I once read a survey that suggested that over half of all Chief Finance Officers would cut a project with a positive net present value in order to hit short-term profit targets. In other words, these CFOs would forsake future profits to meet immediate aims. There is, of course, a certain level of logic to this behaviour, but a persistently short-term focus is damaging to company performance. A recent study showed that the returns to shareholders of companies that delivered short-term and long-term results were nearly 50% greater than those solely focused on the short-term.

So, what can you do to manage the conflicts between your immediate issues and your longer-term goals? One tool that has proven popular with my clients is The Strategy Route-Map (see above). The Route Map acts as a bridge between your high-level strategy and goals and your operating plans and budgets. Here are the steps you should take to create a route map that will drive decisions and actions in line with your strategy:

  1. I am assuming that you have already set a clear strategic future (#1 Goal, Where You Play, How You Win), and have identified a small set of strategic objectives that you need to pursue to turn that future into reality. If you haven’t, you can learn more here https://morgancross.co.uk/strategy/the-strategy-arrow-creating-a-strategy-with-cut-through/.
  2. For each strategic objective identify the major achievements and milestones you need to accomplish over the next few years in order to hit your goal and deliver your strategy. Summarize these milestones, by year (or quarter, depending on timescales), on the chart.
  3. For your #1 goal and other key performance measures, establish top-down targets by year (or quarter etc.).
  4. Establish accountabilities for delivery for each of your objectives and critical milestones, naming a specific manager or executive to lead each one.
  5. Review the overall pace and scope of delivery and refine the initial view. Questions to ask include: Are you achieving your goals quickly enough? Have you identified and aligned specific linkages and dependencies between different objectives and milestones? Do you believe that you will have the capacity and resources to deliver the milestones and performance goals in line with your ambitions?
  6. Once you have agreed on your top-down route map, you can then align your bottom-up plans and actions to your top-down objectives and milestones. First, you can develop, where appropriate, specific programmes and plans to deliver the organizational changes you’re seeking. Also, you may discover that you’re running projects that fall outside your new strategic ambitions. If so, you should drop them from your agenda.
  7. You can then set up the governance for delivery – roles, meetings, decision-making etc. – using the route-map as a key tool for both monitoring progress and embedding accountability.

The benefits of this approach are threefold. First, you start with your strategy and major objectives and work back from there. You are not simply seeking to identify ways to improve performance; you are looking for actions that will enhance your results and deliver your strategic aims.

Second, it pushes the accountability for the more detailed planning of projects down to the front line. You can set the pace of delivery by articulating the milestones to be met and the organization’s overall performance standards, but your teams are better placed to determine what needs to be done to make these goals a reality.

Third, it helps you to focus on the journey as well as the destination. Many companies develop in-depth future strategic positions. It is less common for the equivalent effort to be put into finding the best route to delivering strategy. It is vital to spend time developing a suitable plan that delivers short-term performance as part of a longer-term growth campaign. Delivering short-term results is difficult for many companies, never mind spending time and effort to build longer-term growth. Yet successful companies find ways to focus on both dimensions. Following these practical, proven steps and building a Strategy Route-Map are ways in which they establish this dual focus.