Many managers practice strategic planning because it offers a clear vision and direction for their department. It’s necessary because, without it, you are driving in the dark with no lights. You’ll get to your destination, maybe, but it will be difficult and take a lot of effort and concentration.
So why should strategic planning be on your list of priorities?
Strategic planning serves a variety of purposes. Here are some of them:
1. It clearly defines the purpose of your business and establishes goals and objectives consistent with that purpose within a stated time frame
2. It allows you to communicate those goals and objectives to the stakeholders.
3. It helps you develop a sense of ownership of the plan.
4. You get the most effective use of your resources by focusing them on the key priorities.
5. You provide a base for measurable progress and establish a process for change when needed.
6. You can listen to everyone’s opinions and build a natural journey towards success for your department
7. You provide a clearer focus for your department, producing more efficiency and effectiveness.
8. It creates a link in working practices between the team and higher management.
9. It develops cohesion between all team members.
10. Everyone sings the same vision statement from the same song-sheet.
11. It increases productivity because of effective goal channeling.
12. It helps solve most major directional inefficiencies in the business.
So there’s many reasons why strategic planning helps you in the short and long-run.
Here’s what you should consider when you are making the strategy:
Mission and Objectives
This is your business vision, including your values and purposes and visionary goals that drive you forward.
You can then perform an industry analysis using a framework like Michael Porter’s five forces.
Then you can match your strengths to the opportunities identified in Porter’s analysis, while addressing its weaknesses and external threats.
To get greater profitability, you seek to develop a competitive advantage. This can be based on cost or differentiation. Michael Porter identified three industry-independent generic strategies from which the firm can choose.
The strategy is then implemented through a series programs, budgets, and procedures. You need to look at your resources and motivation of staff to achieve your objectives.
Evaluation & Control
When you put the strategy into operation it must be monitored and adjustments made as needed.
Take these steps when you evaluate and control:
1. Define parameters to be measured
2. Define target values for those parameters
3. Perform measurements
4. Compare measured results to the pre-defined standard
5. Make necessary changes
When all these have been done satisfactorily, you are well on your way to achieving the goals of strategic planning, and giving yourself and your team the opportunities to achieve the objectives you have aimed for.
Originally published: 23 September, 2010