Business Planning Consulting

Strategic Planning Consulting   

A major financial services company found itself going through considerable pain every year in their process that came to be known as "fall planning". Each year nearly 500 people were involved throughout the 4th quarter to produce the company’s annual business plan. The effort lasted well into Q1, and the plan was not presented to the Board of Directors until March or April.

In several key stages, and over the course of two years the static annual process, was migrated to a quarterly, dynamic and highly successful process.

In this staged process, this firm improved both their process, and the quality of their plans as time passed. Initially, the company made several key improvements to the annual planning process, with a particular focus on the largest division:

• Hired a dedicated planning director to focus on planning in the largest division.
• Compressed the planning cycle to have the annual plan presented to the board by late December.
• Created forums for senior management team to separate and focus on strategic and operational issues, and improve ability to think strategically

With the quality of the plans dramatically improved, and the process at least benchmarking against its peer group, the company took two key steps at the corporate level:

• Conducted a comprehensive debrief of their annual planning process to identify gaps and initial areas for improvement
• Formed a senior team, with sponsorship and support from the CEO, with a mandate to create an enhanced, company wide, integrated business planning process

The project group moved quickly to make limited improvements to the plans and the process company-wide, and proposed several ideas:

• Move from an annual to a quarterly planning cycle with several clearly defined steps and clear accountabilities in each cycle
• Adopt the use of a planning continuum to provide line of sight from the corporate vision level to the functional area action plans
• Drastically reduce the amount of detail, and the number of people involved in the budgeting process
• Adopt a completely new target setting process that is not disconnected from the planning process, reduces politics, and promotes stretch targets

Strategically, the most important change was the adoption of the planning continuum, including the careful use of tightly defined strategic imperatives. Organizationally, the most profound change was the severe reduction of detailed budgets, which saw the number of line items of budget detail shrink from several hundred to about fifty, and the number of budget centers (and budget managers) shrink from over 300 to less than thirty.