You can’t expect the organization to “just know” how to pull together a quarterly plan. Working without an agreed-upon framework can often be a recipe for disaster.
- Lenny Rachitsky and Nels Gilbreth
As companies grow they need to introduce regular planning cycles. These help reinforce the strategy, coordinate between teams, give everyone visibility on what’s going on and provide a moment to reflect on progress made.
But quarterly planning is also one of those processes that can often go wrong, causing a lot of work and frustration, for vague benefits. It’s easy for the tail to wag the dog, and the quarterly planning process itself to overshadow the real objectives of planning and the principles that lead to an effective planning cycle.
It’s not uncommon for teams to spend months writing up detailed plans, cutting into the time they have to actually deliver work. This is all the more frustrating when there’s a lack of alignment between stakeholders or a change of priorities that renders so much work useless shortly after it’s done.
Done right quarterly planning can unlock huge benefits for the organization, including focus, strong morale and delivering impact. Implemented incorrectly and it can cause stress, frustration and slow down progress.
Note:
In this article we’ll often refer to quarterly planning, as the most common cadence that companies run a formal planning cycle. However, it’s not unusual for companies to use a different cadence - e.g. annually, every 6 months, every 6 weeks. Whatever the period you’re planning for, the process is the same, though you might want to scale the time taken and depth of planning to match.
We’ll also reference OKRs as a common goal setting framework. Your company might use something else, but the principles and process we discuss will be the same.
In this article we’ll cover how to run a efficient and effective planning cycle, and provide quarterly planning templates for:
- Planning Process Timeline
- Strategic Context Briefing
- OKR Overview & Team OKRs
The advantages of quarterly planning
Quarterly planning helps split a company's goals down, and create clear focus for what teams should work on.
This benefits everyone:
- Direction - individual teams have a clear mandate and context for what they need to work on over the next few months. This points them towards high impact work and helps them (re)prioritize existing epics in their backlog.
- Alignment - multiple teams can work together on a common strategy, with teams from different disciplines coordinating their plans to complement each other and deliver even more impact.
- Visibility - the whole company can see what everyone else is working on, and how much progress the company is making as a whole.
The challenges of quarterly planning
However, despite the benefits, quarterly planning can often be a painful process that teams dread.
Teams can spend lots of time planning, under huge pressure to deliver targets, and struggling to provide sensible timelines for vague deliverables. At the same time, leadership can handover plans at the last minute, change the top priorities late in the day, or even pivot after planning is complete. Needless to say, these are all signs of poor planning that is unlikely to be worth the effort.
Common planning anti-patterns include:
- No strategy - Without a clear strategy, teams set plans independently, leading to conflicting initiatives and wasted effort.
- Changing focus - Every time teams change direction, they need time to understand the problem space and get up to speed. This can take months, and so should be done sparingly - changing direction every quarter will reduce the effectiveness of teams.
- Treating quarters as fixed blocks of time - Quarters and other time periods are arbitrary divisions of time. Forcing teams to plan exclusively into these blocks prevents them from considering bigger initiatives that will take longer to implement, and encourages them to fill gaps in their plans with low impact work, just because they fit.
- Focus on outputs - When leaders specify the features they want built, rather than the results they want, organizations don’t harness the expertise and insights available to them. As a result, initiatives often fail to deliver the intended results, and company progress slows.
- Poor capacity planning - When teams fail to calculate their capacity accurately, they end up overcommitting, disappointing stakeholders and destroying their credibility. A general rule of thumb is that teams need to spend 20-50% of their time on tech debt, infrastructure optimisations, bug fixes and supporting other teams. Tracking this team-by-team allows you to set this allowance even more accurately.
- Ignoring dependencies - Teams often plan in a silo, ignoring the work they need other teams to complete for them to be successful, as well as the work that other teams are expecting them to do. The results are overestimating what can be completed in a quarter, and how effective that work is.
The key to avoiding these anti-patterns is for everyone to understand the principles behind a good planning cycle, and to run a transparent process that everyone understands.
