Racing and Strategic Planning – What it Takes to Win the Race! I recently went with my husband and son to the Kansas Speedway in Kansas City, KS to watch my very first stock car race. The experience was amazing and one I will never forget.

In the middle of the race (when cars were going around and around and there were no cautions for about one hundred laps) I got inspired to write this article as I saw a clear analogy between stock car racing and strategic planning. Since I had no paper or pen, I typed myself an email on my phone! Needless to say, it took me a while to type this entire article with one finger yet I thought it was worth it to share with you my observations as a result of this wonderful experience:

• I reflected on the importance of each race team having a strategic plan that everyone knows and understands. If only the driver knows the plan and the vision then the crew cannot support him/her. The same way, you can’t lead and run a company on your own. You need your crew and they need to know the specific strategies to win the race. Every person on the team has a job to do in order to win. If one lug nut is not tight correctly on the wheel, the car can lose that wheel and will be out of the race. At the minimum, will lose valuable time that can cost the team the victory.
• The driver is key but is not the most important person on the team. He/she drives the car but if the car is no good, he/she, nor the team, are going anywhere…the crew that prepares the car and supports the driver is hugely important to win the race. For example, if their driver is in first place and goes to the pit for gas or to change tires and the crew is not fast and accurate, the driver can lose the first place easily—in a matter of milliseconds.
• I also noticed there is constant communication on the ground among the team and between the “spotter” and the driver. The same should happen in a company. The leader needs to communicate with the leadership team and they, in turn, should communicate with the rest of the staff continually in order to keep the momentum going.
• The stock car teams are very organized and do things orderly. They follow rules. Every game, every sport, every team, every industry has rules. The best players follow the rules. They take them seriously because there are consequences and penalties if they violate the rules. Even though in corporate America daily decisions may not be life or death, the decisions leaders make do affect the lives of the employees.
• There are things ahead that only the driver can see or feel. He/she needs to communicate and alert the crew immediately to come up with a plan of action. For example, the driver may be the only one to notice that something is wrong with the car. At the same time, there are things ahead that only the spotter can see and need to tell the driver to watch for it. For example, if the spotter sees a wreckage and there is a fire, he/she needs to tell the driver if he/she can get through the smoke or not. If the driver makes a bad move, he/she can wreck and completely lose his car and in some instances his/her own life. The entire team loses—no car, no team. They have to trust each other. The driver’s life may depend on it. Again, the same happens in a company. Sometimes the leader sees things ahead and other times the staff sees things that are coming up that could affect the company’s performance.
• You could say the race is not fair. One driver could have the lead for most of the race (even one hundred laps!) and lose at the very last minute because of a wreck caused by one bad move or by another driver that cut him/her off or hit his/her car at the wrong angle and sent him/her spinning off the track. The same happens in life. Your company can be doing excellent for many years and all of a sudden the unexpected happens. One of your key employees leaves, or the market crashes, or a new competitor comes to town. It can be anything and you need to keep in mind that in those moments is when you have opportunities to start over or fix things that have been broken or on hold for a while in your company.
• I also noticed that if there were no cautions and the cars just went around and around it becomes boring. There is no action or adventure. That’s when companies get in a routine and start doing the same thing over and over. The employees become unchallenged, the customers get bored, and the leadership becomes stale. It’s time for a change and move things around. Time to introduce new ideas and do things differently.
• Finishing the race is what matters in the end. There was one car who went to the garage four times and every time he started a lap he had to go back and get something else fixed but he/she finished the race. In fact, drivers are rewarded with points for every race they finish regardless of how many laps they were behind. What goes on their record is that they finished. The same happens in business. Every time a company tries something new and it doesn’t work, the team needs to figure out new strategies to continue the race but they must never give up. They must finish the race.

Even though all the teams want to win and they all have strategies, there is only one winner. Only one driver and one team gets the trophy. Only one driver gets to do the “burnout” after crossing the checkered flag! Sometimes, however, even when you have the best team and the best strategy, life may throw a dart at you and your company and you don’t win. In those moments, you need to remember past successes, gather your team, pick up the pieces and with your head up, start over. The most important thing is to never give up and finish your race!

Disaster Recovery Planning – Time Well Invested! An earthquake, a war, a hurricane… I survived those three life events by the age of thirteen. Even though each one of those experiences left a mark in my life, they taught me many lessons and created an awareness that not many people possess. I became very appreciative of everything I have and of every person in my life. At the same time, it created a sense of “being ready” at any time for “what could happen” and what I would need to do to bring things back to normal again.

When I hear a train go by, my memories bring me back to the noise of an earthquake back when I was six years old in Nicaragua. A deep sound from beneath the earth, a sound of destruction. Your home, your office, and everything around you becomes distorted and destroyed right in front of your eyes. Your own life could be gone if you’re in the wrong place at the wrong time. I learned that all your possessions and what you worked so hard to attain can be “torn to pieces” in a matter of seconds.

When I hear the noise of a helicopter, it reminds me of the sound of machine guns in the background when I was twelve years old and lived through the war in Nicaragua. I remember going to bed with the rattling noise of the windows with each bomb that was dropped. They were close to my house and some days it felt as if they were fighting right in my own backyard. The terror you feel when you are helpless, only a victim of someone else’s war, is indescribable. You learn to appreciate life in a new way.

When I hear the sirens announcing the possible tornado coming to your city, it reminds me of the hurricane David I lived through in the Dominican Republic when I was thirteen years old. I observed from a fourth floor apartment about three miles away the waves from the ocean that destroyed the island and the noise of the wind getting through the windows in our apartment. I learned that everything you own can literally “blow away” in a matter of seconds too.

But I choose to look at life from the positive perspective and I’m grateful to God that I’m still here so I can help others in many ways. That’s one of the reasons I founded Malzahn Strategic. The three key things we focus on—strategic planning, enterprise risk management (ERM), and talent management—all have to do with disaster recovery planning. From the strategic planning perspective, you have to put strategies in place to protect your business from ANY disaster and to keep the company safe. From the enterprise risk management perspective, you need to have strategies to mitigate ALL risks that can potentially affect your company. And from the talent management perspective, you need a plan to protect your company from losing your KEY talent, protect it from internal fraud, and also to plan ahead for future talent to bring your company to the next level.

Disaster Recovery Planning falls under your IT Security Program most of the time, which in turn is part of your ERM program. Below is a simple way to start with a Disaster Recovery Risk Assessment:

Conduct a risk assessment based on your business location and probability of any type of incident happening:

• Threat/Vulnerability (include fire, flood, earthquakes, riots, tornadoes, etc.)
• Probability of incident (how probable is for this natural disaster to occur in your area)
• Severe Rating (how severe would it be if it were to ever occur – low, medium or high)
• Criticality (how critical would this incident be to your business – low medium or high)
• Confidentiality (this refers to data breach due to a disaster)

Conduct the following risk assessment based on the type of asset and then risk rate each asset:

• Asset Type: Application/Software, Process, System
• Asset Medium: Paper or Electronic
• Vendor Name
• Controls/Procedures in Place
• Description of Risks Associated with Asset
• Risk Mitigation: Description for Mitigation of Risks
• Risk Rating: Low, Medium, High
• Criticality to Bank or organization: levels 1 to 5 with 5 being the most critical
• Residual Risk: Low, Medium, High
• Information Classification: Public, Non-Public, Confidential
• Threats/Vulnerabilities: Level of Damage, Type of Vulnerability
• Threat/Vulnerability Likelihood: Low, Medium, High
• Vital Resources: Description of Vital Resources to the Bank Operations
• Recovery Point Objective (RPO): Description of How the Information or Asset Will be Recovered
• Recovery Time Objective (RTO): Approximate Time of Recovery

Something else to consider is that there are other types of disasters that are not “natural disasters” and they relate to your key talent in your company. I call that “Disaster Recovery for People.” I wrote another article called “Succession Planning – Is It Only for the CEO?” where I urge readers to consider the other key positions in the organization to have a backup for and be ready in case you lose those employees unexpectedly. Part of the DRP is also to include a Pandemic Disaster Plan. Regulators were very focused on that topic several years ago and for obvious reasons, it should still be part of your plan. The same way, having a data breach could be disastrous for your company as we all learned from recent incidents at large corporations that suffered a cyber attack. The biggest disaster is your damaged reputation and the financial damage that derives from that as a consequence.

I want to conclude by encouraging you to appreciate everything you have and the people in your life. I also want to encourage you to create a Disaster Recovery Plan for your institution and update it and test it annually. We don’t want to live in fear but we live in a world where life happens to all of us and we must be prepared at all times.