Avoid these pitfalls in planning your strategy.

• Author: Silverman, Stan
• Position: DIRECTORS & BOARDS' DIRECTORS ROSTER

One of the most important roles of a CEO and the senior leadership team is to develop and successfully execute their company's strategic plan. One of the most important roles of a board is oversight of the company's strategy. To quote a line from "Any Road," sung by George Harrison: "If you don't know where you are going, any road will take you there."

The foundations of the strategic planning process are the situation analysis and the SWOT analysis. A situation analysis describes the economic, competitive, technical, regulatory and societal environment in which the company operates and will operate during the plan period. The company has little, if any, control over trends in these areas.

A SWOT analysis outlines the company's strengths, weaknesses, opportunities and threats. Strategies need to be developed for the company to build on its strengths, minimize the impact of its weaknesses, take advantage of its opportunities, and defend against its threats. Directors should play an active role in reviewing management's situation and SWOT analyses, offering their own views of each.

Much has been written about the role of the board in the development of the strategic plan. I believe that it is management's responsibility to develop the plan with board input. The board's role is advisory: to pose questions to management to stimulate thought and provide guidance, to assess the risks of the strategies under consideration, and to evaluate alternative strategies. This process should take place over a number of board and board committee meetings, so that the directors have time to think about what is being presented before voting on the plan.

The board cannot hold management responsible for achieving the strategic plan if the directors play a direct role in its development. The board's role is to help management think about issues that may not be on their radar. The CEO and the senior leadership team own the strategic plan. The board's job is to monitor progress and hold the CEO accountable for results.

A CEO with a strong reputation and many past achievements has built up political capital. A board will take the CEO's track record into consideration when assessing strategies that are presented for approval. However, strategies presented need to be evaluated on their merit by the board and rejected if they are judged to have a low probability of success, are considered to be too risky, or don't fit the strategic direction of the company. It takes...