Your Strategic Plan is Already Failing (And It's Not What You Think)

Ever wonder why 67% of strategic plans fail? Here's the uncomfortable truth: your brain is working against you before you even enter the planning room.

I discovered this the hard way watching Elena, a brilliant CEO, lead her annual strategic planning session. The usual suspects were there: market analysis, SWOT matrices, projection charts. Her team spent three days crafting what looked like the perfect plan.

Six month later, barely 20% of their initiatives were on track.

"I'm so frustrated! We had the data. We had the collaboration and team support. We have the resources to make it happen. What's going on?"

The answer lies not in the plan, but in how our brains approach planning itself.

Let me show you what I mean.

The planning fallacy, first described by Daniel Kahneman and Amos Tversky (1977) suggests that we underestimate the amount of resources required to complete a task - or goal. It shows up in simple things like our estimate for completing a simple task (this newsletter for example) as well as larger projects and strategic plans. This occurs even when we have data and past experience to show us the reality.

This is especially true when it comes to estimating our personal behaviors. We tend to think we are more capable, can do things faster, and have better outcomes than even past experience has shown us.

But this isn't the only issue with strategic planning.

Consider Marcus. As a team leader, his team was consistently missing signs of marketing shifts. The cost? $14 million in investment capacity they never needed. Their "optimism bias", behaving as though plans will work according to best-case scenarios, cost them.

The fascinating thing is these are not just random planning mistakes. They are predictable patterns in our behavior. Once you understand them, you can design planning processes that work with these tendencies rather than ignore them.

Here's what to do about these behavior patterns to ensure they don't work against reaching your strategic planning goals.

1. When completing your strategic plan, map out every task that must be completed to accomplish the goal. Estimate the time it will take to complete each plan. If the task is routine, multiple your estimate by 1.5. If it is a new task, multiply your estimate by 2 or 3.
2. Plan for problems. Answer the question, "what could go wrong?" and build plans for all the obstacles that might come your way. Increase the time to completion by 2.5 for any obstacle that creates a new plan.
3. Collect and review data. All strategic plans should be based on data. Goals and estimates about goal completion are best completed when data on previous behaviors supports it. If you don't have data yet, start collecting it today.
4. Monitor and identify patterns. One way to overcome planning fallacy and optimism bias is to collect data on project start dates, end dates, and the amount of work hours it took to complete it.
5. Create feedback and accountability loops: Create systems that allow you to easily monitor progress. Provide visual displays of that progress to your team along with positive feedback for meeting goals and corrective when the team is not on track.

Here's one way Elena's next planning session transformed their goals. She started the meeting by having her team list everything that went wrong in the past year. They then built a plan, analyzing the problems they incurred. The result? They are on track to meet 85% of their initiatives by the end of the year.

The science of behavior taught me what is necessary to overcome these challenges, but my real learning occurred in the trenches, watching brilliant leaders make predictable planning mistakes over and over again. Now I start every strategic planning session by addressing the behavioral tendencies to underestimate the work and overestimate the outcome.

Remember: There are assumptions hidden in every strategic plan. The goal is to identify those assumptions and address them before the plan is finalized. What assumptions are hiding in your plans?