Create new annual plan

This article is an extra to the book 'OGSM in practice'. We will discuss the process of creating new annual plans based on last year's plan. There was no space in the book to discuss this in more detail. In this article we assume that you make regular adjustments (every quarter). The OGSM is therefore always up to date. Nevertheless, it is wise to consider the OGSM a little longer each year and to evaluate whether the strategies are still correct. In this article we describe the steps.

OGSM in response to strategic challenges

Creating an OGSM starts with preparation

In the book 'OGSM in practice' we describe in chapter 3 the steps to arrive at an OGSM. There are different routes through the OGSM model, but the step-by-step plan always starts at step 0: the preparation (step 0).

One of the questions you answer in the preparation: What are the challenges that our plan must answer? These are the points that you have to overcome during the term of the plan.

Challenges always have to do with the environment (external) or with the team or organization (internal):

  • Opportunities. The opportunities created by developments in the environment. How can you grab these?
  • Threats. The threats that arise from developments in the environment. How can you avert these?
  • Forces. The strengths of the organization and the team. How can you use or expand these optimally?
  • Vulnerabilities. The vulnerabilities of the organization and the team. How can you reduce these?

Challenges are formulated as questions. Start with “How can we…” or “How can I…”.

From challenges to strategies

In step 0 you come to a selection of the five most important challenges. Later in the process, think about how to respond to the challenges and select the best ideas. This is how you arrive at strategies.

Doing, learning and adjusting the OGSM

The book also describes a method to regularly discuss the progress and results of your OGSM. This way you learn from your experiences and you can make adjustments if necessary. Every month you discuss the progress of the actions in a short session. This doing session revolves around the question: Are we doing things right? You discuss the progress of the strategies every quarter. The central question in this adjustment session is: Are we doing the right things?

Annual review of the challenges and objective

The OGSM is thus a living plan that is always current and relevant. In this way, the OGSM is and will always be the plan that you aim for as a team. Nevertheless, it is still wise to take a little more distance every (six) year. You not only look at the progress of actions and strategies, but you also update the principles of your OGSM. Are you still facing the same challenges or are there new strengths, vulnerabilities, opportunities or threats that you need to respond to? You update the OGSM based on the new insights. The following applies here: only if necessary. This is especially relevant for OGSMs higher up in the organization. For support teams, such an evaluation will be less important.

You can even ask the question: is our objective still what we strive for? Or should we tighten it up?

You can go through the following steps for the annual evaluation.

Step 1: Ambition and goals

Take a critical look at the formulated objective and goals. Are they still the destination of the plan? Do not lightly change the objective and goals. After all, you have formulated them carefully, in fact they are unshakable. But if circumstances or new insights necessitate changes, then that option must be available.

Step 2: Challenges

Get the list of challenges. You made this when drawing up the OGSM. And, if you have one, also the list of opportunities, threats, strengths and vulnerabilities. Did you not formulate any challenges at the time? Then do that now. See Chapter 3 in the book for the steps (or this article for the summary).

Opportunities and threats

Opportunities and threats arise from developments in the environment. Are there new or changed developments?

You gain insight into general developments with the PESTED model. In this way you look at Political, Economic, Social, Technological, Ecological and Demographic developments in a structured way.

Industry-specific developments can be found with Porter's 5-forces model. You investigate developments in the competition, the possible arrival of new entrants, suppliers, customers and possible substitutes.

Note: it is usually not necessary to do a full external analysis. This mainly concerns changes in the environment since the drafting of your OGSM.

Strengths and Vulnerabilities

Strengths and vulnerabilities arise from the organization and the team. Are there any new or changed points?

You can use the business model canvas to gain insight into the strength and vulnerability of the organization. This canvas consists of nine building blocks that together describe how your organization (profit or non-profit) works. These nine building blocks are: the value proposition, the customer segments, the customer relationships, the channels, the revenues, the core activities, the people / resources, the strategic partners and the costs. For each part you can indicate where your strength lies and where you are vulnerable.

The 7S model is also helpful in formulating strengths and vulnerabilities. In this way you research the topics strategy, structure, systems, personnel, core skills, leadership style and organizational culture in a structured way. Also look at the relationship between these elements.

Again, a full internal analysis is not necessary. Be sure to look at the changes.

Challenges

Now look closely at the list of challenges and compare the changed opportunities, threats, strengths and vulnerabilities.

  • Which challenges are no longer relevant?
  • Which challenges need to be tightened up?
  • What new challenges are there?

Step 3: Strategic choices

The strategies form the route to realize the objective (and therefore also the goals). They are also the answer to the challenges:

  • How can we realize the objective?
  • Challenge 1: How can we…?
  • Challenge 2: How can we…?
  • And so on.

Always determine whether the strategies in the OGSM are still the right answer for the objective and the challenges.

  • Which strategies need to be tightened up? Make a better wording.
  • Are new strategies necessary? Add it to the OGSM.
  • Are there strategies that are no longer relevant? Delete it from the OGSM.

Step 4: Indicators and Actions

Determine for each strategy (even if these have not been changed) whether the indicators and actions are still correct. Which indicators and actions should remain in place? Which are no longer relevant? Which ones should be added? Process the changes in the OGSM.

Step 5: Ensuring coherence between multiple OGSMs

Ensuring coherence in this step is no different from the step you take when creating new OGSMs. For the sake of completeness, we take the text from the book (chapter 6).

Organize a session in which the different teams present their plans to each other. It concerns teams that operate at the same level in the organizational structure, so for example all departments that an MT member leads or all teams within a department. In most cases you will organize the session with a delegation from the teams to keep the group size manageable.

Inventory interface and overlap

In the session you identify the points on which coherence needs to be improved. Check whether there are sufficient interfaces between the OGSMs: do they fit together well (both in terms of content and planning) or are there blank spots that still need to be filled in? And also pay attention to the overlap: is there duplication of work in the OGSMs?

You also look at the vertical coherence: is there a consistent translation within all plans of the same level? If there are differences, where do they come from?
You can make an inventory of all these points very practically by printing the OGSMs on A0 format. Have all participants write their feedback on the OGSMs. Discuss the most important feedback with each other and make a list of all the points where coherence needs to be improved. It usually goes too far to immediately resolve these points in the session. Therefore, write down an owner for each point. He is responsible for adjusting the OGSMs in consultation with colleagues.

To process feedback

The previous steps lead to new insights for the prepared OGSMs. Incorporate this feedback into the plans. Also keep in mind here: you can continue to improve OGSMs indefinitely. Good is good enough! The further fine-tuning of the plans is secured in the process of doing, learning and adjusting.

OGSM in practice

This article is a summary of a chapter of the book 'OGSM in practice'. More information can be found at ogsmindepraktijk.nl

Or order the book directly from management book of bol.com.

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