In this article I will tell you about a simple but effective strategic planning tool PL3 (projects in 3 layers).
PL3 appeared as a tool out of the need to create a simple, fast and universal tool for working out the development of departments or companies.
As a result of a combination of thoughts, Norton-Kaplan maps, version control systems and a little logic, the idea was put forward to represent the activities of departments and the company as projects divided into 3 different levels:
1. Supportive (conservative)
The support level is responsible for projects that the company must support or implement in accordance with legal or industry requirements, as well as those caused by the need to ensure the life of the company. It is clear that there is no escape from laws and regulations, but there are projects that the company launches because it did not respond in a timely manner to the upcoming opportunities and risks, i.e. projects where the company plays a lagging role are successfully located here.
Of course, such projects are the least expensive for the company, for example, those implemented exclusively at the expense of the payroll, but such projects are not very interesting to employees, because do not contribute to their professional and personal growth and are aimed exclusively at the past, to eliminate problems that should have been solved a long time ago.
Despite the low risk, the company's task is to try to reduce the number of projects at this level. Such projects conserve activity, causing stagnation. I am of the same opinion as Jim Collins (How the Great Fall) that the strength of companies is not doing what they should do and not doing what they shouldn't do. Unfortunately, this is much easier said than done.
2. Optimization (stabilizing)
Optimization level projects are responsible for stabilizing processes in a company or departments and undoubtedly have a slight tinge of bureaucracy and standardization.
For a company, projects in this category may incur costs associated with updating information systems, optimizing business processes, and minor restructuring of the organizational structure. Such projects are aimed at the present and may interest employees for some time.
Risks increase because process optimization may slow it down temporarily or introduce a new class of errors that may take time to correct. It is also not difficult to imagine the reaction of the majority of employees to updating, say, a warehouse accounting system.
3. Developmental (innovative)
The development category is the most expensive, the most risky and the most promising. Employees who strive to develop and develop their company crave such projects. Some are willing to give up their salary and free time to participate in such projects.
Since this level is aimed at the future, projects can provide serious growth to the company.
There is a serious hidden catch here: if the company does not implement the majority of such projects, then employees gradually become disappointed and burn out, and management begins to think that they will never implement such projects and the company slides into conservatism with elements of stabilization. Therefore, to implement such projects, in addition to money, you need will.
It happens that projects that are created for the sake of the projects themselves or as a tribute to fashion (for example, a new technology has been released and urgently need to be implemented) end up here.
Visual diagram of PL3
Visually, this strategic planning tool can be represented as the following diagram:
Each element consists of the following parts:
The convenience of such a card is that it can be as simple and as complex as you like, depending on how much free time and budget you have. This map can also be easily drawn on a piece of paper or in a notebook, especially for those who, like me, have no drawing ability at all.
By looking at the map you can immediately determine what strategy the department/management/department/company is following. If there is not a single project in the “innovation” category, then such a division or company can hardly be called innovative.
If you need to create a single map of the company’s projects, you can ask department heads to first create their own maps, and then plot the selected projects on a common map (each in its own color). A simple move will show you where each division is looking and whether they have a common vision for the development of the company.
General recommendations for creating a PL3 map:
- The map must be created from the bottom up.
- A top-level project can be implemented without a lower-level project, provided that the company or division is ready for its implementation (HP law). If not, then a preparatory project must be carried out.
- The number of top-level projects should be limited due to the increased risk. Typically, risk is determined by the willingness to invest and forget about the invested amount. Large investments can lead to the death of a company.
- Keep the map simple, so that it can be printed on A3 paper and hung on the wall/board.
- Remember that this is not just a pretty picture, but money, people, technology and a bunch of unforeseen difficulties, so balance the risks.
I will be glad to receive feedback and suggestions for modernizing the map.