When using the OGSM approach to strategy, I often come across the question of how many initiatives a strategy should have. In the following, I summarize what works best in my experience.
When developing the implementation plan for your strategy, define about 2-3 initiatives per strategy. This gives sufficient focus without relying too heavily on a single action without alternative.
There are a few things to look out for however when selecting the initiatives to implement your strategy. I’ll provide an approach to selecting and testing your initiatives below to ensure that the 2-3 initiatives you pick are the right ones.
Defining the initiatives to implement your strategy
A good strategic plan not only describes clearly what you are aiming to achieve. It also describes how you are going to achieve it. The OGSM methodology allows you to describe your strategic plan on one page detailing out your objective, your goals, your strategies and your measures. The objective and the goals together define what you intend to achieve. The strategies and measures together define how you are going to achieve it.
For the purpose of this article, I will not dive deeper into OGSM. But you can read our introduction to OGSM here.
Once you have defined your objective, your goals, and your strategies, you begin thinking about your implementation plan – your measures. I like to break down my measures into two parts: metrics and initiatives.
The metrics are the quantifiable targets and performance indicators that define success for each strategy. The initiatives are the actions and projects that will drive implementation of the strategy and lead you to success.
The reason I like to separate the two is clarity. When I first started using the OGSM approach about a decade ago, I noticed how my team and I often used “measures” and “metrics” interchangeably to describe the “M” in OGSM. We were wondering what the difference was and whether it made a difference at all. It did!
We understood measures quite literally to be things that we’d “measure”. Hence the metrics. So we defined a number of metrics for each strategy and left it at that.
However, during implementation during the year, we noticed that we were not quite sure whether we were on track to achieving the metrics by year end. We took a run rate (i.e. a lucky guess really as it didn’t account for seasonality) and figured that we must be about on track. Anyway, in the end things always work out, right?
Wrong. We had no clue. We were missing a clear articulation of what we needed to do to turn the strategy into reality and check whether we were on track or not. We needed a clear translation of the strategies into measures which included both metrics and an action plan. The metrics would allow us to track progress and keep us on track and the action plan would clearly articulate what had to be done by whom and by when to achieve the metrics.
From then on out, we always defined measures as both metrics and initiatives.
So then how many initiatives are right?
In the first couple of years that we split metrics and initiatives in our annual operating plan, our OGSM was basically a large action plan. We probably had about 5-8 actions per strategy – sometimes more than 10. All actions started in January, ran in parallel and ended in December. So across the entire OGSM with 1 objective, 6 goals, 4 strategies and about 5-8 measures per strategy, we ended up with close to 30 actions! This was not only a massive effort to implement, it was a massive effort to keep track of! We didn’t know better and proceeded.
It quickly became clear however that this was not going to be effective. Our OGSM reviews took 8 hours every month. We were committed to action and accountability and wanted to go through each initiative and confirm we were on track. When we weren’t, we wanted to know why and what we had to do to get back on track. With close to 40 initiatives one year, this took forever.
We had noticed that many of the initiatives we tracked were actions we had to do anyway during daily operations. We defined actions such as “visit 10 customers per quarter”. The action was specific, measurable, ambitious, realistic and time-bound. It was however also exactly what was expected of our customer service team anyway during a typical sales process.
We had also noticed that we described different actions under different strategies that actually contributed to the same projects. For example, one strategy had to do with driving growth, another strategy had to do with innovating. We noticed that we duplicated several initiatives that were counted under growth and under innovation. We were looking at the same topics over and over again just from different perspectives. That was redundant and a waste of time. So the following year we changed our approach.
In order to streamline our annual operating plan, we decided to define no more than 2-3 initiatives per strategy. Two or three initiatives per strategy meant we had max 12 initiatives overall, which was plenty for my team to handle. And we immediately noticed a change in how we implemented.
- We were much more focused. Fewer initiatives allowed us to allocate more resources for each initiative. It became easier to keep track of our OGSM. And it was easier to communicate and remind each other what was important.
- We were much more effective. We noticed that greater focus led to greater achievement of milestones and progress towards our goals and objectives. We had to put things on hold less often or pivot to change our approach.
- We were much more efficient. We noticed that we spent much less time reporting and discussing progress updates of the action items. Monthly reviews were much more efficient and took less time.
- We were much more successful. When we conducted our year-end review and looked at our achievements, a couple of colleagues were quick to point out that they felt our success was directly linked to our much more focused execution. This felt really good!
Since then, I always guide my teams to define no more than 2-3 initiatives when designing the measures for the OGSM. This avoids building a laundry list of actions. Instead, fewer initiatives keep the team on track, allow greater concentration of resources for each initiative, and vastly increase the chances of success.
How do I select my initiatives?
OK, got it. So I am only supposed to choose 2-3 initiatives for each strategy. But how do I choose those initiatives? How do I know which ones are the right ones? Excellent, those are the right questions. Unfortunately there is no hard and fast rule. But this is what has worked well for me.
During the strategic planning process, I conduct a SWOT exercise for my business. In the team, we reflect on our core strengths and our biggest weaknesses, we look at the most promising opportunities and the largest threats. We do this by conducting an internal assessment but we also use our customer satisfaction feedback to get an external perspective. This gives us valuable insights into what we need to do differently. The SWOT informs our strategies and then the detailed initiatives with which we implement our strategies.
The SWOT analysis is probably my primary source for initiatives. In addition, we may conduct a brainstorming exercise with a cross-functional team to come up with additional ideas. All ideas are then ranked based on cost vs. benefit or impact vs. complexity. We choose those initiatives with the largest impact towards our metrics and goals with the smallest strain on resources.
After you have chosen your initiatives, write the initiatives in the ‘what-by-how’ format. This means structuring the sentence that describes the action in two parts: the ‘what’-part and the ‘how’-part. The ‘what’-part describes what needs to get done. The ‘how’-part describes how it will get done. Here are a couple of simple examples:
- Win new customers by launching a targeted social media marketing campaign
- Save costs by combining trips wherever possible
These are just examples to illustrate the ‘what-by-how’ method. I first learned about the ‘what-by-how’-format from the practical OGSM guide “The 1 Page Business Strategy” by Van Eck & Leenhouts. It’s a great way to write your initiatives as clearly and measurable as possible. Make them unambiguous. Leave nothing to chance.
Finally, make sure that each initiative has a caretaker and a clearly defined timeline and milestones. Ask the caretakers whether they understand what is expected of them. Ask them to describe their initiative in their own words. Clarify when and how you expect them to report on progress and what successful delivery looks like. Check whether they have the resources, knowledge and skills to be successful. Remember, nothing gets done unless accountability is clear and caretakers buy in.
How do I test my initiatives?
After you have selected the initiatives for your strategic plan, conduct a test to check whether the initiatives are indeed the right ones. Do four checks:
- Check for alignment
- Check for sufficiency
- Check for clarity
- Check for resource sufficiency
Check for alignment to ensure that each chosen initiative directly supports implementing the strategy and achieving the desired goals and objectives for your strategy. This tests whether the initiative is actually effective in achieving the targeted goals in part or in full.
Check for sufficiency means reviewing all initiatives together and checking whether they fully implement all aspects of the strategy. This tests whether the chosen 2-3 initiatives fully address the purpose of the strategy and whether all measures and metrics can be accomplished. If aspects of the strategy are not yet sufficiently addressed, choose another initiative or swap for one with greater impact.
Check for clarity means confirming that the initiative is fully understood by the organization. Especially the people responsible for implementation must know exactly what is expected of them. Make sure that for each initiative there is a caretaker, clear actions, timelines and milestones defined. Ask team members to repeat in their own words what the initiative aims to achieve to check understanding and clarity. Rephrase the initiative in the strategic plan if needed to be absolutely clear.
Check for resource sufficiency means confirming that you or the team have the resources needed to successfully complete the action or initiative. Resources may mean money (e.g. cash, capital etc), time (e.g. number of employees / FTEs), knowledge (e.g. access to data or information), or skills (e.g. expertise, experience). Confirm that you already have access to the needed resources or can build them in time. Be realistic about this! This is not the time to be overly optimistic or try to be a hero.
Pro-tip: conduct the 4 checks with your team or if you are a sole business owner with a mentor or board member. It has always paid off for me to get a second pair of eyes on my implementation plan. Discussing the implementation plan in the team allows you to collect feedback, questions and concerns and further create clarity and commitment.
What if I have more than 2-3 initiatives?
When you choose your initiatives and you conduct your test and you realize that you need four or even five initiatives to implement the strategy, then go with four or five.
Each business is different and each strategy is unique. If you need five initiatives to successfully implement your strategy and achieve your goals and objectives – and you have the resources to do it – then decide on five. The purpose is to be successful and deliver results. No one will celebrate you for having followed the OGSM rules and having limited yourself to 2-3 initiatives if you fail to implement your strategy (spoiler alert: there are no rules).
The reason why I go with 2-3 is to force choices and to make trade-offs. More often than not, we tend to throw more resources at a problem than necessary. I call this ‘tossing spaghetti against the wall’ to see which ones stick. As so often in business, try to do more with less. If you can accomplish your strategy with only 3 initiatives, then you do not need number 4. If you need more than 3 to be successful, that’s perfectly ok too.
When developing the implementation plan for your strategy, choose 2-3 initiatives per strategy. This allows sufficient focus without putting all your eggs in one basket.
Conducting a SWOT analysis or brainstorming are effective ways to come up with initiatives. Prioritize initiatives by analyzing cost vs. benefit or impact vs. complexity.
For each initiative ensure you define a caretaker, timeline, and expected deliverables.
Conduct four tests on your initiatives to confirm they are the right ones: check for alignment, sufficiency, clarity, and resource sufficiency.
I hope you find this article useful and wish you success with implementing your strategy. If you have any questions or comments, why not leave a reply below. Would love to hear from you!
Van Eck, Marc & Leenhouts, Ellen (2014). The 1 Page Business Strategy – Streamline Your Business Plan In 4 Simple Steps. Pearson Benelux.