Editor’s note: This is the third in an exclusive series by industry research specialist Fran Gretes.

 

Strategic plans do not need to be long documents weighted with statistics, but need to include enough information for you to be able to:

 

·        Analyze your business

·        Understand your market

·        Analyze your competition

·        Assess your skills and capabilities

 

You should consider these plans as “living” documents with achievable goals that you refer to on a regular basis and modify to fit changing circumstances.

 

A strategic plan establishes a firm’s goals, mission, and values as well as addresses its strengths and weaknesses, market position, and future threats and opportunities. Emanating from this plan are the business plan which outlines specific steps in developing the financial side of the firm, and the marketing plan which describes how to obtain new business, promote the firm’s image, and communicate the appropriate message in support of the firm’s overall strategy.

 

There are many excellent guides to preparing strategic plans, some of which are listed below. In The Architect’s Handbook of Professional Practice (14th edition), Jack Reigle, president of SPARKS: The Center for Strategic Planning, describes a framework for planning direction. He refers to five “catalytic decisions” that need to be made: 1) the Why defines the issues; 2) the Who determines what the firm represents; 3) the Where identifies the targets; 4) the How chooses the images; and 5) the What relates to the actions the firm chooses.

 

The importance of basing strategy on the right information cannot be stressed enough. Research gives structure to the strategic plan; improves future decision-making; and helps in crafting the appropriate message you will deliver to your target market. Poor, outdated information can throw your entire plan off track. I recommend a few research approaches for developing your plan.

 

Formulation of any well-developed strategy requires a thorough study of external and internal environments that look at markets, clients, people (i.e., employees or stakeholders), and technologies. To support these analyses you need a combination of qualitative (“soft”) and quantitative (“hard”) information from primary sources (first-hand sources like interviews) or secondary sources (such as news articles or published statistics from government or industry).

 

Qualitative data comprises subjective information such as public perceptions, employee opinions, and client feedback. This information is especially useful to collect at the beginning of your strategic research to help establish a hypothesis – what do you think is true? It is also a good indicator of future trends because this information is not static – it is what people hope or predict will become true. Depending on your budget, you can make your own inquiries to gather this data or hire a consultant to conduct surveys or focus groups.

 

When you have your hypothesis, you test it against quantitative data, facts on actions to which you can assign numerical values like staff size, salaries, market size and value, and profit. You should have a large enough sampling of this data to make comparisons by year, region, function, or market. You will need to collect internal data (hopefully you have kept accurate and complete records). Comparables of the external environment are available commercially through a variety of sources such as the AIA, PSMJ, Zweig-White, McGraw-Hill, the Greenway Group, and many more.

 

Strategic research evolves through three stages: Definition, Translation, and Measurement of information.

 

Define what you think the issues are (your hypotheses) and then collect data to prove or disprove that hypothesis. Example of a hypothesis: “We are best known for our museum designs; we like doing museums, and we win many awards in this category. Therefore, we should pursue more museums.” This may be true based on your beliefs, public perceptions, and past history, but current conditions may require different actions, and this sector may not be as profitable as you think.

 

Before you begin collecting data you need to ask some key questions which are common to all strategic searches:

 

a)                 What is the single overall issue facing the firm? (Profitability, reputation&hellip?)

b)         What are the specific questions that need to be answered in order to address this large strategic question?

c)                  Is there a current prevailing hypothesis about the answer to this large   question?

d)                 Would the firm be willing to change in response to the findings? How much?

 

The subsequent search will result in a synthesis of internal inventories, overviews of current markets, trends reports, forecasts, competitive data, and statistics illuminating the volume, value, and nature of opportunities or problems.

 

To help you determine what you are able to sustain, collect relevant data from within your firm such as staff turnover, profit/loss, and categories of projects won, etc. Also collect external data: current economic/political situations; the regulatory environment; industry forecasts; the competition’s share of the market; etc. Some examples of statistics that help define issues are: declining occupancy rates; school enrollment; housing sales; population changes; GDP; budgets; cost of construction materials; etc. Be careful about making too many assumptions and remember that you need both hard data and opinions.

 

After defining what you think are the issues, translate the data by aggregating it to identify common points, key influencers, possible outcomes, etc. Futurist Peter Schwartz recommends making a scenario grid listing your two most important uncertainties to form the axes of the grid. Measure the key forces against your firm’s capabilities, resources, and competition. Weight the issues, prioritize, and establish benchmarks and timelines.

 

To keep from drowning in an “information tsunami,” I also suggest these four actions: Explore – Associate – Question – Eliminate. These thought processes are familiar to architects because you use them in design. When you apply the same type of thinking to your research for strategic planning, you achieve excellent results.

 

Explore beyond architecture in order to see the larger picture. Associate ideas and connect dots in order to see them in a new context. Ask questions such as “why,” “what if,” “so what,” and “should we.” These questions will keep your information relevant, capture what is significant, and eliminate what is superfluous or incorrect. Eliminate inbred assumptions and biases and look for disconfirming evidence. By readjusting your filter you gain a flexible perspective which will be beneficial especially when building scenarios. By applying these actions you can protect yourself from being distracted by too much irrelevant information; you will recognize what is most important, and still be receptive to new ideas.

 

Some of the influences to study when assessing your firm’s position are:

 

·              The Economy: Examine forecasts, study changes in business, and ask: Are these changes temporary or long term? The entire landscape transforms dramatically during periods of excessive gains or losses – companies go out of business; new companies form; companies change strategies and service lines; consumers don’t behave the same in a recession as they do when they feel wealthier. You need to observe keenly as well as talk with experts and gain insight from think tanks.

·              Trends in Science and Technology: These are the most important drivers of future events. Once an innovation has been released, it cannot be withdrawn. When you read about a new technology or discovery, think about the implications: 1) What will be enhanced as a result? 2) What will be diminished? 3) What will be replaced?

·              Political Changes and Government Regulation: Changes in leadership and new laws can profoundly impact the marketplace, from housing design at the community level to transnational infrastructure projects at the global scale.

·              Social Changes And Public Perceptions: Surveys, advertising, and citizen activism indicate cultural changes. Ideas once considered “fringe,” such as global warming or nanotechnology, often go mainstream so you should be prepared.

·              Competition: Examine the strengths and weaknesses of your competitors. Which firms hold the largest share of the market? Do they have the capabilities and management structure to hold that place in the future? What does your firm need to do to take their place?

 

Tips in analyzing the market, studying the competition, and assessing skills

 

Step into the clients’ position and then look at the services you provide from their point of view. To do this constructively you need to thoroughly understand your current and potential clients individually – even if they share the same market or if you think you know them because you have worked with them for a long time. Be aware of their current desires, expectations, and new strategies. All businesses are transforming now. Your market is not what you thought you knew. To keep up with what is happening:

 

·                                Follow industry news and keep clippings on file.

·                                Talk to your clients, their clients, vendors and competitors.

·                                Follow press releases.

·                                For public companies, look at financial reporting such as SEC filings to check their financial vitality – and also to extract their strategies which are usually described in the management discussions of the 10Q and 10K.

·                                Study perceptions in the marketplace (newspapers, ads, general media).

 

Study your competition’s websites, marketing materials, articles in trade journals, rankings, and blog sites; attend events where they speak publicly; talk with their clients, consultants, and past employees. Create a chart compiling the comparative data in relation to your firm and also to what you have determined the clients need or market demands.

 

When assessing your firm’s skills and capabilities ask lots of questions. Keep an open mind and look at your firm in the larger context of your competitors and the profession, new technologies, and trends. Also read trade publications to determine if you are keeping up with the profession; review professional surveys that compare firm size, marketing ratios, retention rates, salaries; observe changes in professional development such as growth in new accreditations (i.e. LEED®, EDAC®); examine in-house capacities and tools and explore what experts or technologies are out there that might be more productive.

 

To understand your firm, you need to look at how others view you and how you rank within the profession. One way to do this is by conducting a search through NEXIS®, a subscription-based news retrieval service, over a span of time, looking at every mention of the firm and its key principals, and analyzing the context for clues to how your firm is perceived and where your image needs revising.

 

Forecasting

 

Forecasting, the process of making projections over a period of time on the basis of charted data, is essential to long-term planning. Both an art and a science, forecasting involves a great deal of risk and uncertainty and should be conducted by experts. Forecasts with high levels of statistical accuracy are published by the government, think tanks, universities and consultants. They can be obtained for free (but you risk getting projections based on older data) or at great cost. If you have a very small budget, you can combine free published forecasts with your own research using these tips:

 

·                    Read widely across various disciplines, particularly the science of human behavior and technologies which transform society.

·                    Confirm with the source that you are looking at the most current data.

·                    Look at familiar situations in unfamiliar ways including from perspectives of clients or employees.

·                    Spot new ideas in previously rejected ideas.

·                    Examine bits and pieces from a variety of sources (annual reports, services, events, brochures); look for themes, connect dots, and extract insight.

·                    Put aside judgment, pre-conceived notions, and fears and you will see the future more clearly.

 

Selected Sources on Strategic Planning:

 

Barksdale, Susan and Terry Lund. 10 Steps to Successful Strategic Planning. Alexandria, VA: American Society for Training and Development, 2006.

 

Bradford, Robert W. and J. Peter Duncan. Simplified Strategic Planning: The No-Nonsense Guide for Busy People Who Want Results Fast. Worcester, MA: Chandler House Press, 2000.

 

Bruce, Andy and Ken Langdon. Strategic Thinking: Plan the Future and Make it Happen. New York: Dorling Kindersley, 2007.

 

Charam, Ram. Know-How: The 8 Skills that Separate People Who Perform from Those Who Don’t. New York: Crown, 2007.

-- Particularly chapter 3, “Before the Point Tips”

 

PlanWare: free “Online Strategic Planner”

 

Kogan, Raymond, AIA and Cara Bobchek. Strategic Planning for Design Firms. New York: Kaplan, 2007.

 

Maxwell, John C. Thinking for a Change. New York: Center Street, 2005.

-- Particularly Skill 5: “Release the Power of Strategic Thinking”

 

Naisbitt, John. Mind Set! Eleven Ways to Change the Way You See – and Create – the Future. New York: Collins, 2008.

 

American Institute of Architects (AIA). The Architect’s Handbook of Professional Practice (14th edition). Hoboken, NJ: Wiley & Sons, 2008.

-- Particularly “Strategic Planning for the Design Firm” by Jack Reigle

 

Reigle, Jack. Silver Bullets: Strategic Intelligence for Better Design Firm Management. Minneapolis: Bascom Hill Publishing Group, 2008.

 

Schwartz, Peter. The Art of the Long View. New York: Doubleday, 1996.

 

“Preparation for Strategic Planning.” Free Management Library

 

“Strategic Planning: Building a Strong Foundation for Ownership Transition” by John Doehring. ZweigWhite, 2009.

 

“Strategic Planning: Three Tips for 2009.” Article by Renée Dye, Olivier Sibony, and S. Patrick Viguerie, McKinsey Quarterly, April 2009.

 

“The Strategic Planning Process.” netMBA/Internet Center for Management and Business Administration.

 

Fran Gretes is founder and principal of Gretes Research Services, a full-service consultancy that provides market and competitive intelligence and strategic thinking skills to professionals engaged in services for the built environment. You can reach her at info@gretesresearch.com.

 

See also:

 

Market Research Strategies in Uncertain Times 
#1 - Now More Than Ever: Why market research is so critical to a firm's success.

 

Market Research Strategies in Uncertain Times #2: Finding Leads
Finding leads that one can act on right away is a difficult task, especially during tough economic times, but these strategies can help.