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What Makes for a Successful Strategic Plan Update?

We recently received the following question from an attendee during our ACHE Cluster session, Strategic Planning from Formulation to Action, in Marco Island:

What makes for a successful strategic plan update?

Once a strategic plan has been completed, it needs to be updated on a consistent (at least annual) basis. This allows for the plan to adapt as the environment and organization change. This process is less intensive than the original strategic planning process, but it follows the same basic steps. A preplanning stage is preferable, as is an indication to the organization that the strategic plan is going through an annual update. This will alert the organization and help structure the process that is about to follow. Some organizations find the most effective update process takes place largely during a planning retreat. Often, unlike the traditional strategic planning process, the ratification of the strategic plan update falls to management unless significant issues are found during the update process.

Four questions need to be answered before the update can begin:

  • What are the desired outcomes of this strategic plan update process?
  • What are the key elements of the proposed process and schedule?
  • What will be the roles and responsibilities of leaders and groups?
  • How will the update be led and organized?

When following HS&S’s strategic planning process, there are four major parts of a strategic plan. The update should include:

Environmental Assessment: This will again be a less intensive process than what was used in the original strategic plan, but it is designed to identify major changes in the environment that may affect initiatives and goals that were created in the strategic plan. The environmental assessment will be updated very selectively, only in areas of major change. It should be noted that an update alone is not often effective if the environment has undergone major changes. Once the environment has been assessed, three main outputs should be identified

  • Confirmation of or a revised set of competitive advantages and disadvantages
  • Confirmation of or a revised set of assumptions about the future
  • Confirmation of or a revised set of critical planning issues

Organizational Direction:  This will likely require minimal attention during the update unless there has been a major new development (e.g., a merger, major acquisition). The nature of the mission and values statements makes them far reaching and timeless and should not be affected, barring major organizational change like a merger, by one year.

Strategy Formulation:  This process should focus on the goals, initiatives, and objectives from the existing strategic plan. The organization should examine the progress – successes, failures, and roadblocks – of each. Those objectives that had one year timelines will have either been achieved, need updates, or need reevaluation. Strategies should be revised to account for the current plan’s progress and new goals and objectives should be developed for new issues that have been uncovered during the update process.

Implementation Planning:  Similar to Strategy Formulation, this process can be a continuation of the original strategic plan if no new critical issues have been identified. Again, the action plans should be revised to account for progress, failures, and major barriers. Because the action plans that were developed in the original strategic planning process likely had a one-year time horizon, new action plans will likely need to be developed. First, identify which action items have been completed.  For action items that have not been completed, determine if those items are still necessary and include them in the updated action plan, as appropriate.

Does your organization update its strategic plan annually?  If so, what type of process is used?