantly affect the achievement of the general goals and objectives...."
• Strategic objectives are written statements that describe an intended outcome. They clearly describe measurable targets of achievement. The GPRA mandates: "...general...objectives, including outcome-related...objectives, for the major functions and operations of the agency...."
• An outcome measure is a yardstick, or standard, used to measure success in achieving a strategic objective. It measures how well an organization is doing. As one type of performance measure, it indicates the actual impact of the organization's activities. Every strategic objective has an accompanying outcome measure, and the outcome measure uses terms identical to the strategic objective it measures. By comparing the quantity or quality in the outcome measure to the strategic objective's performance target, management can state clearly whether or not the organization achieved its strategic objective.
• Strategic priorities rank each strategic objective according to its relative importance to the organization. Setting strategic priorities is a management decision. These priorities will guide budget and resource requirement decisions later.
• Different strategic planners use and define "strategies" in many different ways. Here, a strategy is an approach, or an implementation methodology, that will lead to achieving a strategic objective. The GPRA requires, "...a description of how the goals and objectives are to be achieved, including a description of the operational processes, skills and technology, and the human, capital, information, and other resources required to meet those goals and objectives...."

  In the strategies element, planners identify all the alternative approaches, rate them according to criteria such as timeliness, projected cost or effectiveness in achieving a strategic objective, and then select a set of strategies that will best achieve the performance target specified in the strategic objective.

• Performance feed-forward is a systematic procedure for comparing actual performance to planned performance, and for using that information to improve subsequent planning cycles. Other terms frequently used to describe this procedure include program evaluation, management evaluation, management audit or continuous improvement processes. The GPRA requires strategic plans to contain: "...a description of the program evaluations used in establishing or revising general goals and objectives, with a schedule for future program evaluations."

Benefits of Strategic Planning

The strategic planning process can improve an organization's efficiency, effectiveness, decision making, teamwork, ownership, and quality.

Strategic planning unifies the entire organization behind a single set of marching orders. It improves effectiveness by creating a synergy of individual efforts that advances the organization much more rapidly toward its goals. It can also improve efficiency by helping the organization eliminate the paralysis and inefficiency of activities that work at cross-purposes.

The most valuable benefits of any strategic planning effort lie in the process, rather than in the product. In some cases the product, the final document, may be out of date shortly after publication, due to changing circumstances and policy amendments. The process benefits, however, will be far more enduring: the strategic planning process compels organizations to develop a consensual vision of the future.

Achieving consensus requires the open and constructive participation of everyone in the organization's management. Some organizations also involve their customers and major suppliers. Participation brings necessary conflicts to the table, where they belong. The strategic planning process provides an appropriate forum and a facilitating structure to resolve conflicts into solutions and decisions. Resolving underlying conflicts may be difficult or painful, but practitioners often find that strategic-level agreement helps to resolve even more-divisive conflicts about the how's inherent in implementing organizational programs.

Because it focuses on purpose, participatory strategic planning can improve teamwork among policy-makers. Better teamwork enhances the synergy effect, to improve effectiveness.

Participatory strategic planning will also improve participants' ownership of the plan, because people always own what they help build. A greater sense of ownership increases the likelihood that managers will actually implement their plans. Adapting a phrase, "If we plan it, we will build it."

When an organization integrates its strategic planning process with its budgeting process, managers can focus more clearly on organizational outcomes and priorities. They can use performance feed-forward to improve program effectiveness, as another tool in their continuous quality improvement kit.

Plan-to-Plan Purposes

Achieving all these benefits requires a strategic planning process that is well thought-out and organized. Planners learn: "You need two 'P's for Accomp_^^plishment: Planning and People." The key variables are the sequencing of the elements or steps, and the participation of the relevant people.

The organization must plan its strategic planning process. The elements in a strategic planning process have a logical order to them. Generally planners must complete one element before moving on to the next, even though they may occasionally need to go back and make changes to earlier steps.

The strategic planning process must involve all the right people. Improvements in efficiency, effectiveness, decision making, teamwork and quality all depend on achieving a high level of ownership. All the people who will implement the plan must feel that the plan is their plan, that they own it.

The plan-to-plan is the step where the planner describes the sequence of the strategic planning steps, and lists the participants at each step in the process. A battle plan lists the participating units, and tells each participant what to do, and when and where to do it. Similarly, a strategic plan-to-plan lists the participants invited to each step in the decision making process, describes the types of decisions they will make, and when and where they will make these decisions.

If the planner skips the plan-to-plan, the process will likely falter: participants will discover they have insufficient information to make the key decisions on the table, or they will find that key people are not at the table participating in the decision making process.

The purposes of the plan-to-plan are:

1. To define top management's commitment to the strategic management process.
2. To set the planning horizon.
3. To list the people who will contribute to each step of the process.
4. To outline the major steps, or tasks, in the strategic planning process.
5. To set the sequence and timetable of events.
6. To identify strategic planning barriers, and ways to overcome them.
7. To identify factors that will facilitate strategic planning, and then capitalize on them.

Management Commitment

Effective strategic planning processes involve both top-down and bottom-up inputs; therefore, top management commitment to the process is essential to success. People throughout the organization must see and believe that top management--the CEO, president, vice presidents, service secretaries, chiefs of staff, division and department heads, commanders and other executive level managers--wants this process to succeed.

Everyone in an organization wants to improve performance, eliminate duplication of services, and coordinate programs and activities. As they learn more about strategic planning, they may see how they can use it to achieve these ideals, but only if top management commits itself to making strategic planning work.

People must believe that their contributions to the process will ultimately have an effect. They don't need to believe that top management will adopt all the ideas they propose, but they do need to believe: (1) top management will make the strategic decisions the planning process puts on the table, and (2) top management will implement the decisions that result.

Too often, people throughout an organization are skeptical about the "management fad of the month." From PPBS, MBO and TQM, to Zero Base, One Minute and Seven Habits, veterans have seen the good, the bad, and the paperwork. They remain frustrated, ultimately, by the lack of decision making and follow-through. Strategic planning will become just another meaningless exercise unless top managers convince the rest of the organization that they will make the decisions, and achieve the results.

Commitment means the manager wants it, will make it happen, and will create whatever structures the process needs. This idea contrasts sharply with the notions of participation--top management sees the benefits of the effort, does everything expected, and follows the "letter of the law"--and attendance, which means top management shows up, but may or may not participate, and cares little whether the process succeeds. Analogously, chickens "participate" in a bacon-and-eggs breakfast, but pigs are "committed." Successful strategic planning requires commitment from top managers.

Demonstrating top management commitment is difficult, because management must exemplify its commitment every day. The usual enthusiastic memo kicking off the process is insufficient. Executive managers must support the strategic planning process at every opportunity: attend and participate at every meeting; read and either change or approve the interim products; refer to strategic planning's value in every speech; provide meaningful feedback to people who contribute to the process. A single negative word about the process can derail months of demonstrations of top management commitment. Message discipline--consistency and repetition--is critical for people to believe in top management's commitment to the process.

The plan-to-plan should show top management commitment in part by allocating the resources that will be necessary to complete the strategic plan. These resources include the time that the decision makers will spend in meetings and retreats, impartial facilitators contracted to train participants and manage the discussions, and management analysis time provided by a small support staff. Putting resources behind a project is a proven demonstration of commitment.

Planning Horizon

GPRA requires strategic plans to look at least five years into the future. Plans published September 30, 1997, will therefore have a planning horizon extending at least through federal fiscal year 2002.

Many organizations will recognize more distant horizons. Programs driven by long-term demographic trends--such as the Department of Veterans Affairs--may want to look beyond 2002, to a time after Vietnam-era veterans' medical care needs will peak. Programs requiring long technology development and procurement cycles, such as the Ballistic Missile Defense Organization or the Federal Aviation Administration, may want to look beyond the current procurement cycle to define the next generations of technology. These types of concerns carry organizations' strategic plans to the years 2015, 2020 or beyond.

Many public sector organizations tie their planning horizon to the terms of elected policy-makers. GPRA does not currently allow this approach, as the required horizon extends beyond even the next administration's term.<

Whichever planning horizon the organization selects, all the other strategic planning steps and analyses should anchor to that date.

People

Strategic planning is a people process. People make the decisions that the strategic plan contains. For each element in the strategic planning process, the plan-to-plan should list the people whose involvement will be necessary. The plan-to-plan may also invite others whose input will be valuable, but not required, such as outside stakeholders.

One key reason for listing participants at each step of the process is to make sure each step involves all the right people. By listing all the people invited to each meeting, the planner can ensure the list contains no omissions, and correct any oversights.

Another reason to list participants at each step is to ensure that everyone knows what the organization expects of him or her in the strategic planning effort. By looking at the description of the assigned tasks, participants should be able to estimate reasonably how much time they need to allocate, and schedule their time appropriately. A good idea is to publish both a people-by-task list and a task-by-people list in the plan-to-plan.

In many public sector organizations, outsiders also want an opportunity to input their ideas and perspectives to the decision making process. Outsiders with relevant views include both customers and suppliers. Designing opportunities for outsiders' inputs will generally strengthen the strategic plan, though it adds time and trouble to the process. The primary types of outsiders' contributions include: (1) descriptions of customers' problems that the plan will address, as a part of the external needs assessment; (2) stakeholder comments and suggestions for setting priorities, after the planning team has drafted strategic objectives; and (3) customers' first-hand testimony and insight into ways to improve effectiveness, as a part of the performance feed-forward process.

The plan-to-plan should also identify how the planning team will reach out to these outside stakeholders, and make sure they become part of the process.

Elements and Steps

The strategic planning process is systematic; that is, each element follows a series of steps in a logical sequence. The plan-to-plan should describe these steps, or tasks, in the strategic planning process, the types of decisions that participants will make at each step, and the resources that each step will require.

The strategic planning process that the plan-to-plan describes must contain at least the following elements: mission, needs assessment, objectives, outcome measurement, strategies and performance feed-forward. So long as it addresses these six basic elements, the plan-to-plan may add any other elements that will be useful, such as: vision, philosophy, goals, value statements, internal needs assessment, strategic priorities, or a tactical planning cycle.

For each element, the plan-to-plan should describe the objectives of the element, the activities or steps that will lead to completing the objectives, and the deliverable products that will mark success in completing each activity and achieving the objectives.

The following paragraphs show an example of what a plan-to-plan might contain:

Element: Mission Statement.

Objective: To achieve consensus among agency executives on a statement describing the agency's purposes, goals, primary functions and legal authority.

Activities and Deliverable Products:

• Legal Division compiles and summarizes a guide to the agency's statutory authority by November 15.
• Research Division surveys a sample of customers and documents their opinions about agency purposes, by November 15.
• All section managers analyze their sections' functions and submit analyses to their division directors by November 1.
• Division directors compile functional analyses and submit them to Strategic Planning support staff by December 1.
• All division directors and higher-level executives attend planning retreat December 15-18 at Denver training center, to draft a consensus agency mission statement and goals.
• Executive Committee reviews and considers approval of agency mission statement and goals at the January 7-8 quarterly meeting in Miami.
• Executive Committee publishes final approved mission statement and agency-wide goals January 15.

Sequence and Timetable

The sequence and schedule that the plan-to-plan describes will show participants what they are to do, and when they are to do it. They also show people how they can use the process to influence strategic decisions.

For the strategic planning process to be systematic, the planner must sequence the steps in a logical order. For example: Needs assessment should precede setting objectives, because the decision makers must know how serious a problem is before they can set the intended performance level. Objectives must precede priority setting, because decision makers cannot set priorities if they do not know the range of activities they are ranking.

The plan-to-plan is just a project plan for how to develop a strategic plan, so standard project planning techniques and tools apply. A variety of computer assisted project planning application systems are available for sequencing and scheduling events in the plan-to-plan.

To lay out a sequence of events, a PERT chart--similar to a flow chart--is the most appropriate technique. The PERT chart should clearly show the dependency relationships among the strategic planning steps, and will make any logical errors obvious. Used properly, a PERT chart can also help planners analyze the impact a delay in any step will have on the overall project schedule.

The plan-to-plan should also show when each step will occur, so that participants can schedule their activities. To show the timing of all the steps in the process, the standard technique is Gantt charting, which plots tasks against time in a matrix, with a bar spanning the time allocated to each task. This technique will highlight any scheduling conflicts among participants, staff or other resources, so that corrective action can precede the actual events.

Publishing the task list, sequence and schedule of events has another benefit important to participatory managers. The plan-to-plan will show people how to get the most impact from their advocacy activities. The plan-to-plan should be a manual showing people when and where to voice their concerns so they will be most effective. For example, the right time to raise the issue of how many simultaneous conflicts the U.S. should prepare to fight is in the goal-setting and needs assessment steps. By the time the planning team begins writing objectives, it has already reached consensus about this issue; raising it at the later strategic objectives step would not be productive.

Skeptics might argue that a plan-to-plan will bring dreaded special interests out of the woodwork, and slow down the process. People not invited to the process might impose themselves at key points, and disrupt an otherwise harmonious meeting of minds. In a worse-case scenario, these "gate crashers" could obstruct a well-laid-out, orderly process. Others might counter that these interests will come out anyway, and with a plan-to-plan the planning team can direct them to provide their input at appropriate times and in appropriate forums; after all, in a democracy, everyone deserves a hearing.

Some of the people who want to participate in the process, or who want to affect the strategic decisions, are not uninvited guests; rather, they may be the key players at the table. These key decision-makers need guidance, too, though they may fear that asking for guidance could signal a lack of support for the strategic planning process. Strategic planning is not a familiar process in most public sector environments, and few career administrators or field commanders have experience with the process. Some of these key players may have previous corporate experience with strategic planning, and will be familiar with the concept, but generally they will not know how to practice strategic planning in a government environment.

The plan-to-plan should give explicit instruction, to get the most out of the people on whom an effective decision making process depends.

Barriers and Facilitators

Even a well-planned operation needs luck to be successful. Eliminating serendipitous influences is a good idea, but not a likely outcome. A little bit of effort, however, can improve the odds significantly. By identifying barriers and facilitators to an effective strategic planning process, listing ways to overcome those barriers or capitalize on the facilitators, and publishing them in the plan-to-plan, a planner can put everyone on notice of what to look for, and what to do if it happens. Another name for this part is contingency planning.

What are the major factors that can derail or facilitate a strategic planning process? Most will vary with the organization. Planners should ask, "What could possibly happen to prevent this plan from reaching implementation on time? What can we use or make happen to expedite this plan reaching successful implementation?"

One organization the authors worked with had a three-member appointed governing board. Shortly after completing the strategic and tactical plans, one member's term expired, as expected, but at virtually the same time, another member unexpectedly died in office! Both of the appointed successors represented a different political party, changing the board's political majority, its priorities, some of its strategic objectives, and its organizational structure. This organization had integrated its strategic planning and budgeting processes, however, so implementing the changes caused little disruption.

Few organizations will feel the need to plan for such a radical shift in policy; nevertheless, an unanticipated change in the organization's top management during the one or two years of an initial strategic planning effort may not be so far-fetched. Elections in 2000 and 2004 could cause major policy swings throughout the U.S. government, as occurred in other political times. Such an event could radically affect the level of top management commitment to the strategic planning process. One contingency strategy may be to ensure that second-level managers' commitment to strategic planning is as strong as the commitment of top-level management.

Other contingency plans that may convert barriers into facilitating factors for effective strategic planning may include:

• Staff resistance to a changing system: Few people like change, and a new planning process will frequently mean changes in agency operations. Fearful staff members may effectively sabotage the process, just through passive resistance. Counter-strategies focus on communications to overcome staff fears: regularly solicit strategic planning ideas from "the troops;" publish progress reports about strategic planning activities and events through E-mail and post them on an intranet web site; open strategic planning training sessions to everyone; conduct "town hall" meetings to answer employees' questions; make videotapes of these meetings available to employee groups.
• High expectations versus limited resources: The planning staff and the budget staff tend to give a mixed message. The planning staff asks managers to approach issues from a broader perspective, identify new ways to solve old problems, and develop a strategic approach to managing issues. At the same time, the budget staff tells managers that funding increases are non-existent, "downsize" is this year's buzz-word again, and the old rules restricting management flexibility will remain. This message mixes the "pie-in-the-sky" of planning with the "cold leftovers reality" of budgeting. A good strategic planning process can help to resolve this conflict, if it includes multiple priority-setting activities throughout, and not just at the budget-setting end.
• Minority-position views ignored: Some people consistently find themselves advocating positions not shared by most people in the organization's management structure. These people may be skeptical of strategic planning, believing it is just another way the organization can ignore them. A good plan-to-plan will demonstrate to these people how the strategic planning process will use consensus-building processes to recognize and resolve these types of conflicts.
• Availability of resources for strategic planning: Some managers may fear that the strategic planning process will divert valuable resources away from other pressing priorities. Indeed, strategic planning is not free. Most of the costs are the time that managers throughout the organization will spend in group decision making processes. Strategic and tactical planning activities are basic functions for anyone with the word "manage" in his or her job description. Organizational salary budgets have therefore already allocated these costs. Most organizations will also hire facilitators for these group processes, and many will have a small staff to support the strategic planning activities. These additional costs should represent only a fraction of one percent of an organization's budget.
• Denial of Congressional approval: The GPRA preserves Congress' right to change an agency's strategic plan, "...to establish, amend, suspend, or annul a performance goal." (31 USC 1115.) As always, government agencies operate subject to the checks and balances of the American branch system of government. Successful agencies will write their strategic objectives, which drive the performance goals, in terms that are external to the agency, showing the impact of agency activities on its customers. In most cases, the agency's customers include the constituents to whom successful members of Congress are most responsive. To the degree that agencies can connect what they do to the external effects they have on constituents, agencies can expect little strategic re-writing from Congress.

Summary

The Government Performance and Results Act of 1993 requires all federal agencies to publish a strategic plan by September 30, 1997. Agencies should have started right away to design their strategic planning process, and publish those designs in a document called a plan-to-plan.

The purposes of the plan-to-plan include: to demonstrate top management commitment to the strategic planning process; to set the planning horizon that the strategic planning process will target; to list the people who will participate in each element of the process; and to list the activities, sequence and schedule of events.

While different practitioners will have different models for a strategic planning process, they should all share six basic elements: mission statement, needs assessment, objectives, performance measurement, strategies and performance evaluation. Other elements may also be useful, including vision statement, goals, philosophy, priority-setting and a tactical planning cycle. Performance Strategies recommend that strategic plans, like a battle plan, also include a plan-to-plan that sets out the elements that the agency intends to use, and describes who will do what, when and where.

Strategic planning has been a major management tool for businesses for decades. The GPRA makes this tool available to government agencies, to help them "run more like a business." Successful governmental strategic planning requires careful thought about the process, as well as about the substance. Agencies that skip the plan-to-plan step will likely see their strategic planning process collapse under the pressures of getting the right people together with the right information at the right time. Agencies that take the time to write a plan-to-plan will fight their procedural battles early, resolve them, and then focus their attention on solving the agency's most pressing problems through the strategic planning process.

Notes

¹A version of this document was originally published in Armed Forces Comptroller magazine, vol. 39, no. 2 (Spring 1994), pp. 21-26.

²Phillip Blackerby is a Principal with Blackerby Associates, Inc., whose mission is to help any organization transform into a high-performance enterprise. An experienced management consultant, Mr. Blackerby's public sector experience includes positions in the National Institute of Standards & Technology, as Associate Deputy Treasurer of Texas, budget director for the Texas Comptroller of Public Accounts and planner for the U.S. General Accounting Office. He has also served on Boards of Directors for several not-for-profit organizations, and operated four private sector businesses. Mr. Blackerby invites readers' comments. Return