An excellent strategic planning (PE) is fundamental for every company. But it has costs and therefore must leave the paper, be executed. Have you ever stopped to think about the cost of failing to execute business strategies?
About this we will reflect on this article. Continue Reading to understand how and why many companies throw money away for not putting into practice what they plan!
The cost of the lack of implementation of strategic planning
Many executives continue conducting strategic planning as something very abstract. And all that is not palpable tends to appear intangible or deceptively unonerous. But it’s not quite like that.
There are several costs involved in the processes of creating strategic plans, and they have seen expenses when they do not put into practice what was previously thought.
The following are some ways (which should be avoided) of wasting various resources with the lack of execution of strategic planning.
People’s time is wasted
A cost of lack of execution that is poorly visualized is the time that tactical and strategic people within the organization waste. They worked for hours to study and structure the EP — this time is “thrown out” when what is planned is not put into practice, and the time of these professionals could have been used for something that delivered real results.
To better understand this waste is interesting to think of the so-called productivity cost. That is, the sum of the expenses involved in the daily operational day of each employee.
Unanticipated projects are created
If you only plan and do not put into practice, you spend a good part of your money on projects that were not foreseen, and that possible and probably were not priority. When you realize you didn’t do what you were supposed to do (what you planned) you need to spend again.
In other words, by forgetting the action plans outlined during planning, it is normal for the priorities to be shuffled and unforeseen emergencies arise. And, we know, they cost more money, demand more time and energy from the team.
There’s a waste of time and money wiping out “fires”
By leaving the execution of the strategic planning aside and following the operation control in a disorderly manner, you do not evaluate risks and do not analyze root cause of the problems.
And that leads to what many executives complain about their routines: you spend a lot of time deleting “fires”, solving problems instead of concentrating energies on intelligent decision-making and analysis. The cost of the lack of execution, in this case, occurs in “remedy” rather than “prevent”.
? READ ALSO: 5 reasons why your company lives on “extinguishing fires”!
Quality Falls and customer satisfaction Also
Another cost that usually hurts the financial health and the image of the company is related to the decline in quality. By not executing the plan and acting without strategy, the products and services can have their quality reduced gradually, which makes the customer satisfaction also fall.
And this is because its culture of not executing action plans, allied to recurring problems, directly or indirectly affects the quality of its service.
The growth of the business is short of the expected
Everything that has been said so far entails the non-growth of the business, or the growth below the expected. And that’s because if you only erase fires, you only solve problems and don’t create solutions and opportunities — and then you get the feeling that you’re always running behind the machine.
In addition, there is no greater frustration than, finished the period, you look at what is demarcated in strategic planning, in terms of results, and realize that no goal has been achieved.
It is not possible to measure results
Finally, and no less important, the lack of execution intakes in the impossibility of measuring results.
Of course, if you don’t run action plans, you can’t keep track of metrics and indicators that you’ve plotted. Therefore, it is also very difficult to ascertain whether the predicted results have been achieved.
In summary, it costs the financial health of your business, the productivity of your team, the satisfaction of your customer and the growth of your company; are very high costs that result from the non-execution of strategic planning. You need to remember them not to swallow the EP and only remember it at the end of next year.