BIRMINGHAM, Ala.-Planning for 2014? Successful strategic planning is an ongoing process as opposed to an annual event, advises Dennis Dollar.
The Dollar Associates' principal partner cautions that too many credit unions hold a single planning session at a retreat once a year and then get back together in 12 months to evaluate how they performed against the plan. "This turns strategic planning into a series of annual events, which is far less productive."
Instead, the most successful CUs have an ongoing planning process, noted the former NCUA chairman. "Here, management meets in advance of the planning session and prepares a series of well-documented goals for the board to consider, and then the board at the planning meeting either buys in or revises the goals."
Management then comes back 90 days later and hands the board a tactical plan addressing how the credit union will implement the strategic goals, continued Dollar. "The tactical plan is not presented to the board for approval because the board's job is to set strategy and management's job is to develop the tactics."
Planning does not work well when the board gets involved with determining tactics, as that removes management's ability to make tactical course corrections, as needed, during the year, added Dollar. "Management has no flexibility because the path has already been prescribed."
The board then schedules quarterly, sometimes monthly, progress updates from management. Due to the regular updates, next year's strategic planning session becomes a more high-level review of how the credit union has delivered on the plan during the entire year. "That leads to the strategic planning session becoming more about tweaking, adding to and deleting what has already been set, as opposed to starting from scratch and rehashing the same old ground."
A Big Error
A big error, according to Dollar, is too many strategic goals, as that turns the objectives into tactics. "You need to have more than five goals but no more than ten," he said.
Dollar acknowledged that larger CUs have greater capacity to do the legwork for ongoing strategic planning, but added that small credit unions can likely find the time. "The number of hours credit union management spends preparing for a weekend retreat are often concentrated into a month or six weeks before the event. Those hours are better spread out over the year to turn strategic planning into a true process."
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