Strategic Planning: Prof. Levitt & The Cheshire Cat
Mark Sareffon 11 November, 2014 at 11:11
One of the great joys of retail is its sheer speed.
Things happen fast. When you do stuff, you don’t die wondering.
Many years ago, I started work on a Research Master’s. I sought to understand Strategic Planning in Retail businesses. I chose Retail deliberately for its sheer pace. I figured Retail would be a stress test for ‘slower-paced’ industries.
I interviewed C-suite folk in 18 listed retail companies. Some of them simply laughed at me:
“What value can strategic planning be? A plan’s out of date before the ink is dry.” [TWEET THAT!]
(The answer, ironically, is neatly concealed in that CEO’s challenge.)
By contrast, I was determined to prove, for pretty volatile businesses, this thought from Sun Tzu (before he became fashionable):
‘Now the General who wins a battle makes many calculations in his temple before the battle is fought. The General who loses a battle makes few calculations beforehand. It is by attention to this point that I can see who is likely to win or lose.’ (This hangs framed on my wall)
So, believing in Sun Tzu, I bet the farm on proving that, based on the kind of Planning they do, I’d be able to tell which retailers would perform best.
After 4 years work I began to see the answer. The retailers that were truly killing it had two things in common:
- They stood for something clear that everyone understood.
- They were constantly scanning their world and planning – an ongoing, twitchy process. Virtually to the exclusion of the ring binder that contained ‘the plan’.
I offer you two slightly more recent quotes which expand on Sun Tzu. They’re deceptively simple. I am confident they’re the 2 fundamental principles of planning that all businesses need to follow:
1. Standing for something clear:
“Alice came to a fork in the road. ‘Which road do I take?’ she asked.
‘Where do you want to go?’ responded the Cheshire Cat.
‘I don’t know,’ Alice answered.
‘Then,’ said the Cat, ‘it doesn’t matter.”
Lewis Carroll: Alice in Wonderland, 1865
‘…unless he knows where he is going, any road will take him there’
Prof. Theodore Levitt: ‘Marketing Myopia’, 1960
2. Conducting ‘twitchy’ planning:
‘Plans are nothing; planning is everything.’
General (later President) Dwight D. Eisenhower
Albeit a small sample in my study (non-parametric statistics – for the purists) I uncovered a very strong relationship between 2 major financial measures over 5 years and the nature and quality of each retail company’s strategic planning. In brief, and in today’s language, define your Purpose and then behave like Angry Birds.
Thankfully, I had the last laugh.
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