In some cases, a straightforward approach to developing a business plan simply doesn’t work.
Sometimes, the same roadblocks encountered previously are repeated during the planning stage. Or, even worse, a plan is developed that due to different reasons – too ambitious a scope, a lack of consideration for available resources – ends with no implementation.
So, what to do? A smart move in these situations is to turn to reverse planning. It’s the idea of starting with the end result rather than mapping out a business’ mission statement and values and then going from there.
Once an end result is concrete, leaders can then “go backward” and find specific changes that need to be made to achieve that result.
It’s simple and effective. Unfortunately, many businesses don’t do it.
Future Back Planning
Consulting firm Innosight refers to this strategy as “future back” because it defines a future state and establishes the “near term priorities and milestones” necessary to reach that point.
Innosight compares a future-back approach to using your car’s GPS for a road trip. You start with your ultimate destination, then work backward to find the best roads to get there. You know exactly where you want to go, but you can start the journey there without knowing every detail of the path you take.
Such a process allows for businesses to create a vision for the future and carefully manage the enterprise to achieve that goal, rather than constantly react to ongoing events.
Psychology and Reverse Planning
Peking University HSBC Business School, Korea University Business School and University of Iowa researchers found that reverse strategic thinking works particularly well on long, complex plans, such as ones used for business strategy, according to a Psychological Science article.
The researchers noted that the study’s findings suggest simply changing how you approach planning can have a significant impact on the eventual outcome. For example, students who used reverse planning to study for a comprehensive test did better on the test and felt less stress as the plan unfolded.
Considerations for Reverse Planning
When using reverse planning, there are some key questions to keep in mind.
- What is the clear goal of this plan? What outcomes are expected by a certain time?
- Who will take responsibility for ultimately implementing the plan?
- What tactics are needed to successfully implement the plan, including employee skills, individual work plans, equipment, supplies and training?
- What formal process needs to be in place to ensure progress of the plan is monitored?
- What formal process needs to be in place to address issues that hinder implementation of the plan as they arise?
- Who will have responsibility to update the plan as changes are needed?
Innosight suggests that strategic plans cover at least five and as many as 10 years. This means collection of detailed data on the future needs of consumers and how best to position the company to meet them down the road.
Once that is clear, leaders can then “walk the future back” and set milestones to attain along the way, indicating progress in the right direction.