The basic questions.
Most of the mistakes meeting designers make at this point stem from a faulty assumption: If you schedule a meeting, invite top leaders, and perhaps add an outside expert, a strategy offsite will produce a set of strategic priorities. In fact, that’s backwards. You must first understand where you are in the strategy process and determine what outcomes you want from the meeting.
Does the group need to hold an expansive conversation about broad strategic options, or is it time to make some concrete decisions? What time frame applies to the issues that will be discussed: Three to five years? Five to ten? The answers to such questions will determine the objectives, which will in turn determine the agenda and the participant list.
A strategic offsite’s success is largely determined by what happens before it convenes.
Many offsites derail because the meeting designer lacked the discipline to restrict the scope and number of issues to be considered. At the conclusion of the offsite, the company ends up with a laundry list of a dozen or more next steps but not a coherent strategic course of action. That’s why before the meeting, you should make it clear that the team will restrict the scope of the conversation, with the aim of producing a manageable number of key initiatives—typically four to ten. As we often remind clients, in many cases strategy is more a matter of defining what you aren’t going to do than deciding what you are going to do.
When the property and casualty unit of Allstate Insurance was planning its annual strategy offsite three years ago, executives made a conscious choice about what to focus their energies on. They knew that customer acquisition was important, but after reviewing Allstate’s growth rates and finding that customer loyalty was below the industry average, they decided that retention was the more critical concern. So we helped them design the offsite with the objective of developing a focused set of cross-functional initiatives to improve customer loyalty, postponing questions of attracting new customers.
Another mistake companies frequently make is to invite too many participants. One executive brings her entourage; another, concerned about being put on the spot, brings subordinates he can call on to bolster his position with supporting facts or a business case; observers from various departments attend. In the end, the offsite becomes little more than a town meeting, not a carefully designed strategy conversation.
The number and identity of invitees should be based on the scope and objectives of the meeting. An expansive conversation about broad options benefits from a large group of participants. Decisions are best made by smaller teams. In either case, start by inviting a management team that is accustomed to meeting regularly—the C-level executives, for example, or, if the meeting is a business unit session, the unit head and direct reports—rather than cobbling together a unique roster. And when you think about adding outside experts to the mix, make sure their expertise relates to your meeting’s objectives. Inviting an expert just because she is an expert takes the team nowhere—except perhaps for a ride on her hobbyhorse. If you bring in a marketing guru, for instance, you’re going to be looking at your corporate issues through a marketing lens.
The company’s strategy development process should never be turned over to an outsider to be distilled down to a set of multiple-choice options. The management team has to first figure out which issues are most important. Only then should it reach out to experts who can clarify those issues. Hiring a consultant to develop the strategy undermines internal commitment because executives justifiably feel detached. Not until they’ve put sweat equity into creating a strategy themselves will they feel they truly own it.
If most companies have too many participants, they have too few offsite sessions—usually restricting the meeting to an affair lasting two to three consecutive days. It’s far more effective to break the offsite into an initial two-day meeting and a one-day follow-up session a month later or a series of subsequent half- or full-day meetings each quarter. Why? Because executive teams are actually legislatures. There is, in effect, the congressman from Sales, the senator from Finance, and the ambassador from Operations. Each represents powerful constituencies in the body politic of the organization. Breaking up the meeting gives team members time to take the results of the initial session back to their constituents. The head of manufacturing, for example, is unlikely to sign on to a plan that may ultimately reduce the number of plants—no matter how compelling the strategic case—until he has had an opportunity to prepare the way with his team.
Executive teams are actually legislatures. There is, in effect, the congressman from Sales, the senator from Finance, and the ambassador from Operations.
Structuring the offsite as multiple sessions also allows participants time to gather data and explore unforeseen issues that have arisen. Instead of giving off-the-cuff answers to difficult questions, team members can bring the fruits of their considered thinking to subsequent meetings. And when you hold more than one session, you can vary the size of the group to best fit the goals. In the first meeting, for instance, a small leadership group might set priorities that are then rolled out to a larger group charged with creating implementation options. Or a larger group might “blue sky” at the first meeting, while a smaller group narrows the options later.
The relevant data.
Many companies circulate voluminous business plans before the offsite even though no one can reasonably be expected to absorb a half-dozen or more such documents, large parts of which aren’t relevant to the meeting’s objectives anyway. We’ve seen other firms pile on a huge number of articles, industry reports, consultants’ studies, books, or everything the vice president for strategy has collected in a reading folder during the year. Instead of overloading people (and practically guaranteeing they won’t finish the assigned reading), companies would do well to create a fact book—a compilation of data about the company and its external environment—which provides a common foundation for the conversation.
Additional reading should be chosen selectively: a single book or a few chapters or articles that are relevant to the objectives. A company holding a meeting focused on growth might, for example, circulate “Six Keys to Creating New-Growth Businesses,” by Clayton M. Christensen, Michael E. Raynor, and Scott D. Anthony from Harvard Management Update; the first chapter of Michael Treacy’s Double-Digit Growth: How Great Companies Achieve It—No Matter What, which assesses the importance of growth on a macro level and introduces the author’s “five growth disciplines”; the article “Beyond the Business Unit” from McKinsey Quarterly, which addresses the challenges of developing growth opportunities across business units; and a section on portfolio strategy from Perspectives on Corporate Strategy from The Boston Consulting Group, edited by Carl W. Stern and George Stalk, Jr.
A focused assignment forces participants to think in new ways about relevant issues and gives the team a frame of reference for the conversation. “In the midst of a passionate discussion, we were able to be brutally honest but nonconfrontational by referencing something from the reading,” says Duffy Smith, senior vice president for Rich Products, a food company based in Buffalo, New York. “When you’re dealing with strategy conceptually rather than in detail, it’s hard to bang in the pitons and move upward. But when you can cite, say, the cash cycle at Dell from the reading, you can really start thinking about how to get there.”
When distributing the data and background information, make it clear to participants that they are expected to absorb it before the offsite. The meeting is not the place to plod through data; in fact, Allstate has a rule against walking participants through material at the meetings that should have been circulated beforehand. “If we’re going to be together, we’re going to be problem solving or making decisions, not having ten people going through decks of PowerPoint slides,” says Tom Wilson, the company’s president and COO.
The way opinions are presented in an offsite needs to be even more carefully considered. Although necessary and desirable, opinions can easily degenerate into the anecdotal and impressionistic. A kind of equality must prevail among the participants in a genuinely healthy strategy conversation, but there’s no point in denying that some people’s opinions are more equal than others. That’s why it can be helpful to quantify participants’ views, gathered through interviews or surveys, before the meeting. Using that anonymous data as a starting point for strategy conversations can reveal and resolve critical issues dispassionately.
For example, when we worked with Experian Information Solutions, we conducted individual interviews with executives before the offsite. We placed 12 index cards on every person’s desk. Each bore a single word or phrase, such as “culture,” “knowledge of the customer,” or “speed to market.” In an effort to uncover companywide concerns, no names of specific functional areas were included on any of the cards. The executives selected and ranked three cards naming the issues they thought would have the greatest positive impact on the firm if addressed in the ensuing 36 months. After asking the executives about the reasons for their choices, we synthesized representative, anonymous comments and also graphed a tally of the number of times each card was selected.
The card sort exercise reveals what’s truly important to each individual. It also builds a better understanding of nomenclature. “Speed to market,” for example, might be defined differently by different executives—an important discovery in itself. Uncovering such divergences in perceptions is the first step toward alignment.
When using this technique, the meeting designer should share the quantified opinion data with the meeting owner so that she can use the information to guide conversations toward points of convergence and dispute and force out the underlying causes of disagreement. These data are best withheld from other participants until the meeting itself, when the public disclosure of the quantified points of contention can be used to really galvanize the discussion. If the leader wishes to share the results with everyone beforehand, it’s a good idea to wait until close to the meeting date to do so. Otherwise, people who feel threatened may use the time to prepare elaborate rationalizations that will forestall candid conversation.
The right structure.
Once the meeting designer understands the participants’ perspectives on strategic issues facing the company, some of the most interesting planning begins: selecting the tools that will ultimately help the team identify the right strategic initiatives and devising a structured agenda for the meeting itself.
As with outside experts, the objectives should guide the choice of strategy frameworks, not the other way around. Strategy frameworks are plentiful: SWOT analysis, McKinsey’s 7-S model, the Boston Consulting Group’s growth-share matrix, Porter’s five-forces model, and Kaplan and Norton’s balanced scorecard, to name only a few. Like the “You Are Here” map in a mall, a framework tells you precisely where you are in a strategy conversation and supplies a ready answer to that frequently asked question: “Where are we going with this?” Frameworks also help organize potentially limitless discussions about big issues like growth or innovation into manageable categories and focus the conversation on the objectives.
Like the “You Are Here” map in a mall, a framework supplies a ready answer to that frequently asked question: “Where are we going with this?”
Tools and frameworks help structure the discussion of particular issues, but they are not the meeting structure itself. That is the final step in premeeting preparation: to translate the meeting’s objectives into a structure and preview the objectives and agenda with participants.