Improving Strategic and Operational Planning


To grow a midsized business quickly and profitably, CEOs and their management teams need strong planning processes, to both guide and operationalize strategy.

But strategic and operational planning is not easy to do. Midsized companies don’t have the months of time or seven-figure budgets to do strategic planning exercises designed by big consulting firms for much bigger companies. And with all the changes that surrounds midsized companies – new competitors, customer demands, technological shifts, and more – you have to be able to change your strategy when necessary, yet resist the urge to tinker too much.

Just as importantly, midsized company CEOs can’t afford anyone on the team losing focus on day-to-day operational excellence. If their company gets sloppy about running the core business, it is likely to have a cost.

That’s why midsized companies must do both strategic and operational planning, but never mix the two. Blending them distracts the team from day-to-day execution and produces superficial plans.

What We Can Do

CEO to CEO helps companies create rigorous and competitively distinctive strategic and operational plans. We get your leadership team aligned on the basics and the details of your strategy: target customers, core products and services, and the basis on which to compete (e.g., price, value-added service, innovation, etc.). After articulating what is too often unarticulated, we help you turn that strategy into concrete operational plans.

We then make your operating plan come alive. We help your people monitor progress and adjust course to achieve business objectives. To make that happen, we set up what we call the leadership operating system. You can implement this tried-and-true process in four to six weeks, then monitor it to keep the operational plan on track.

The process ensures that every executive in your company understands his or her specific operational objectives, the time frame for achieving them, and how to share progress updates. This is the essence of business planning and monthly/weekly reviews. It ensures all parties progress toward key business goals.

How We Do It

Our consultants conduct three types of activities to create sound strategic and operational plans for clients:

  1. Getting leaders on the same page. Once the business leadership operating system is implemented, the CEO, CFO and other top managers are given access to continually updated dashboard data on progress against operational objectives. CEOs don’t have to waste time requesting reports. The entire leadership and management team has access to data to make daily decisions nimbly.
  2. Making operational progress happen without nudges from the CEO. Leadership teams will learn to move the ball forward without prompting from the CEO. For example, if an operational goal is increasing business development activity, progress will be transparent to the whole team. That encourages leaders to step up their performance. Additionally, supporting teams such as HR can identify areas where the company may need to apply extra resources to meet goals.
  3. Keeping strategic planning distinct from operational planning to avoid distractions. While the operational plan focuses on executing current business strategy, strategic planning focuses on what your business should be doing for the next three to five years as business conditions change.We help midsize businesses create strong but realistic growth strategies, with a methodology sized right for their companies. We use zero-based thinking, setting aside any presumptions about the current strategy and considering all the options and realities without regard to past investments. We help companies identify the strengths, weaknesses, opportunities, threats and trends (SWOTT) of the present, those likely in the future, and make plans to adapt.

The case studies below will illustrate how we make operational and strategic planning a strength for midsize companies.

Client Case Studies

Helping GoGrid Jump on the Cloud

Client GoGrid


Since 1991 John Keagy has built and sold a number of successful Internet services companies. His most recent creation is GoGrid, one that he repositioned in 2007 even though its predecessor was healthy and growing. Four years later, John’s hunch appears right on the money. GoGrid finds itself in one of the fastest-growing sectors of the $3.3 trillion global information technology industry: cloud computing. And the firm has more than doubled its revenue.

Part of John’s story is a familiar one in Silicon Valley: a visionary, driven CEO who launches and leads his firm to rapid growth. But other parts are less typical. First, he put his own money behind his companies: he funded GoGrid and its predecessor (ServePath) without outside investments. Second, he realized that repositioning and managing a firm far bigger than any he had run before required him to raise his game as a CEO.

John’s instinctive grasp of the potential for cloud computing has certainly been on target. Cloud today is a $40 billion sector of the global IT industry that is projected to balloon to $240 billion by 2020, according to one respected industry market research firm (Forrester Research). Even Larry Ellison, the legendary founder and CEO of software giant Oracle, has had to backtrack on his skepticism about the cloud market. (He once called it so much “water vapor.”) In October 2011, Oracle announced it would pay $1.5 billion for a cloud company called RightNow Technologies. And while cloud services might not be as tangible as smart phones or notebook computers, rest assured that cloud is white hot – as hot among venture capitalists as any IT sector.

GoGrid has commanded a great deal of attention despite the fact that it lacks the funding of much larger rivals in the cloud space, including Amazon.com and a venture-funded and now publicly held firm called Rackspace Hosting Inc. In fact, GoGrid, a privately held based in San Francisco, is viewed as a market leader in one corner of the cloud market: infrastructure as a service.

GoGrid has been cited in such prestigious publications as the Economist (click here for the story) and The Wall Street Journal (click here).

John himself has been lauded by tough Silicon Valley technology sector watchers, including the highly influential GigaOM blogging site. “Under Keagy’s watch, GoGrid has been expanding in terms of scale, scope and capabilities at a fairly rapid pace – all without venture funding – and it has developed a reputation for quality performance,” wrote GigaOm blogger Derrick Harris in June 2011. (click here)

GoGrid’s growth has been stunning, and over the last five years Rob Sher has helped John improve the way he leads the organization. “When a business’s pain points come to the CEO level, that’s where Rob can really help,” John says. “Rob can bring multiple department heads to work effectively together. That saves the CEO from needing to be a Judge Wapner” (of the TV hit show ‘The People’s Court.’)

John readily admits that was the case at GoGrid and its predecessor firm for years. “I had bootstrapped the business myself and so, as you can imagine, everything unfortunately revolved around me,” he says. “The business couldn’t function without me, and that’s not healthy. It won’t let a business scale. It wouldn’t let me go on vacation.”

John has since been able to take peaceful vacations. The guidance he and his team have received from CEO to CEO has ranged from the strategic to the tactical. John’s first assignment for Rob was of the latter type: to help the firm attract hard-to-find tech talent by creating “sizzling” collateral that marketed GoGrid as a model place to work in the highly competitive Bay Area.

Soon after helping John and his management team wrestle with a number of critical decisions and tasks, Rob was asked to help the firm with its biggest strategic challenge: creating the business plan to reposition GoGrid from a managed hosting company to a cloud software vendor. While this may sound like two ways to say “IT services vendor,” it isn’t. Using its own computer hardware, a managed hosting firm typically maintains their hardware and stock operating software at the ready for customer applications. A cloud software vendor, in contrast, writes software and provides access to it as a service (SAAS) to run customers’ critical business applications and technology infrastructure.

The difference is similar to providing an airplane and access to a runway (the managed hosting firm) or engineering and building the plane and the airport (the cloud software vendor). A cloud software vendor must spend far more on research and development to ensure its software is flawless and its data center infrastructure is modern, secure, and fail-safe. “We went from a company that didn’t spend much on R&D to a company that spends a third of its revenue on R&D,” says John.

The shift in GoGrid’s business model required John to raise his game as a CEO. He is a creative “out of the box” thinker with tremendous passion and charisma. But coming up with new ideas – especially new complex software products – wreaks havoc on an executive team that is trying to implement the last idea. In terms of leadership skills, Robert taught John the importance of committing to a plan. To reposition GoGrid, John put the firm’s business plan on a large poster and kept it hanging in the executive conference room. John then signed the poster and had his team do likewise. The symbolism was big. It showed John’s team that he was fully committed to the plan and the transition to a cloud software vendor.

John also learned how to delegate better – entrusting his executives with executing their part of the strategy without lording it over their moves. They all learned to set and live by an office code of conduct: No one would be allowed to yell or display other forms of unprofessional behavior in meetings, including John himself.

In another key part of the transition, Rob helped John determine what skills his management team had to master in order to make the transition. “We had one guy who was a staff systems administrator, who had then had become manager of systems administrators, and then had become the director, and then a vice president,” John says. “Not only did he have to learn management on the job, he then had to learn executive management, and managing managers. We have several people like that who became vice presidents who had gained all their professional experience working for one company.”

Rob designed a training curriculum so that the rest of the management team could raise its game too. He worked with several GoGrid executives and brought in additional advisors with specialized skills (e.g., on running an R&D organization). The firm made several new management team hires as well.

GoGrid’s growth has been rapid. In the four years that CEO to CEO has worked with John and his team, revenue have more than doubled. Additionally, the firm has expanded globally. GoGrid has two data centers today (San Francisco and Ashburn, VA.), and clients across the U.S. and Europe.

In June 2011, John announced that a new CEO, Warren Heffelfinger, would run the daily operations of the company. After nine years as CEO of GoGrid and its predecessor company ServePath, John is now executive chairman. This new role allows him to focus on long-term strategy and relationships with key customers and business partners.

John sees Rob’s assistance as invaluable in GoGrid’s successful transition from managed hosting to cloud services firm. “Rob operates as a comrade and a peer for the CEO,” John says. “He knows so many CEOs and has been working on CEO pain points for so long that he’s not going to get thrown something that he’s unfamiliar with. He understands the CEO’s challenges. That’s his expertise, and that’s where he delivers optimum value.”

GSC Logistics' Top Team Chart Clear Path to Faster Growth

Client GSC Logistics

In 1988, Scott Taylor and Andy Garcia left their executive jobs at two San Francisco Bay Area consumer goods distributors to set up their own firm. They have never looked back. More than two decades later, Scott and Andy have steadily driven their firm, GSCLogistics, to become the largest logistics provider at the Port of Oakland.

GSC today handles in excess of 15% of the goods that come into the port, third-largest international gateway on the West Coast. The firm has come a long way from its early years shipping Gatorade to Northern California food and drug stores, and has gained a customer list that includes some of the biggest names in retailing: Target, Walgreen, JC Penney, Crate & Barrel and many more. Yet despite building GSC into a $35 million business by 2010, neither Scott (CEO) nor Andy (chairman)were satisfied with their firm’s growth. In fact, they thought GSC should have grown much faster, but by the end of 2010, their immediate concern was enabling the firm to better manage their existing business.

Scott, Andy and their 15-member management team had scrambled to manage the biggest third and fourth quarters GSC had ever seen in its business. Shipping containers were flooding into their Oakland cross-docking facility at 30% over plan because a key customer, in an impressive vote of confidence, shifted its business to GSC from another provider in a different port.

By December, Scott decided the management team should hold an off-site meeting to review what went well, what didn’t and – most of all — what the firm needed to do in the future to accelerate its growth. The question would be who should lead the meeting.

Earlier in 2010, GSC’s chief financial officer, Joel Lesser, watched Rob Sher moderate an Association for Corporate Growth (ACG) panel of CEOs with a deft hand and with confidence. After hearing good things about Rob from others in ACG, Joel envisioned Rob leading the GSC offsite.

But Rob first had to sell himself to GSC’s two owners. Joel brought Rob in to meet Scott and Andy. After an initial discussion, Andy, who is skeptical of the value of consultants, challenged Rob: “How do you think you’ll be able to make our offsite more productive when you don’t know anything about our industry or our company?” Rob described his approach: before the offsite, he would meet one-on-one with each management team member to understand their issues and ensure they would be discussed at the offsite. The second benefit of meeting with the team in advance was that it would help Rob know far more about GSC’s challenges going in. He told Andy and Scott that letting an outsider without a vested interest run the offsite would be to their advantage – particularly an outsider with insider knowledge. All of that resonated with both owners.

Scott was especially impressed and excited about having Rob run the meeting. “He had a great way about him,” Scott says. “Rob was very calming and very, very engaging — not a hyper guy. The personality came through strongly, and I really liked him when I first met him.” They agreed to let Rob facilitate the off-site meeting to be held in a local hotel that December.

The meeting went exceptionally well, bringing a number of current and future growth issues into focus. “It was a very, very effective meeting,” Scott says. “Rob found a way to solicit opinions and get everybody engaged – better than if we had tried to do it internally. He is such a good people person that he can bring the personalities together, disarm everybody, and make them feel comfortable and have equal voices. It takes somebody outside the organization to effectively lead this kind of meeting. He’s a very calming influence. Nobody feels like they better be careful about what they say. He puts you at ease.” The team came out of the offsite energized and organized, with a list of action items to work on in 2011.

By February 2011, Scott was convinced the firm needed more of Rob’s help to continue the momentum of the offsite and focus the firm on growth. Scott voiced his concerns to Rob about GSC’s ability to grow at a faster clip. Says Scott: “I told him that we had to start thinking outside the box with the way the economy was going and our challenges in this industry, which is low margin and very competitive. I said that we had to do some things very differently and asked Rob whether he could help us out.” At the time, GSC was pursuing an acquisition in the Pacific Northwest, but it was getting harder and harder to expand its core business.

Scott and Andy’s first request was for Rob to help with the firm’s sales plan. But after listening carefully and thinking about the offsite discussions, Rob suggested he help them and their management team create a three-year business plan. “At first, we didn’t see the value in that,” says Scott. “But Rob said he had a way to create a one-page business plan. We’re now knee-deep into that exercise with our top six people, both sales and operations. It’s been an extremely enlightening exercise because it has focused us and helped our team members become much more open and transparent with each other. We’re starting to see the fruits of our efforts already.”

One of the ways Rob has helped the GSC management team is in learning how to evaluate ideas for growth. Rob demonstrated a systematic way to vet ideas without dampening managers’ enthusiasm for volunteering them. For example, one GSC team member suggested that the company not only deliver goods imported through the Port of Oakland but also handle goods to be exported through the port. Rob taught the management team how to conduct disciplined research to evaluate the idea, including determining the investment to implement it. They quickly realized that the export business would require specialized equipment, personnel with skill sets the company didn’t have on staff, and other big investments. They abandoned the idea.

But they didn’t reject the idea of expanding to an adjacent market segment. While researching the export plan, they realized that picking up or delivering domestic trailers at the railheads was not much different than handling their current business of transporting international containers. They even found another synergistic area of growth at their own deconsolidation facility. “Once we had filled a trailer to be shipped across the country on rail, we handed it off to another company,” Scott says. “We realized, ‘Why hand it off? Why don’t we take it to the railhead ourselves?’”

In logistics parlance, this is called the intermodal business. It’s become a new GSC division and revenue source, one that didn’t require significant investments. “It was the first time that our company had really analyzed a market segment and developed a plan on how to attack it – i.e., the people we would need, the systems and other investments,” says Scott. “Rob taught us how to create a rigorous growth plan.”

Part of the plan covers the integration of their first acquisition, which closed in June 2011. GSC acquired a Pacific Northwest distribution company called Best Way Trucking Inc. That enables GSC to expand its business beyond the port of Oakland to the Seattle-Tacoma region.

GSC now brings in Rob once a month to help keep its three-year plan on track. “Rob has a good business mind. It doesn’t matter what business you are in –- he figures out what he needs to know very quickly. He does a great job of bringing teams together,” says Scott. “Some of it is his personality: He’s non-threatening. He’s there to help you, not to criticize. He helps you be creative and look at things in different ways. I’ve been doing this so long that I get stuck in my ways. He’s able to help you think outside the box.”

Scott says GSC’s three-year plan has clarified the path to growth — $80 million is the target for 2014 (double 2011’s revenue) –- and therefore made it more achievable. “I can see how we easily transition from Phase 1 to Phase 2,” he says. “I’m not sure what Phase 3 will be yet, but I’m sure that as 2012 starts to unfold we’ll get a better picture of the operational and sales changes we need to make.”

Helping Hanson Bridgett’s Chief Hone the Law Firm's Growth Strategy

Client Hanson Bridgett


As with most law firms, San Francisco-based Hanson Bridgett LLP’s partners have long focused on delivering advice to clients rather than on non-billable activities to increase the firm’s market visibility. But in a severely contracting legal market, focusing on the work at hand and while neglecting the brand can be a recipe for disaster. CEO to CEO has helped Hanson Bridgett’s top management strike the right balance in recent few years and maintain its revenue – all at a time in which a number of competitors have closed shop or merged with other law firms.

Since the recession of 2008, the San Francisco legal services market has been a brutal one. That year, one prominent law firm (Heller Ehrman LLP, which had revenue of $500 million in 2006 and had been around since 1890) went bankrupt and was liquidated. Another (Thelen Reid Brown Raysman & Steiner) dissolved shortly afterwards. Several other San Francisco law firms merged with larger law firms.

Yet Hanson Bridgett, a $70 million firm with 350 employees in five Northern California offices, held its ground, maintaining its size despite a shrunken market.

“In the last few years, there has been significant consolidation in the legal industry,” says Andrew Giacomini, Hanson Bridgett’s managing partner. “The San Francisco Bay Area is one of the most competitive legal markets in the U.S. – both on the client side and on the talent side. That makes for very challenging economic conditions, which means people outside our firm need to know who we are. And that requires a very strong focus on building of brand in our market. For every law firm, it’s change or die.”

For Hanson Bridgett, that has meant elevating the game of its partners in developing new business, as well as becoming more programmatic about how the firm raises the visibility of its brand and grows the business. That’s why Andrew brought CEO to CEO in, starting in June 2009.

Rob Sher’s first assignment was working with Hanson Bridgett partners to improve the way they develop new business. “My goal was to have people in leadership positions in the firm take on more responsibility for our leadership initiatives,” says Andrew, who has led the firm since 2001. “That frees me up to focus on the things I needed to focus on, as well as help develop leaders in our organization.”

Rob worked with a number of Hanson Bridgett partners to create business development plans. After assessing their writing, public speaking and relationship-building skills, he helped them define a year-long plan with activities that would get them in front of new potential clients. The partners set their own deadlines, and Rob provided coaching to help them stay on track.

By November 2010, Andrew felt his firm needed additional help to increase brand presence in its Northern California legal markets. “I’ve been here my whole career, so I have blind spots,” he says. “Even if I’m innovative, I don’t have fresh eyes. In addition, I didn’t have the bandwidth to run this project and the other things I needed to do. I felt Rob had the right skill set.”

The first order of business was creating a growth strategy for the firm. In the first quarter of 2011, Rob worked with Andrew to develop the strategy and get the firm’s six other management committee members behind it. The next step was to define clear responsibilities for management committee in executing the strategy. (Hanson Bridgett’s partners vest the seven-person management committee with the authority to make most major decisions.) Previously, the management committee’s role was to come to meetings and make decisions on behalf of partners. “Occasionally and on an ad hoc basis, members of the management committee would take on projects,” Andrew says. The arrangement was too informal, the responsibilities too ill-defined.

Rob helped Andrew and the six other management committee members define the scope of their responsibilities. Rob then showed them how to operationalize those responsibilities: pairing up with someone from the next level down in the organization. Each “leadership pair” took on responsibilities for issues that previously had been on Andrew and his executive director’s plate. (The firm’s executive director is effectively the chief operating officer to Andrew’s chief executive role.)

For example, one leadership pair (a member of the management committee and the chief financial officer) focuses on financial issues: developing the budget, determining fees, approving write-offs and discussing collection issues. Another leadership pair is devoted to business development. This pair is the marketing director and the committee member in charge of business development initiatives that span the firm’s practice areas. In 2011, they launched a client feedback program and revamped the firm’s website, something Andrew used to be in charge of while also running the firm.

All this has helped Andrew get the top management team more fully integrated into the firm’s key initiatives. “The more leadership that can be developed in the firm, the more I can free myself to focus on external matters such as building a brand in the marketplace,” he says. “In five years, I want us to have a robust leadership team that allows the managing partner and the executive director to do other things.”

A critical task is differentiating Hanson Bridgett as a regional law firm. “We do not want to be part of a consolidation,” Andrew says. “Most law firms want to consolidate into big firms. We’re bucking that trend and trying to create a sweet spot right below that by focusing on the region here.”

Andrew views the impact of CEO to CEO as critical to the firm’s regional growth strategy. “We’re in a much better place than we had been during the recession,” he says. “Rob has been a catalyst who has made invaluable contributions to our company. He has been an architect for this big shift that needed to happen and someone who is helping us implement it.”

It hasn’t mattered to Andrew that Rob and CEO to CEO aren’t experts in law firm management. Andrew sees the firm’s expertise as in teaching CEOs of any professional firm how to be better leaders of their business. “Dealing with lawyers is a pain in the ass,” says Andrew. “Rob is very patient but persistent. Some people here took to Rob’s coaching and others resisted. He didn’t take it personally. He understood it might happen, and we all persevered through it.

“We’re in a much, much better place because of it,” Andrew explains. “Now we’re taking what we learned from Rob and building on it ourselves.” Andrew says it is just one of several “dangerous missions” he sees assigning to Rob and CEO to CEO.

More recently, Andrew asked Rob to tackle the thorny issue of a major change in the job duties of section leaders (business unit leaders). A majority of their compensation come from their own personal business development results and from their own billable hours. The firm’s culture (as is true in many law firms) gave high respect to high individual producers. The firm needed more leadership hours, yet compensation and expectations for those hours was unclear. The result was a lesser emphasis on leadership, and that was impacting the firm’s growth. With Rob’s coaching, two Hanson Bridgett practice leaders in early 2012 crafted a document with a vision of the role, duties and compensation of section leaders that was met with excitement and interest. Implementation plans are being detailed, and discussions with the partner compensation committee have begun. One of the section leaders is executing on the vision as a pilot in 2012.

“I feel like I’ve got this right-hand person I can call on to come in and take on these dangerous missions,” Andrew says about Rob. “That’s really a great asset.”

Offsite for New CEO Jumpstarts Planning Process

After ten years, a successful partner in a professional services firm was promoted to the CEO’s seat when his long-running predecessor moved toward retirement. The new leader turned to CEO to CEO to lead an offsite for visioning – the hoped-for future vision of the firm growing and expanding.

The predecessor had been a directive leader, setting the direction for the organization, including making all decisions. Because of this, the new leader found that many of the senior partners were not acting as proactive leaders when it came to business challenges (finance, recruiting, productivity, etc.). And many of the functional leaders were brand new. In the preparation for the offsite, we heard his observations of the weakness in the leadership team. Some pressing challenges (and our advice) shifted the focus of the offsite to helping the leadership team be more proactive by clarifying what had to be done and who would drive those activities.

The offsite was empowering for the entire leadership team. Each came away with a draft one-page plan, the core of what forms a Business Leadership Operating System (BLOS). We built and kicked off the BLOS, working with the team of 12 to hone those plans, coordinating approval of those plans from the CEO and training the team in this methodology. We supplied a cloud-based portal where the plans resided, and where each plan owner would maintain monthly scorecards and progress reports. We facilitated monthly plan review meetings for six months to coach and ensure the operating system was running well. We coached the CEO (meeting twice monthly).

Within a month after the plan set was completed, the CEO observed that leaders were “making things happen” without relying on or waiting for a “nudge” from the CEO. He was delighted. The call to action for more business development, peppered throughout the plans, moved the firm from needing more work to having an abundance of work. In the past, the CEO had to request data from the CFO to give to his team, which was time consuming for him. With the BLOS in place, the operating system connected all the leaders directly to the CFO for some of their dashboard data, a big relief.

Most leaders have stepped up their performance and are clearer on the results they must deliver. However, some are not capable (or don’t have the time) to attend to all the priorities, and the firm is hiring to fill in crucial gaps.

About Robert Sher

Robert Sher is founding principal of CEO to CEO, a consulting firm of former chief executives that improves the leadership infrastructure of midsized companies seeking to accelerate their performance. He was chief executive of Bentley Publishing Group from 1984 to 2006 and steered the firm to become a leading player in its industry (decorative art publishing).

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Forbes.com columnist, author and CEO coach Robert Sher delivers keynotes and workshops, including combining content with facilitation of peer discussions on business topics.

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