Author's Name: Mark Schultz
Date: Fri 13 Nov 2015

In strategic planning, does structure come first or last?

A key responsibility of the Board in our Governance Excellence model is the development of the strategic plan. Whilst organisations, existing ones at least, will always start with a structure and people in place, the focus in the initial stages should be on “what and how” and then on "by whom", not the other way round.

It is not unusual for a Board and its leadership group to start the planning process by looking at current resources, that is: people; positions; infrastructure; and assets in general. The next stage then generally involves trying to align that capacity and capability with what the organisation is trying to achieve. The major drawback from this approach is that the organisation is always trying to make “things fit“ and will usually have to compromise one or the other to make this strategy work. 

Under the Governance Excellence model, the Board undertakes its internal and external review, agrees on a specific strategic direction, articulates that direction through its mission and goals and then develops strategies to achieve goals. Once this has been completed, then the matter of structure (capacity & capability) is determined. If the Board commits to a certain direction and long term goals, then it must also commit and resource the structure to do what is required to be done to implement the plan. If those resources are not available or not able to be procured, then it is the responsibility of the Board to re assess its overall plan. 

In the first instance, it may appear that compromise may be required either way, however the best result is achieved when the “goals, strategy, structure” approach is applied in the strategic planning process. One looks at what the organisation has and what can be achieved with this, the other looks at what the organisation is trying to achieve and then what is needed to implement the plan - a subtle but important difference in governance and leadership.

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