While endless meetings in drab conference rooms can quickly squelch the holiday spirit, the process actually has the potential to be energizing and liberating. Bringing key staff together to peer into the future and unite behind a plan can help teams rise above day-to-day differences and embrace a common purpose. This year, large companies have record levels of cash on hand (a 50-year high), so the challenge for many firms will be how to spend funds wisely given big uncertainties about the economy, rapid changes in many industries, and a frequently disappointing track record of embracing new forms of growth. This is possible.
Innovation is the obvious answer to worries about how to grow organically, yet strategic planning and innovation tend not to mix. Too often, strategic plans are really financial plans with a thin veneer of competitive analysis on top. Views of competitors are inherently backward-looking, and financial projections assume a degree of certainty which is unrealistic in the current economy. To avoid downside surprises and to convey the clarity that many expect of strategic plans, the process biases thinking toward small initiatves that risk little, but which also offer scant rewards.