With the arrival of January and the conclusion of December, enterprises are keen on ending the previous year’s tasks. Executives have to wrap up budgeting, settle projects, and prepare reports, all with the aim of achieving a smooth handover. Much like everyone else, leaders endeavour to tie up loose ends swiftly, allowing for festive celebrations and future planning.
The Importance of Incorporating Past Events into an Effective Strategy
At the onset of a new year, numerous enterprises conduct strategic planning meetings for future endeavours. It is normal to leave the past behind, and based on my experience, several executives center their attention on forthcoming plans rather than introspecting on the previous year’s victories, shortcomings and ongoing ventures.
Initiating the strategic planning procedure with a detailed and meticulous assessment of the past is vital, either as an integral aspect of the strategy or as an exercise that sheds light on it.
The evaluation should comprise of the following three key components:
- Assessing the global market and external factors from the previous year is indispensable. Noteworthy transformations in technology, economic systems, and social trends should be scrutinised. Were these modifications gradual, such as the launch of a latest version of an existing technology, or unforeseen and severe, such as the consequences of the COVID-19 pandemic?
- Can you please present a summary of your strategic initiatives’ performance during the past year? Which ventures were prosperous, and which ones were not? During your evaluation, which factors did you recognise as impacting the outcomes the most? Were these factors from internal sources, such as budget, or external sources, such as the external environment?
- In your appraisal, did you detect any overall trends? Did you accomplish exceptional results in some ventures due to a pre-existing acquaintance or connection, for instance? Have you wholly committed to an approach that relied upon formerly unfamiliar market conditions? Were there any vital skills that you were deficient in, making certain projects challenging to execute?
Let’s delve into each of these factors more closely.
An Environmental Looking Back
The last couple of years have been a stark indication that strategies and long-term objectives must be flexible, as the COVID-19 pandemic geared sweeping changes to the way we work, the sites we operate in, and the dependability and structure of our supply chains. During our annual assessment, we must not only ponder past events but also scrutinize how our plan has endured in the presence of expected and unexpected alterations in our surroundings.
We can evaluate the success of your scheme more accurately by considering external and internal environmental factors. For instance, even if the technology is of high quality, or the execution team is proficient, launching novel technology to assist in-person live events in the beginning of 2023 would likely have resulted in failure.
It is simple to relate a plan’s deficiency of success to factors outside of our jurisdiction. Nevertheless, it is also crucial to be attentive to the internal aspects of the plan that may have contributed to its success, even in adverse conditions.
When contemplating the instance of a racing car driver achieving 95% of their best time, but during a rainy race with a novel tyre compound, it is crucial to contemplate the contextual basic information of the internal and external surroundings of previous years. This helps us to comprehend that the 5% deterioration in performance would have been ignored as being too great if this information had not been factored in.
Evaluating the Well-being of Your Investments
The majority of businesses have frameworks established to oversee the efficacy of their strategic portfolio; nevertheless, these frameworks frequently only embody financial and delivery time metrics. It is necessary to ruminate on whether precise classification of ventures is transpiring and whether there is a disposition for subpar performance within particular categories of initiatives.
Forming initiatives into groups based on organizational structure may be a functional approach from an administrative standpoint; however, this may possibly overlook other crucial differences. Categorizing cloud migration initiatives by business unit could conceal the reality that most of them are not accomplishing their goals.
The success of the portfolio can be reviewed from numerous viewpoints, such as business units, employed key technologies, and linked risk. It is crucial to pinpoint a categorization factor that underscores either areas of triumphant accomplishment that can be emulated in other portions of the portfolio or locations of defeat where joint strategies to mitigate the risk could be rewarding.
Attempt to Discern Similarities
After concluding the initial two phases, it is now time to commence examining the similarities. Even if the internal or external environment has shifted significantly, it is plausible that certain segments of the portfolio have executed effectively. Evaluating whether management approaches like Agile have fulfilled their commitments, or if any technology has been implemented to hasten delivery, will assist in shaping the subsequent actions to be taken.
Concentrating on a restricted number of pivotal concepts could provide immense advantages in developing your plan. These topics could aid in identifying any deficiencies or emerging trends that may have been overlooked earlier.
This retrospective is not intended to be utilised as a means of attributing fault and penalties, but rather as a tool for acquiring understanding and insight into what transpired well and what did not. By doing so, your organisation can be better equipped for upcoming endeavours. To guarantee sustained success, an annual review ought to be conducted to determine trends and patterns that can be employed to counsel and impact future strategies, similar to how an athlete reviews their own performance and training history.
