Strategic Planning

Community Bank Strategic Planning Simplified

9 Questions You Must Ask About Your Strategic Planning Process…

And the One That Will Separate You From Banks Destined to Struggle Next Year

If I could show you how to re-capture the 37 percent of your total profits that’s being casually left on the table right now, would you want me to?

A Mondaq research study discovered that most companies only realize about 63 percent of their business strategy’s financial value (i.e. profit). The other 37 percent is out there waiting for you, if you know how to get it.

At the same time, we know only 15 percent of strategic plans have an execution process that regularly and consistently compares business results with their plan. And of those 15 percent, only a few matched the performance of the business results that were projected.

Imagine a strategic planning process that allows for the right strategies proven to lower risk, improve profit, and build a sustainable system that creates predictable organic growth that actually was implemented and exceeded.

You don’t have to imagine.

That system exists, and it works. It’s used by the highest-performing banks in the country—the ones with ROAs over 2 and net interest margins over 5.

Of course, while other bank executives are busy talking about margin compression as a reality in the “threat” section of their SWOT analysis, you need to create strategies to make sure it never becomes your reality.

Here’s the problem…

Almost every bank is dead wrong with their strategic planning approach. While they continue with the barely-breathing strategic planning model of “mission, values, SWOT, and goals”—the model in the 1970s—savvy banks are utilizing a highly-effective, accountable think-tank strategic planning process. It’s like the difference between going to war with a flimsy stick or a stealth bomber.

Is everything in your plan focused on the proven, most profitable next customers?

Why would you ever want more customers who don’t make money for you? You wouldn’t. So why are most strategic plans all about MORE customers…not the right ones? Without properly identifying those right customers and getting laser-like in your focus to build a plan around them, your entire plan is on a crumbling foundation.

Is your plan based on proven strategies that work today?

Well over 90% percent of banks that have strategic plans have a bunch of “best guesses” at the core of their plan. You can run your bank gracefully or painfully—and the difference is in spending the time up front to get the right strategies.

Do your values sound like they belong to 90 percent of other companies?

The news gets worse. Most “values” in strategic plans are not unique to that organization, so they are worthless in terms of decision making, attracting the right people, and knowing who to “invite off the bus.”

Take a look at your own plan. Do you say things like “integrity,” “accountability,” and “excellence?”

Yep, that’s what I’m talking about. Those words mean nothing if there is not uniqueness to your values and a platform to make them real and lived every day.

If values are your “true north” but you don’t define them well, let’s just say your chance of going beyond mediocre performance is slim to none.

Do you make sure that intended results and key initiatives are both included in the plan?

Are your critical numbers the driving numbers that will assure you that growth, profitability, and safety are always advancing?

Do you have alignment so that all of the 15 key components of the plan tie together—and all tie to the few but highly specific target niche markets of the most desirable next accounts?

Do you have strategies in your strategic plan? (Don’t laugh—most banks don’t.)

This is when a kick in the butt comes in handy. Brace yourself, because there’s a reality that you are not going to believe.

Most banks don’t have even one strategy in their strategic plan. In fact, most people who do strategic planning for a living don’t even understand strategies. If they did, there would be strategies in banks’ strategic plans. The plans are nothing more than a list of goals. You may as well call them pipe dreams, because without effective strategies, they are worthless.

Do you deploy strategy circles to make sure you’ve anticipated every stall and have plans in place to overcome stalls that could otherwise derail the implementation of a given strategy?

Most important of all is the question that separates the winners from the rest:

Do you have an iron-clad process of implementation?

That’s right—you need a process that has executives reporting into your plan weekly, all employees knowing their key results and key responsibilities, complete transparency of reporting, a method to deal with any area at risk in the first week it is at risk, and on and on and on.

The implementation process is where the rubber meets the road to make sure your plan isn’t just lip service.

Answer these questions to make sure your strategic planning process has the right strategies and that they get implemented—that they actually HAPPEN—to create breakthrough performance.

How to Predict If Your 2022 Strategic Plan Will Succeed or FAIL

Free, On-Demand Audio Training From Roxanne Emmerich Reveals the Strategic Planning Secrets of the Most Successful Community Banks in America

Roxanne Emmerich