Strategic Planning in times of COVID-19

pandemic, which the world is currently facing, has demonstrated to society that uncertainty and surprise are the new 'normal' that organisations must consider in their strategic design.

Developing strategic thinking, in the current circumstances, is directionally correct when going beyond the usual methodologies - based on the projection of the past - and developing a core competence that allows organisations to project themselves into the future and to take better advantage of adverse situations, more quickly than their competitors.

Strategic planning assumes, more than ever, a core role in organisations by structuring their ability to interpret emerging signals, promote the challenge to the prevailing orthodoxies and the deep beliefs in the levers of past success.

What to use to guide strategic thinking?

The three horizons model appears to be robust for structuring the strategic thinking of organisations and suitable for establishing action for the times ahead, to the exact extent that it provides the spaces for reflection leading to action that a manager needs to consider in his organisation's planning process.

Strategic Planning and COVID-19

The exceptional situation being experienced due to Covid-19 has forced organizations and governments to make decisions, some with very long term implications, without having the time or information required for a solid strategic foundation. The complexity of the problem and the high level of uncertainty, exacerbated by new and unpredictable conditions, hinders not only decision-making capacity but also sensemaking.

Faced with such a situation, managers are faced with two critical uncertainties:

And it is through these uncertainties, and the three management horizons (H1, H2 and H3 above), that the scenarios can be designed for which we should prepare the intervention of each one in society and in the organisations where we have responsibilities of strategic direction.

Facing these scenarios, organisations may develop different initiatives to manage the new "normal" and prepare themselves to mitigate the surprise and uncertainty of the future. But we know that there are no good or bad futures, what can be good or bad is what each one of us does in the face of what lies ahead!

Given that we have no data or facts about the future and that all our experience has been acquired in the past, we must have the humility to assume what we do not know and therefore also have the courage, when we still have time, to design a path that prepares us to make the most of it as the future presents itself.

Organisations are spaces for action and the challenge that any manager constantly faces is decision making with incomplete and asymmetric information, so when it is time to act, it is already too late to think!

With this in mind, we share a possible path of reflection that will certainly lead to a potential robust initiative plan for any of the scenarios we will face along the three action horizons:

1. Horizon 1, in the immediate: the most relevant word is protect:

1. The physical, mental and social health of ourselves and all those close to us (family and co-workers);
   
   
2. The liquidity of our organisations (e.g.: factoring / split invoicing / careful debt...);
   
   
3. Our brand's reputation for social awareness and shared value.

2. Horizon 1, in the short term: the most relevant word is resilience:

1. Create a crisis management organisational structure with elements of top management and employees from critical functions (finance, supply chain, production, human resources, IT and marketing and sales);
   
   
2. To assess key business risks, design organisation-specific scenarios (including financial stress-tests ), establish a roadmap of critical activities (e.g.: accelerate process digitisation and informational and transactional online presence) and create a set of early warning indicators to help implement critical activities at the right time.
   
   

3. Horizons 1 and 2 (next): the most relevant word is "restore":

1. Proximity to customers;
   
   
2. The proximity to suppliers and rethinking the supply chain (e.g.: nearshore vs offshore / diversify the supplier list...);
   
   
3. The guarantee that employees return to productive activities safely;
   
   
4. The evaluation of what was done in 1. and 2. as processes may have been implemented that should be continued.
   
   

4. Horizons 2 and 3: the most relevant expression is "back to the future":

1. How do we redesign internal processes to increase efficiency?
   
   
2. How will we further differentiate our products/services?
   
   
3. What organisational resources do we lack to ensure that we are not surprised again?
   
   
4. What investment opportunities will all this generate? Will the competitive landscape in our industry be different?
   
   
5. Will regulation of our industry change?
   
   
6. What technological roadmap do we need to develop?
   
   
7. There will be increased protectionism, resulting from significant changes in the free movement of people and goods
   
   
8. Will telework remain, resulting in a new labour regulation?
   
   
9. What will the new offline/online mix be?
   
   
10. …

The script proposed here is certainly not exhaustive, but it is demanding in two aspects: speed and discipline. The later and/or less disciplined the planning process starts in organisations, the more the navigation will be coastal! Now, what all the news, both general and specialised, show us daily, is that navigation will have to be oceanic, most probably through stormy seas and, in most cases, through seas never sailed before! In these circumstances, the time already spent drawing the compass that points the North is what will allow us to bend the cape of the storms that we are living together!

By the way, and by way of conclusion, don't wait for a Don Sebastian to appear one foggy morning to save us. Instead of waiting, don't forget that "caminante, el camino se hace andando"!