“It’s tough,” Andrea admitted. “During the recession, we significantly reduced our workforce. We had to. Our revenues were down 40 percent, now they are up 10 percent. We are hesitant to raise headcount in the face of optimism. How do we make our decisions about how many people we need in which roles?”

“Here’s a rule of thumb,” I replied. “Don’t organize around your previous metrics of headcount. Go back to ground zero and organize around the work. What is your core work? How is it performed? What does it take to create the output for the demand you forecast? Around your core work, what supervision is necessary? And for the future, who is necessary for planning, for contingencies and alternatives?”

Andrea was nodding. “Strip away all the noise and go back to the core?”

“And only create what is necessary.”

Ellen didn’t say a word.

“Have you ever wondered why Vision Statements all sound alike?” I asked.

Ellen was still quiet.

“A Vision Statement is designed to describe a picture of the future, and in most companies, a future that is three, four or five years out. The conversation changes. And we aren’t very good at it.”

Ellen moved her head to think.

“We are very good at describing reality in concrete terms. It’s when we begin to think out, into the future, that we begin to stumble. Most Vision Statements sound alike because we have never sat down to think, conceptually, about the future. The conversation changes from a concrete world to a conceptual world and our words begin to fail us.

“Some give up, saying all this planning is useless. It’s never right, things change, so what’s the point?

“Without change, we can get by, short cutting this exercise without much damage. But, in this time, with so much uncertainty, this conceptual planning becomes critical.”

“Interesting, our conversation switched from tangible decisions to an analogy about cookies,” I observed.

“Not just cookies, warm cookies,” Ellen corrected me. “It’s easy to plan for a project that will be completed in two weeks. We know who the suppliers are, what materials we need to purchase, what contractors have to be involved. But, when things move further into the future, it gets murky. I can pretty much tell you what our revenues will be in 2011, but the real question, is what decisions have to be made this year to position us for 2013-2014?”

“You’re right,” I agreed. “Something changes about the discussion when we look that far out. In the near term, we can identify, with some accuracy, what is most likely to happen. It is a very concrete discussion. But, the further we go into the future, those tangible items get fuzzy. More than fuzzy. Those concrete elements turn into conceptual elements. And it is a completely different conversation.”

“Therein, lies the dilemma,” I nodded.

“Absolutely,” Ellen replied. “And it’s not just the uncertainty about what might happen with this customer or that project. There are larger things going on. There is uncertainty about taxes and markets. My customers don’t want to make commitments to me and I can’t make commitments to my suppliers.”

“So, what are you going to do? How are you going to plan?” I asked.

Ellen was silent, then finally, thoughtfully, spoke, “It’s not so much about making this decision or that decision. It’s about position. How can we put ourselves in a position that keeps our options open? More than contingency planning. Really keeping long-term moves as viable alternatives.”

“Having your cake and eating it, too?”

Ellen laughed. “It’s not a finished cake. It’s having all the ingredients to make a cake, or a pie, or a dozen warm cookies.”

“Why is this so difficult?” I asked. We were diligently poring over our business plan for 2011.

“Part of it, it’s difficult to look at the larger picture when you have your nose down in the dirt,” Ellen replied. “Our work volume is increasing, but we are not committed to increasing our overhead. We don’t trust the market. This is very complex.”

“But, your company is used to dealing with complexity,” I nodded encouragement.

“This is different. Detailed complexity, we can handle. I mean, we have a staff of computer geniuses, who can write code to handle a hundred thousand details. But, this is different. You can’t write a computer program to deal with this complexity.”

“Why not?” I pressed.

“This complexity is not detailed complexity. And that’s why this planning exercise is so difficult,” Ellen shook her head. “This complexity comes from uncertainty. You cannot write a computer program to deal with things you do not know.”