It is certainly no secret to banking professionals and bank board members that the banking landscape has changed significantly following the financial crisis of 2008. Banks of all sizes now face radically altered economic and regulatory realities. To survive and, more importantly, thrive in this new environment requires banks and bank boards to be more proactive than ever before.

An important—perhaps the most important—element to proactivity is strategic planning. In our business, we run across banks of all shapes and sizes. I’ve spent years as a regulator and now an investment banker visiting with and observing the “haves” and the “have-nots” in our industry—and the associated outcomes associated with each type. If there was one element of bank oversight I could improve tomorrow, it would be the strategic planning process. We often tell bank boards of clients and prospective clients, “Whatever you are doing, do it on purpose.” In other words, have a plan.

Sometimes we are greeted with skepticism: We’ve all heard a variation of the old saw that no battle plan survives contact with the enemy. And that may well be true—but Dwight Eisenhower, no slouch at preparing and executing battle plans, reminds us that plans may be useless, but “planning is indispensable.” In other words, the process of systematically evaluating the challenges and opportunities facing your organization as it seeks to accomplish a set of defined goals is always worthwhile. It teases out differences in approach, sets the tone on corporate culture, and outlines benchmarks against which progress can be measured.

There are many benefits to instituting a planning process at your bank, but perhaps the most important is that the regulators expect it. The Office of the Comptroller of the Currency and the Federal Reserve endorse it. The Fed’s own examination manual stresses the importance of “designing, implementing and supporting an effective strategic plan.”  But we all know there is the “spirit” of the regulatory guidance and the “letter.” You can certainly go through the motions to ensure you have a document that passes muster with your regulator—but in my experience effective organizations do much more than this.

Far more than a perfunctory regulatory expectation, an effective strategic plan ensures continuity between the board and the management team on key matters of setting strategic goals, the process by which progress will be measured, the talent needed to achieve the goals, the challenges the organization currently faces, and planning for contingencies (or known unknowns). Done right, a good strategic plan is the backbone around which an organization can evaluate managerial effectiveness, design compensation structure, orchestrate team building and hiring decisions, ensure infrastructure is in place well in advance of each phase of growth, execute on plans to enter or exit lines of business, and position itself to take advantage of unexpected opportunities and challenges.

Having a common mindset on these matters will enhance organizational effectiveness and avoid crippling delay when presented with new and unexpected developments. As a regulator during the financial crisis, I was amazed that, in the stretch of a single morning’s phone conversations, I would visit with executives in both severely crippled organizations as well as strong banks methodically plotting how to seize on the opportunities presented by the downturn to expand, grow and strengthen their companies. One group was in harm’s way and the other was positioned to succeed. Often, the difference came down to planning, or the lack thereof.

Another benefit of planning is to position the organization for the future. A well developed strategy along with a track record of delivering on strategic promises can position an organization nicely for more advanced stages of growth. A community bank considering institutional investors, in anticipation of well thought out expansion or a public stock offering, for example, will benefit from a disciplined and thoughtful planning process. The track record presents a benchmark against which investors can evaluate management and board performance. The bank can anticipate questions investors may ask when a robust and performance-based discussion is already part of the bank’s internal dialogue.

Finally, a strategic plan can help the bank avoid foreseeable bad outcomes. Strategic plans don’t protect the bank from all harm. But the planning process can identify employees, customers, or lines of business out of step with the organization’s carefully considered tolerances for risk. It can help companies avoid needless and unproductive spats with regulators (over the failure to plan, for example) and tense conversations with restless investors, whose first question is often: What is the plan? Good execution can establish a track record which will serve the organization well in considering mergers or acquisitions — and it can drive greater value when it comes time to sell.

Clear–eyed and realistic self-assessment, plus robust planning and benchmarking, should be elevated to a much higher prominence in the company than a simple checked box on a regulatory form. Done right, it can result in an enhanced and more disciplined corporate culture, ensuring the organization is positioned to grow responsibly and drive shareholder value.