Planning for Planning

As 2024 draws to a close, many companies are immersed in strategic planning for the coming year. I've recently participated in several such meetings and have found myself reflecting on the differences between corporate and individual planning. This reflection has led me to consider how we can apply the structured approach of corporate strategy to our personal lives.

The Disparity Between Corporate and Individual Planning

Planning is a cornerstone of organizational success, yet it's often approached with less rigor on a personal level. Corporate strategy meetings are typically formal affairs involving pre-meetings within sub-teams, the preparation of detailed memos, and culminating in formal presentations to larger groups. Individual planning, by contrast, often consists of little more than New Year's resolutions, often inspired by fleeting social media trends. The level of detail and commitment differs significantly.

One key difference lies in the purpose of planning. In a company, strategic planning serves not only to set direction but also to align various teams and functions. This alignment becomes increasingly challenging as organizations grow larger. Smaller companies, by virtue of their size, can often achieve alignment with less formal processes. Furthermore, a company's primary objective is usually singular: maximizing profit. Individuals, however, juggle multiple, often competing, objectives encompassing health, family, finances, and personal growth. This multiplicity of goals makes precise planning more complex.

Lessons from Corporate Strategy for Individuals

While the context differs, individuals can glean valuable insights from corporate strategic planning.

• The Importance of Alignment: Just as alignment is crucial within a company, it's equally important within ourselves. This "internal alignment" involves consciously aligning our actions with our values and long-term goals. To move beyond impulsive, System 1 thinking and ingrained habits, we must engage our conscious mind (System 2) and actively reinforce our core beliefs through reflection. This concept echoes the Chinese philosophy of 知行合一 (zhī xíng hé yī), the unity of knowledge and action.
• Methodology and the Distinction Between Objectives and Goals: The methodologies employed in formal planning can be adapted for personal use. It's crucial, however, to distinguish between objectives and goals. An objective is a broad direction we pursue, a philosophical investment of our resources. Examples include contributing to human progress or providing better financial services to underserved communities. A goal, on the other hand, is a specific, measurable result derived from that objective. For example, if the objective is improving financial services, a goal might be to launch a mobile banking app targeting the unbanked population. On a personal level, an objective might be improving family well-being, with corresponding goals like spending more quality time together or saving for a family vacation.

A Framework for Personal Strategic Planning

Applying corporate strategy to personal life involves a structured approach:

1. Define Your Objective: Start by clearly articulating your overarching objective. What direction do you want your life to take?
2. Identify Opportunities and Problems: Consider the opportunities that can help you advance your objective and the problems that might hinder you. Opportunities involve exploring new areas with a high probability of adding value. This requires research and calculated risk-taking, much like placing a strategic bet. Problems are bottlenecks in your current efforts, requiring a thorough analysis of your "assembly line" of activities. Understanding each step and identifying points of friction is essential. Identifying opportunities often involves observing successful strategies employed by others and considering how they might be adapted to your own situation. Thinking in first principles—analyzing fundamental truths and building up from there—is another valuable technique.
3. Develop Solutions: Once you've identified opportunities and problems, generating potential solutions becomes more manageable. The key is to maximize the likelihood of success. This involves gathering information, developing mental models, and carefully weighing the potential outcomes of different approaches. Intuition plays a role, but it should be informed by data and analysis.
4. Gather Resources: Actively seek the resources necessary to implement your solutions. These resources can be categorized as:
   • Intellectual Power: This includes your own knowledge and skills, as well as leveraging the expertise of others or AI.
   • Trust and Network: It is crucial to build a strong network based on mutual trust. Simply knowing people is not enough; genuine collaboration requires a foundation of trust.
   • Raw Materials: This encompasses tangible resources like finances, infrastructure, tools, and data.
   • Power: This includes influencing decisions, navigating bureaucracy, and accessing public networks.
5. Regular Recalibration and Alignment: Continuous reflection and adjustment are essential. Just as companies conduct regular reviews, individuals should periodically assess their progress, realign their actions with their objectives, and make necessary course corrections.

By adopting these core principles of corporate strategy—objective setting, opportunity/problem analysis, resource allocation, and regular recalibration—we can transform our personal planning from a haphazard exercise into a powerful tool for achieving our goals.