Strategic Planning: Five Priorities
Strategic planning is a management tool.
It is used to help an organisation clarify its future direction – to focus its energy and to help members of the organisation work toward the same goals.
How to Get Your Strategic Planning Right
Strategic planning is a valuable process that helps leaders to define a clear path in response to changing business conditions. Let’s look at the purpose and benefits of strategic planning, and how to deploy it for maximum success.
What is Strategic Planning?
Strategic planning is a key management tool for defining your organisation’s overall objectives and the key strategies for achieving them.
At the end of the strategic planning process, you should arrive at a clear understanding of where the organisation is headed, and the sequence of actions it must take to get there. You will also understand when these actions need to be undertaken, and how they will be carried out.
What Are the Benefits?
Your organisation will see benefits from strategic planning almost immediately, most notably the definitive purpose and direction it provides for the entire organisation.
Strategic planning also makes decision-making a lot easier as everything the organisation does should be in support of the plan. In this regard, strategic planning also defines accountability for who will deliver specific aspects of the management strategy.
Ultimately, strategic planning provides the ‘footprints for success’ that focus the efforts of employees, and ensure the entire organisation is moving in the same direction.
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How Should I Approach Strategic Planning?
Strategic planning is an organisation-wide initiative that will impact your core business and its many support functions. Therefore, the initiative must be carried out methodically, involving stakeholders from all departments within the organisation.
Strategic planning will also raise many questions about the organisation’s existing position and its potential future. This is an exercise in gathering information and opinions, testing assumptions and undertaking trend analysis.
Discipline is another prerequisite for strategic planning because it requires laser-like precision to create an effective plan that will drive your organisation through its next period of change and growth.
Every organisation must decide how much time to devote to strategic planning. However, the benefits can far outweigh the time-consuming and sometimes painful nature of the process itself.
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Before you Begin
Timing is critical as certain elements need to be in place to ensure the strategic planning process is as effective as possible.
Most notably, you need to gain senior leadership buy-in, and a commitment to field the necessary budget and resources for the process.
Having the right mindset is essential. You must be willing to think outside the box so you can consider new approaches to evaluating your organisation and its activities.
You must also be open to discovering insights about your organisation, no matter how negative they may be. It can even help to hire an external consultant who will be able to look at your organisation objectively.
Gather your Strategic Planning Team
The first step is to build a strong strategic planning committee and define everything you need to make the process successful.
Appoint the members of your team and nominate a leader. You will need to clarify every member’s role within the team so their efforts are not duplicated or key activities omitted.
Next, you need to identify key stakeholders throughout the organisation who will be called on to provide information and support to the strategic planning process. You can also consider any external resources or additional research that will help you achieve a satisfactory result.
Begin at the End
To plan a route, you must first have a destination, so think about the future of your organisation five years from now. It helps to ask a broad spread of questions, such as:
- What is your ideal vision for the organisation?
- What new products or services might be needed?
- How will customer expectations change, and how will you surpass them?
- Where do you want to be in relation to your competitors?
- What will the world look like generally, and how will your organisation adapt?
These are just a few sample questions, but don’t stop there. Think as broadly as possible about your organisation and what you want to achieve.
Create a Core Strategy Statement
Your core strategy statement is a short paragraph that defines your strategic planning objectives in understandable and measurable terms.
The statement should communicate the essence of the organisation’s mission, and convey its character and culture. Your core strategy statement should include:
- Purpose: What customer needs will you serve?
- Objectives: What will you set out to accomplish, including financial objectives?
- Business: What activities will achieve your objectives?
- Values: What principles or beliefs will guide your employees?
- Expectations: What do you expect the future to hold and how will you capitalise on it?
Where are you Now?
Once you understand where your organisation would like to be, it’s time to look at where it is now. A SWOT analysis is one of the best tools for this part of the strategic planning process as the information you gather will help to shape the strategies you use to achieve your objectives.
Standing for strengths, weaknesses, opportunities and threats, the aim of this exercise is to identify the most important issues relating to the organisation’s objectives. This includes any critical constraints that could limit the scope of your achievements.
Strengths and opportunities will become guiding lights for your organisation, and your strategies must fully capitalise on what they offer.
Your strategies must also consider weaknesses and threats, which could include a variety of concerns such as funding issues, changing regulations or evolving competitor offerings.
Guide your SWOT analysis by asking key questions such as:
- What are your core competencies?
- What do you tend to struggle at?
- What emerging technology and ideas might disrupt the market?
- What are your competitors doing?
You should also ask a broad spread of ‘what ifs’, such as:
- What if some of your competitors were to merge?
- What events might impede business continuity (e.g. geopolitical instability)?
- What if certain star players of your organisation were to leave?
Carry out Department Activities
With the wealth of information you have gathered by this point of the strategic planning process, you can begin to develop department-specific activities that will enable you to achieve your overall vision.
These sub-objectives and strategies will come from individual inspiration, group discussion and formal decision-making techniques. However, make sure your senior leadership team agrees with all decisions that are being made.
As you undertake departmental activities, you are likely to uncover new insights that change the nature of your overall objectives and the way you achieve them. Try to adapt your planning process to this new information as it could alleviate further risk and deliver even greater success in the long term.
Finalise the Strategic Plan
The final stage of strategic planning is documenting all outcomes of the process, including the core management strategy statement, the results of your SWOT analysis, and the agreed strategies.
It is advisable to use a planning consultant to draft the strategic plan to ensure it contains all necessary components and is formatted for optimal success. At the end of the process, this document will be submitted for final review by all key stakeholders.
Beyond Strategic Planning
Once approved, the next step is for department heads to develop individual business plans that support the achievement of the overall strategic plan.
Bear in mind that the strategic plan is not a guarantee of success. It can only serve to support the expertise and sound judgement of your people.
In fact, the true value of strategic planning is often the process itself because it gives you a better understanding of the organisation and helps you to engage employees at all levels. This empowers everyone to be more effective and motivates them toward a clearly defined vision of the future.
This article was originally contributed by Rick Johnson.
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