ProcurementTechnology
February 25, 2016

Using Technology to Build a New Culture of Planning

While Dwight D. Eisenhower’s famous remark that “Plans are nothing, planning is everything” may seem a bit radical, it does highlight the key aspect that the process of planning is more important than the actual product. While a plan provides that “stake in the ground” for monitoring organization performance, the process of planning provides a mechanism to support collaboration and consensus development around the means to achieve organizational goals. It also informs and communicates the direction of the organization to internal and external stakeholders alike.

Technology can play a key role in this communication and collaboration process. It can reduce the labour burden and time often associated with developing meaningful plans. It can help all levels of the organization “see the big picture” and more importantly, their part in it. Technology and supporting data structures, offer the promise of “one version of the truth”, It also reduces the time and effort spent on low-value added activities like gathering plan information from disparate sources, continual comparisons/validation of results, and managing the revision/approval process.

In a recent survey conducted across the planning community of a mid-sized federal department, it was estimated that over 40% of the total time spent in planning and reporting was expended on these types of low or non-value added activities. Enterprise technology enablement helps reduce the effort expended on these items thereby freeing up more time for the truly value-added aspects of planning: monitoring, analysis, and decision-making.

Integrated planning is essentially all about alignment. It involves coordinating and linking the three often disjointed components of planning; strategic, operational, and resource/financial planning. It also involves the ability to monitor and report on the expected results derived in each of these planning processes. The interdependency between these components is shown in Figure 1.

Haley

Strategic planning sets the direction for the organization and establishes longer-term objectives that help contribute to its vision and strategic outcomes. The strategy is then aligned to operational planning which consists of two reciprocal elements; front-line program/functional planning and the identification and alignment of corporate services requirements (i.e. HR, IM/IT, Procurement). This is ultimately where the proverbial “rubber hits the road” as annual work plans are developed to deliver on the programs and services necessary to achieve the organizational vision and mandate.

Finally, available resources (i.e. staff, assets, operating budgets) need to be balanced and aligned to what is required to execute on these operational plans. The challenge is that these planning components are both highly symbiotic and iterative in nature. Without a suitable means to rationalize resource deployment to execute on operational plans that support strategic objectives, the process often becomes fragmented and indeed, error-prone.

The good news is that there are a variety of readily-available technologies that can help streamline these processes as shown in Figure 1;

Logic models and/or strategy mapping solutions provide the means to both articulate and visualize the causal relationships between strategic and operational outcomes. These tools ultimately help tell the “performance story” and both qualify and quantify how front-line outputs help achieve longer-term expected results.

Business planning and budgeting solutions deliver techniques and tools to assign and balance the resource requirements considered necessary to execute on operational plans and objectives. They readily manage the iterative process of budget formulation (both top-down budget allocations and bottom-up operational budgeting), forecasting, budget re-allocations, and financial management reporting. They provide managers the ability to better manage the limited resources available (particularly in the public sector) to optimize both program and/or service efficiency and effectiveness.

Business modeling and optimization solutions offer users the ability to create comprehensive interactive models of their business processes to better understand input (resources) to activity (work) to output (products and services) relationships. In this fashion, managers can readily comprehend the resource consumption requirements that support costing, efficiency analysis, business constraint, and “what-if” scenario-playing.

Scorecarding and dashboard solutions provide the means to not only monitor and report on performance indicators derived in the planning process, but ultimately demonstrate “value for money” by visualizing the linkages from resource consumption to strategy achievement. They also offer a platform to provide qualitative feedback and collaborative commentary around the attainment of performance objectives; be they expected results, indicator targets, or project/initiative milestones.
Gartner labels the above class of technology tools as Corporate Performance Management (CPM).

Specific vendors also use the term Enterprise Performance Management (EPM). In this regard, Garter defines performance management as: the combination of management methodologies, metrics and technologies that enables users to define, monitor and optimize results and outcomes to achieve personal or departmental objectives, while enabling alignment with strategic objectives across multiple organizational levels: personal, process, group, departmental, corporate or business ecosystem.
Gartner publishes a review of the major CPM technology vendors in their annual “Magic Quadrant for CPM” research summary. Not surprisingly, all three of the largest enterprise class technology companies (IBM, Oracle, and SAP) have CPM suites considered to be in the leader’s quadrant (i.e. high ratings on completeness of technology vision and ability to execute).

Unfortunately, the implementation of these technologies is often done piecemeal without consideration for the full value that a completely integrated CPM suite offers in supporting a truly aligned business planning and reporting environment. While most organizations begin their CPM journey by introducing or expanding one of these key business management technologies, this is often done in a disparate fashion across various business units. This generally leads to sub-optimization of both the business practices and the supporting technologies. This can cause further challenges when trying to standardize methodologies in the design of a truly enterprise approach to performance management. It is therefore important to “begin with the end in mind” not only for integrated planning and reporting as a business approach, but on how the various components of technology enablement fit into “the big picture”.

In the federal government, a number of departments are beginning to overcome some of these challenges as they continue to explore the capabilities of CPM solutions. Over five years ago, Transport Canada was considered an early adopter by implementing some of the Oracle CPM tools in the design of their Enterprise Resource Management System (ERMS). More recently, Citizen and Immigration Canada has been working with the IBM-Cognos toolset as part of their ePlanning initiative while Health Canada is currently deploying SAP’s Enterprise Information Intelligence Software Solution (EIISS) for Government as part of their Planning for Enterprise Performance or PEP project. In all cases, the drivers behind these implementations have been threefold; reduced burden on departmental staff and managers for plan development and management, improved accuracy of both operational and financial performance forecasts, and enhanced decision-making at all levels of the organization.

In summary, the application of modern enterprise-class technology should be seen as an enabler for strengthening the integrated planning process by providing visibility into not only how plans are executed, but why they are done. In this fashion, planning can indeed be “everything” by making it a truly engaging value-added exercise that provides the foundation for a strong performance culture in any organization.

About this author

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Mike Haley

Mike Haley is President of Landmark Decisions and a board member of the Performance and Planning Exchange (PPX). For over 20 years, Mike has worked with both private and public sector organizations to help architect planning, costing, and performance content that can be readily supported by enterprise technology solutions to enhance organizational efficiency and effectiveness.

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