Once planted, watered and looked after for a year, Chinese bamboo has the special characteristic of showing no sign of visible growth after the passage of a full year. Curiously, after a second year of care, there is still no sign. Nor at the end of the third year. And not even after the fourth year of looking after it is there the most minimal sign of growth.
Only after five full years have past does the first little branch appear on the surface. From then on, one can see growth day by day, even hour by hour, and in only six weeks that seedling will grow and grow, reaching as much as 30 meters in height.
The allegory of Chinese bamboo is very useful for understanding the implementation of a Strategic Plan. On many occasions we’ve encountered Strategic Plans that are abandoned three or four months after being established, when managers are already asking about results and starting to get nervous.
Where are the sales growth and the expected results? Many of these questions end with the replacement of ambitious and expensive strategic initiatives with those defined by others of lower calibre. Not infrequently the Strategic Plan ends up abandoned six months later when there are no visible financial results.
We forget that, as with bamboo, the roots need to grow, in this case in the form of capacities and intangible assets (IT systems, dynamic organizations managed by projects, training programs, communication and culture change, effective systems for human resources, etc.), that far from producing results in the short term may even make them worse, since they require resources and do not contribute to sales growth for months and even years.
And like Chinese bamboo, these “roots” grow, but the results remain unseen for several years. We’re talking about profound, but hidden, modifications that must be maintained with perseverance. It is necessary to “defend” these projects from the attacks of the shortsighted, who demand immediate results. Only after several years do initiatives of this type begin to produce improvements in the processes that turn into radical improvements, which in turn produce radical effects in the perception of customers and finally exponential growth in the results.
This cycle differs also in the distinctive strategic guidelines that the company can choose. Thus, for example, the strategic line of operational excellence may require between one and two years to produce results. The strategic line of customer relations may need between two and three years. And, finally, the strategic lines that have to do with innovation usually do not produce visible results in less than three years.
This feature reinforces the need for a management system such as the Balanced Scorecard, which measures from different perspectives the development objectives of intangible assets (learning and growth perspective), process-improvement (internal perspective), value-proposition improvement (customer perspective) and finally economic results (financial perspective). Only in this way can we be sure that we are making progress on our Strategic Plan, and avoid the risk of abandoning it after a few months without seeing results.
As the economic environment becomes more changeable, it is more necessary to have a model of management like this that allows you to measure the progress of the Strategic Plan, although the financial results may not be evident. The traditional budget-tracking system inevitably leads to an increase in tension, when one verifies results have not improved for months or even years despite the heavy investment in strategic initiatives. As with the bamboo, these investments are necessary, and will produce exponential growth if you have enough patience and perseverance.
The Management Model based on learning and the Balanced Scorecard allows you to see if these initiatives are producing improvements in capabilities, and if those in turn are improving processes. If so, we can expect that the financial results will eventually come.
If we do not have this tool, stormy weather will arrive before long, which will make the boat change direction towards pragmatic goals and in the short term prevent it from reaching established strategic objectives. The Strategic Plan will die if we do not care for and measure the growth of the roots, just as would happen with bamboo if we were to stop watering it after a couple years because we think that the seed has died.