// Good morning — today kicks off a three-part series on annual planning, and we’re starting with the step almost everyone skips.
… And for any new readers, welcome to Signal // Noise — the newsletter read by founders, CEOs, and scrappy builders every Thursday. Each week, what I’m listening to, one deep dive, notes from the field, three links worth your time. No buzz, no bullshit.
| THE SIGNAL |
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If Nobody’s Arguing, You Don’t Have a Strategy
I may be a rare breed of founder who actually loves annual planning (this will surprise no one who knows me). I also love teaching other founders how to do it well.
But last year, in one of my newsletter write-ups, I actually skipped a step, and it’s one of the steps that I think matters most.
But before we dive in, here’s the full stack of what you need as a founder or CEO, from why you exist down to who owns what this week:
Piece | What you define | Typical horizon |
|---|---|---|
Foundation | Mission, vision, and values: why you exist, what success looks like, how you behave | Long-term |
North Star | One metric that reflects the value you’re creating | Track consistently |
Strategy | Choices about customers, offerings, advantages, and what you’ll pass on | Multiyear, reviewed annually |
Annual goals | Targets for growth, profit, customer outcomes, and other priorities | Annual |
Financial plan | Your forecast (what you expect) and budget (what you’ll spend and hire) in one model | Annual, revisited quarterly |
OKRs | A few objectives with measurable key results, the initiatives behind them, and one owner for each | Usually quarterly |
Review cadence | Regular check-ins to track progress, make decisions, and adjust | Weekly, monthly, quarterly |
Last year around this same time, I wrote a two-part series about annual planning, and I jumped straight from the goal to the financial plan.
Pick a number, model it, build OKRs, hold the team accountable.
Boom, done.
However, I skipped the strategy row entirely.
And that’s the row that I think is easiest for a busy operator to skip.
So before we get into goals and the financial plan over the next two weeks, we’re starting with strategy, which is the most overlooked piece and the most important one.
The Opposite Test
Look at your annual plan, if you even have one.
Most plans — if not yours — are a list of things to do or goals to achieve: grow revenue, improve retention or reduce churn, invest in AI, make a few great hires, keep customers at the forefront, etc.
There’s nothing really to push back on; everyone nods, meetings end, typey cat gets typing.
But that agreement is the warning sign you should pay attention to.
Roger Martin, former dean of some fancy B-school, who also co-wrote Playing to Win, has a 30-second test that is actually super applicable here.
It states, you gotta say the opposite of your choices out loud. If the opposite of your choice is plain stupid, then you didn’t make an actual choice. In fact, you don’t have a strategy at all.
For example, let’s say your strategy is “Improve retention.”
The opposite of that would be “lose more customers” — said no one, ever.
Hence, that’s not a choice; it’s not a strategy at all.
His favorite example is mutual funds. Vanguard’s founder John Bogle said picking stocks was stupid, so everyone should just buy index funds. Fidelity — on the contrary — says portfolio managers are the absolute heart of its strategy.
Two hugely successful companies made opposite bets, and while you can argue which one you agree with more, you cannot argue against the fact that they both contain actual strategies.
Quick personal example: about five or six months before I left Hampton as CEO, we realized that in order to achieve the retention we desired for the business, we had to make a big change. We decided to move from mostly digital core groups to mostly in-person ones. A monster strategic shift.
Was it the right call? I certainly think so, but it’s up for debate, I’m sure. Plenty of great communities run digital-first, and they’re not dumb either. But that’s the point. Nobody could argue it wasn’t a real strategy.
Make Every Bet a “This vs. That”
Mckenzie Lock, who leads AI and product for Netflix’s content platform, ran her team’s strategy work on a simple rule: “You can’t just have a good idea versus a bad idea.” Both sides of a bet have to be something you’d genuinely want.
At $5M to $20M, that may sound like:
Move upmarket vs. win more of our core segment
Raise prices vs. hold price to take market share
Hire a VP of Sales vs. keep founder-led sales one more year
Pick two or three. Write down what you’re giving up for each. Then build your goals and OKRs from those choices, not from a random brainstorm.
Not every priority has to be strategic, btw. If churn is bleeding, fixing it goes on the list no matter what. Just don’t confuse keeping the lights on with a strategy.
Read It Back, Now
One more test, also from Lock. She had her leaders take turns summarizing a strategy someone else wrote, out loud, then answer questions about it. She said there was a lot of laughter when people heard their own strategy repeated back and realized it wasn’t concrete enough.
Steal this for your planning offsite.
No doc on the screen. No PowerPoint to read from. Ask each leader to explain the strategy in two minutes. If you get five different answers, or a recited list of all good things, you’ve got work to do.
Martin argues that if you’re totally comfortable with your strategy, it probably isn’t one. Because a list that everyone nods along to isn’t a strategy; it’s mostly a to-do list with a revenue goal on top.
Next week: we take your choices into the spreadsheet, and I’ll show you how to build a forecast that can change its mind.
| FIELD NOTES |
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What I’d Tell a $1M Newsletter Operator
Last week I made a surprise appearance on Letterland LIVE and got into community, taste, attention, and trust with Tyler and Louis, plus the advice I’d give anyone running a $1M newsletter. I also managed to blow up my own tech halfway through, so you get that bonus too.
The full conversation is here if you want the whole thing (I jump in around minute 40):
| A FEW JAWNS TO CHECK OUT |
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📕 Great post // Your Strategic Plan Is Probably a Budget
Richard Rumelt, the UCLA professor who wrote Good Strategy Bad Strategy, put it bluntly in an old McKinsey interview: “Most corporate strategic plans have little to do with strategy.” He says most are just rolling three- or five-year resource budgets with a strategy label on them. It’s from 2007, but this is as evergreen advice as you can find.
🎧 Sweet pod // Strategy in Five Questions
If the opposite test clicked for you, Roger Martin’s conversation with Lenny Rachitsky is the deeper version. He walks through the five-question “choice cascade” from Playing to Win, starting with what winning actually means for you, then where to play and how to win. It’s about 80 minutes, so save it for a long drive and buckle up.
📚 Book rec // Five Strategy Books Disguised as Business Bios
I don’t read many explicit strategy books, but the best business bios are often strategy books in disguise. Here are five I’ve loved: Call Me Ted, Shoe Dog, The Everything Store, The Ride of a Lifetime, and Apple in China. Every one of them is really about a big choice: what the leader bet on, what they gave up, and what it cost. Grab one for the holiday travel ahead.
Was this helpful? Relevant? Totally off-base?
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—> Or pass it to someone who’d get value from it.
Hope everyone has a great weekend.
And until next time, thanks for reading.
Jordan
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