At its recent recycling meeting, the National Wooden Pallet and Container Association (NWPCA) released its new strategic plan. This plan focused on the continued development of the Pallet Design System™ (PDS) software and the association’s mission for its members. The association’s core purpose is to “provide an environment for its members to succeed while promoting the wooden pallet and wooden packaging industry.” The NWPCA’s plan focuses on four core values: wood as a sustainable and highly-valued resource; exemplary service to its members; high ethical standards and integrity; and building collaboration and community.
If you want to evaluate the NWPCA strategic plan visit www.palletcentral.com. The purpose of this letter is to use the NWPCA plan as a springboard for pallet and lumber companies to think about developing a plan of their own. Smart companies know that having a good plan and executing it are critical for success.
On the one hand I want to encourage readers to develop your own strategic plan if you have not already done so. But I also want to caution about how easy it is to develop a plan that does little more than waste lots of time.
Years ago, shortly after receiving my Ph.D., I taught in the Management Science and Accounting Department at Bowling Green State University. I remember when we made a valiant attempt to develop a Management by Objectives Program (MOP). We met as a department on a Friday afternoon at 3 p.m. and stayed at it for eight hours until 11 p.m. hashing out a detailed document to help us run a more efficient department. The process took close to 20 of us a full eight hours to develop this document. As I recall our MBO document disappeared into a filing cabinet in the departmental office, to my knowledge never to resurface. Good intentions can become just that – good intentions.
I believe that one of the shortcomings in our MBO plan was the lack of a follow through. Who is accountable for evaluating the plan and seeing that it is updated when needed? Every plan needs a champion who will lead the effort, and this should involve top leadership. Otherwise, the plan is likely to be ignored.
Business periodicals and the Web are full of good articles on how to write and implement a strategic plans. An article by Erica Olsen for the OnStrategy website explained well the three key questions that business planners must consider. These key questions are: 1) Where are we now?; 2) Where are we going?; and 3) How will we get there? While these questions may seem simple, they are full of difficult scenarios and action steps that must be carefully considered.
Review your strategic position regularly to update your mission statement or purpose for which you were founded to re-evaluate your values and guiding principles. Use the SWOT plan – strengths, weaknesses, opportunities, and threats. You need to build on your strengths, shore up your weaknesses, recognize the pitfalls, and capitalize on opportunities.
As I look back over the years at all of the pallet plants and sawmills I have visited and either written or read about, some of them definitely stand out from the crowd. Why? Probably not because they make better pallets. Probably not because the products they make stand out from the pack. The things that make them exceptional are often more difficult to pin down. You see it in their people, particularly those who hold management and ownership positions. You see it in their physical plants – things such as cleanliness and organization of the production process.
Determining where a company is right now can be more difficult than one might think. Seeing ourselves as we want to see ourselves instead of how others see us can lead us astray. Conducting internal and external audits can help you get a clear understanding of the marketplace, the competitive environment and your true strengths. After you identify what is important and your unique strategic advantage, you will be in a better position to set the goals and direction to make your company and its products stand out.
Defining as precisely as possible what you want to achieve will allow both you and your people to better understand how to separate yourself from your competitors. Specifying who is accountable for implementing a plan goes a long ways toward making a plan successful.
One has to avoid making planning steps that are too vague. Statements such as working smarter, not harder may sound good but they do not define specific actions you plan to take. They may be good in theory but they often fail to be good action steps. A good set of action steps helps each manager and each worker know what to do and when.
As Bill Conerly put it on Forbes.com, “I walked into my office this morning and my strategic plan dictated how I spent the morning. If your strategic plan fails to define what the management team does every day, then it needs good action steps.”
Some companies and their products by their nature make it easier to differentiate when compared to others. For example, a pallet company may find it to be difficult to stand out if you just look at the pallets it ships. By looking at its services and how much knowledge it has to share with its customers, a company can more easily distinguish itself.
It is always good to dream big, but it is equally important to be realistic. One of the biggest ways to make yourself indispensable is to supply knowledge and do it in a way that your customers will appreciate it. You can have the best service and capabilities around. But if others don’t realize that, you will struggle to be noticed in an increasingly crowded, frantic business environment.
While it is fairly easy to talk about planning, actually implementing a good plan requires dedication and understanding. If you haven’t developed a strategic plan, you might want to consider doing so in the future as you head into 2015. While there are a lot of pallet plants and sawmills that are just that – a pallet company or sawmill – to be successful in the future you are probably going to need a plan – A Good One!
