Your Say

  • Date:01 Feb 2007
  • Type:CompanyDirectorMagazine

Letters to the editor

Thanks to Domini Stuart for such a succinct article in the November edition on key issues for boards in strategic planning. I was heartened by the ‘Rubber Hits the Road’ section because it is not uncommon in my experience for organisations to do strategic planning because it is a requirement, without a clear understanding of the purpose or value of doing so, nor any clue as to how they will convert the thinking into doing.

In fact I would add three quick points to supplement that implementation thinking. First, having determined the preferred strategy, it is important to consider the gap between the current position and the requirements of the new direction. Reality dictates that aspirations must be tempered (but not governed) by what is achievable with present resources. Sensible approaches must be planned for development and transition towards the new strategy, particularly of the people involved, or present productivity will be compromised.

Second, taking the importance of communications from the article, the purpose of a strategic plan document (or documents) should be carefully considered. Is it for management and the board for reference, for staff, investors or other stakeholders? All have different needs and the purpose can have an influence over the style and structure of the messages and language that are captured in the strategic planning process.

Finally, and of greatest importance to the board in their governance role, is the need to seek a strategic update of performance against the plan at least every half year, and preferably every quarter. If the cost and effort of planning is worth doing then it is also worth monitoring. The strategic plan is not a coffee table book!

Malcolm Anderson MBA, MAICD

In regard to the article Marketing Metrics that matter in the December/January issue, I believe that measuring the value of investments in marketing is one of the oldest chestnuts in modern management.

Many CEOs and boards have been happy to have marketing expenditure recorded in the P&L as an expense, (aided and abetted by marketers), with no reflection on the long term impact of this expenditure on the value of the business because it is easier than the hard graft necessary to properly assess its value.

Why should cash expended on marketing be any different to cash expended on a piece of machinery? Why should the process leading to the investment, and the post investment analysis be any less rigorous?

Marketing expenditure is just another tool to assist a firm to outperform its peers and thus attract continued investor support. Intelligent investment in marketing starts with a rigorous strategic and customer centric analysis of the firm’s prospects, capabilities, ambitions, competitive environment, and priorities. It finishes with intelligent analysis of the value of the dollars spent versus alternative uses for the dollars, and the impact the expenditure had on the firm’s long term health.

The tools to achieve an objective measurement of marketing expenditure effectiveness are largely associated with a disciplined approach to strategy, and the effective measurement of its implementation. Anything less than a rigorous process is an abrogation of responsibility.

Allen Roberts
Marketing & Strategic Services