Strategic planning has always accounted for changing circumstances. But leaders have now shifted their planning habits to allow for on-the-fly adjustments.
For example, Office Depot began updating its annual budget monthly at the start of 2009.
“This downturn has changed the way we will think about our business,” says Steve Odland, Office Depot’s chairman and chief executive.
The company kept its three-year planning process, so employees have a vision to rally around. At monthly budget reviews, though, the company reacts to fast-changing customer needs. For example, after noticing that cash-strapped customers were less likely to purchase pens and paper in large quantities, the company quickly rolled out displays promoting individual pens and five-ream paper boxes—half the regular size.
Pleased with the popularity of those items, Odland plans to keep up the monthly reviews.
— Adapted from “Strategic Plans Lose Favor,” Joann S. Lublin and Dana Mattioli, The Wall Street Journal.