Strategic planning is a continuous and systematic process where people make decisions about intended future outcomes, how outcomes are to be accomplished, and how success is measured and evaluated. Strategic planning is the method by which a community continuously creates arti-factual systems to serve extraordinary purpose.
What are the basic steps in the strategic planning process?
Steps of the Strategic Planning Process: Therefore, a simple strategic plan can be broken down into five simple steps: 1. Determine where you are and get prepared: It is very important for a business to have a pragmatic approach towards doing business; it should draw a line between how it wants to see itself versus people’s perception about it.
How to write a strategic plan?
Tips for writing a strategic plan
- Get something on paper. In the beginning, try not to worry about your plan making sense. ...
- Write with a small number of people. Whether you are the sole owner or co-owner of your business, be sure to write with a small number of people.
- Present your draft for approval. ...
What is the main purpose of strategic planning?
The purpose of the strategy relies on These three main points:
- Setting goals
- Building action plans
- Mobilize and focus resources to achieve goals
What are the objectives of strategic planning?
- Increase internal revenue over the next three years
- Decrease overhead spending
- Budget additional funds for marketing initiatives
- Increase stockholder shares every year for the next five years
- Reduce waste over the next year
- Create more diverse revenue streams
- Increase market position
- Attract more sales
- Increase investment portfolio
What is the nature of planning?
Planning is a mental work basically concerned with thinking before doing. It is an intellectual process and involves creative thinking and imagination. Wherever planning is done, all activities are orderly undertaken as per plans rather than on the basis of guess work.
What is the nature and purpose strategic planning briefly explain in steps?
Strategic planning is a process in which an organization's leaders define their vision for the future and identify their organization's goals and objectives. The process includes establishing the sequence in which those goals should be realized so that the organization can reach its stated vision.
What are the four natures of planning?
While there are many different types, the four major types of plans include strategic, tactical, operational, and contingency.
What are the nature and types of planning?
Types of PlanningStrategic PlanningOperational PlanningActivity controlledOverall organizational performanceInternal tasks and operationDecision makingMany decisionsFocus on one decisionOrganizational level involvementTop managementMiddle and lower managementBasis of planningJudgmentalExact data & standards6 more rows•Sep 2, 2017
What is the nature of strategic decision?
Strategic decisions involve a change of major kind since an organization operates in ever-changing environment. Strategic decisions are complex in nature. Strategic decisions are at the top most level, are uncertain as they deal with the future, and involve a lot of risk.
What is the main purpose of strategic planning?
The purpose of strategic planning The purpose of strategic planning is to set overall goals for your business and to develop a plan to achieve them. It involves stepping back from your day-to-day operations and asking where your business is headed and what its priorities should be.
What is the nature and scope of planning?
It is the process by which managers establish goals and define the methods by which these goals are to be attained. Planning involves selecting missions and objectives and the actions to achieve them; it requires decision making, which is choosing from among alternative future courses of action – Weihrich and Koontz.
What are the four types of strategic planning?
The 4 Types of PlansOperational Planning. “Operational plans are about how things need to happen,” motivational leadership speaker Mack Story said at LinkedIn. ... Strategic Planning. “Strategic plans are all about why things need to happen,” Story said. ... Tactical Planning. ... Contingency Planning.
What are the types of strategic planning?
Various types of strategic planning in business can be a applied to any industry.Planning. Gareth R. ... SWOT Analysis. SWOT analysis is a common type of strategic planning method in business. ... Five-Forces Model. ... Business Level Strategies. ... Coporate-Level Strategies.
What are the steps of strategic planning process?
5 steps of the strategic planning processDetermine your strategic position.Prioritize your objectives.Develop a strategic plan.Execute and manage your plan.Review and revise the plan.
What are the 7 steps of strategic planning?
7 stages of strategic planningUnderstand the need for a strategic plan. ... Set goals. ... Develop assumptions or premises. ... Research different ways to achieve objectives. ... Choose your plan of action. ... Develop a supporting plan. ... Implement the strategic plan.
What are the five steps in the strategic planning process?
The five stages of the process are goal-setting, analysis, strategy formation, strategy implementation and strategy monitoring.
What is the nature and purpose of long term planning?
It unifies organisational activities and efforts towards the long-term goals. It guides members to become what they want to become and do what they want to do. It focuses on specific goals making it clear for members to know the direction towards which they have to move.
What are the characteristics of strategy?
Strategy-making, as presented by Mintzberg is: 1 derived from synthesis 2 informal and visionary, rather than programmed and formalized 3 relies on divergent thinking, intuition and using the subconscious. This leads to outbursts of creativity as new discoveries are made. 4 is irregular unexpected, ad hoc, instinctive. It upsets stable patterns 5 managers are adaptive information manipulators, opportunists, rather than aloof conductors 6 done in time of instability characterized by discontinuous change 7 results from an approach which takes in broad perspectives and is, therefore, visionary, and involves a variety of actors capable of experimenting and then integrating.
What is Mintzberg's definition of strategic planning?
Mintzberg has long been a critic of formulae and analysis-driven strategic planning. In The Rise and Fall of Strategic Planning, he remorselessly destroys much conventional wisdom and proposes his own interpretations. He defines planning as ‘a formalized system for codifying, elaborating and operationalizing the strategies which companies already ...
What is strategy making?
Strategy-making, as presented by Mintzberg is: derived from synthesis. informal and visionary, rather than programmed and formalized. relies on divergent thinking, intuition and using the subconscious. This leads to outbursts of creativity as new discoveries are made. is irregular unexpected, ad hoc, instinctive.
Who wrote the book Corporate Level Strategy?
Mintzberg’s work brought a spirited response from the defenders of strategy. Andrew Campbell, co-author of Corporate-Level Strategy, wrote: ‘Strategic planing is not futile. Research has shown that some companies – both conglomerates and more focused groups – have strategic planning processes that add real value.’.
When should strategic planning occur?
Strategic planning is not a close-ended exercise : A strategic plan is meant to evolve continually, and strategic thinking can be valuable in a company’s daily activities. Moreover, the stages of implementation and evaluation can keep your team constantly engaged in forward-thinking dialogue.
What are the elements of a strategic plan?
While the format of strategic plans can differ somewhat, most include a few key elements: a vision, mission, goals, and contingency plans for what may lie ahead.
What are the two methods used in strategic planning?
The SWOT and PESTLE methods are two approaches that teams regularly use in preparing for strategic planning. These techniques allow organizations to evaluate where they stand and clarify areas of emphasis for their subsequent strategic plans.
Why do companies revisit their strategic plans?
As mentioned earlier, many companies revisit their strategic plans on a quarterly basis, checking progress toward identified goals. This cadence is valuable in keeping strategic priorities fresh and making adjustments to achieve important benchmarks.
How many phases are there in strategic planning?
The strategic planning process is best understood in terms of four specific phases, each with important constituent elements. The sections below provide detailed guidance on generating, implementing, and evaluating a strategic plan.
How often should a strategic plan be developed?
In this approach, a strategic plan is developed once a year and assessed or updated in each subsequent quarter.
What do you need to analyze your organization?
To analyze your organization’s present, you’ll need data. As much of it as possible, including statistical, anecdotal, and historical information. Experts call these kinds of data “inputs”—information sources that shed light on some dimension of the strategic planning process.
What is strategic planning?
Strategic planning is a continuous process that enables organisations to adapt to the changing, dynamic environment. Co-ordination: It coordinates organisation’s internal environment with the external environment, financial resources with non-financial resources and short-term plans with long- term plans.
How does strategic planning help the organisation?
Optimum utilisation of resources: Strategic planning makes best use of resources to achieve maximum output.
How can the future be predicted?
Future can be predicted through strategic planning. It enables managers to anticipate problems before they arise and solve them before they become worse. Minimise risk: Strategic planning provides information to assess risk and frame strategies to minimise risk and invest in safe business opportunities.
Why should managers be farsighted?
Managers should be farsighted to make strategic planning meaningful. Pervasive process: It is done for all organisations, at all levels; nevertheless, it involves top executives more than middle or lower-level managers since top executives envision the future through scientific techniques of forecasting.
How can a manager overcome the limitations of strategic planning?
These limitations are by and large, conceptual and can be overcome through rational, systematic and scientific planning. Researchers have proved that companies which make strategic plans outperform those which do not do so.
Why is strategic planning important?
Strategic planning makes best use of resources to achieve maximum output. Resources are scarce and strategic planning helps in their use in the areas where they are required most. General Robert E. Wood remarks, “Business is like war in one respect.
Which companies report good financial results as a result of sound strategic planning?
Companies like Reliance, Infosys, Tata, Wipro, Deloitte, etc. are the giants who report good financial results as a result of sound strategic planning. Guide to organisational activities: Strategic planning guides members towards organisational goals. It unifies organisational activities and efforts towards the long-term goals.
What is strategic planning?
Strategic planning is the art of creating specific business strategies, implementing them, and evaluating the results of executing the plan, in regard to a company’s overall long-term goals or desires. It is a concept that focuses on integrating various departments (such as accounting. Accounting Accounting is a term that describes the process ...
Why is strategic planning important?
Strategic planning helps firms prepare proactively and address issues with a more long-term view. They enable a company to initiate influence instead of just responding to situations. Among the primary benefits derived from strategic planning are the following: 1.
How does strategic planning help managers and employees?
It is initiated through participation and dialogue among the managers and employees, which shows their commitment to achieving organizational goals. Strategic planning also helps managers and employees show commitment to the organization’s goals.
Why is it important to decentralize the strategic planning process?
The increased dialogue and communication across all stages of the process strengthens employees’ sense of effectiveness and importance in the company’s overall success. For this reason, it is important for companies to decentralize the strategic planning process by involving lower-level managers and employees throughout the organization. A good example is that of the Walt Disney Co., which dissolved its separate strategic planning department, in favor of assigning the planning roles to individual Disney business divisions.
Why is it important to evaluate the performance of a chosen strategy after the implementation phase?
Any savvy business person knows that success today does not guarantee success tomorrow. As such, it is important for managers to evaluate the performance of a chosen strategy after the implementation phase. Strategy evaluation involves three crucial activities: reviewing the internal and external factors affecting the implementation of the strategy, measuring performance, and taking corrective steps to make the strategy more effective. For example, after implementing a strategy to improve customer service, a company may discover that it needs to adopt a new customer relationship management (CRM) software program in order to attain the desired improvements in customer relations.
What happens after a strategy is formulated?
After a strategy is formulated, the company needs to establish specific targets or goals related to putting the strategy into action, and allocate resources for the strategy’s execution. The success of the implementation stage is often determined by how good a job upper management does in regard to clearly communicating the chosen strategy throughout the company and getting all of its employees to “buy into” the desire to put the strategy into action.
What are the three levels of strategic planning?
All three steps in strategic planning occur within three hierarchical levels: upper management, middle management, and operational levels. Thus, it is imperative to foster communication and interaction among employees and managers at all levels, so as to help the firm to operate as a more functional and effective team.
What is strategic planning?
Strategic planning is the formulation of long term plans for successful running of environmental prospects and threats with regard to a company’s strengths and weaknesses (McNamara 2012). This is inclusive of a venture’s mission, specific objectives, proper strategies, as well as set policy guidelines. In many ways, it is the key step in determining the upcoming direction of a business.
Why is strategic planning important?
Beginning from the mission and the philosophy of a company, down to the choice of businesses and strategies, all the important aspects in the running of a company are organized through strategic planning (McNamara 2012). It is mainly through strategic planning that a company is able to make the right decisions with regard to its mission, objectives, as well as its business interests and market (McNamara 2012). Another reason why strategic planning is vital in any given company is due to the fact that it ensures the optimum utilization of resources.
