Shrader on the Who and When of Strategic Planning
Booz Allen Chairman stresses its importance to long-term success at WEF Panel in Davos, Switzerland.
"Strategic planning is essential to long-term success and the nature of it is changing," said Ralph Shrader, Chairman and CEO of Booz Allen Hamilton, in response to the main premise of a panel at the World Economic Forum Annual Meeting entitled "Who Has Time for Strategy Anyway?" The panel took place in Davos, Switzerland, on January 27, 2006.
photo courtesy of The World Economic Forum
Shrader stressed the importance of involving a wide range of constituencies within an organization at the beginning of the strategy process to collect input, but said that final decisions should be made by a small, more focused decision-making body at the top of the organization.
"Over and over again, we at Booz Allen find that clients let their executive councils or top management teams get too big—positive reasons are driving this to some extent, to cover geography, business segment, diversity—but the downside of too many decision-makers and too much compromise is worse," he said.
"I think that many should have a voice," Shrader told the audience of nearly 250 Annual Meeting attendees that filled the room in which the panel took place. "It's important to find ways to stay in touch with shareholders, senior managers, and rank-and-file employees and get their input."
"However, a small executive committee should have the votes and courage—after all, the buck stops there—to make hard choices on behalf of the organization."
When Should Strategies Be Changed?
Shrader said there was no clear-cut answer when a firm should change strategies. "There's great turmoil in the competitive landscape today and senior leaders must avoid being blindsided and should proactively exploit opportunities," he explained. "So leaders need sensing mechanisms to look for potential blindsiding threats as well as game-changing opportunities, and change their strategy to the extent necessary."
He added that strategy and execution need be done simultaneously today, not sequentially as in the past, and that the whole strategy exercise needs strong leadership in order to make it happen. "There are too few leaders who really can drive change and results," said Shrader. "We usually see and have more money to invest, than truly effective leaders to drive execution."
The panel was moderated by Thomas A. Stewart, Editor-in-Chief, Harvard Business Review. Other panel members included Gary Hamel, Visiting Professor, London Business School; Henning Kagermann, Chairman and CEO, SAP; and, Azim H. Premji, Chairman of Wipro.
story posted February 6, 2006
