Strategic Planning

• Strategic planning - is developing detailed business strategies, putting them into practice, and analyzing the outcomes of a company’s long-term goals. It is a theory that emphasizes combining a business’s marketing, financial, and human resources departments to meet its strategic goals.
• The goal of strategic management is to maintain a competitive advantage over rivals and take control of the market as a whole. Further, it evaluates, guides, and changes the strategy per the business climate progressions. Strategic management assists in creating a strategic vision, establishing goals, establishing direction, and creating and implementing strategies that align with the organization’s goals to evaluate the organization’s internal and external business environment.
• Strategic Planning - is a future-oriented activity which tends to determine the organizational strategy used to set priorities.
• Strategic Planning - stresses on making optimal strategic decisions.
• Strategic Planning - is a management by plans.
• Strategic Planning - is an analytical process.
• Strategic Planning - Identifying actions to be taken.
• Strategic Management - implies a bundle of decisions or moves taken in relation to the formulation and execution of strategies to achieve organizational goals.
• Strategic Management - stresses on producing strategic results, new markets, new products, new technologies etc.
• Strategic Management - is a management by results.
• Strategic Management - action-oriented process.
• Strategic Management - identifying actions to be taken, the individuals who will perform the actions, the right time to perform action, the way to perform the action.
• Strategic planning - calls for in-depth planning and foresight on an organization’s upper-level management. Before choosing a course of action and planning how to carry it out, executives may consider several alternatives. In the end, a company’s management will hopefully settle on a strategy that can be implemented cost-effectively with a high possibility of success and avoid undue financial risk. Positive outcomes are often thought of as improving the business’s bottom line.
• Strategic planning is regarded to be established and carried out in three (3) important steps:

  Strategy Formulation

  Strategy Implementation

  Strategy Evaluation
• Strategy Formulation (Determination of strategic objectives) - Key objectives can be extracted from the mission and vision statements of the enterprise. From here, strategic objectives can be made.
• Strategic objectives - refer to the specific performance targets the business wants to accomplish. These objectives define how the enterprise’s mission will be met.
• Strategy Implementation (Adoption or use of strategic course of action) Following the formulation of a strategy, the business must allocate resources for its implementation and establish specific targets or goals related to its implementation. How well upper management communicates the chosen strategy throughout the company and gets all employees to commit the desire to put the strategy into action determines the success of the implementation stage.
• Strategy Implementation (Adoption or use of strategic course of action) - The construction of a solid structure, or framework, to implement the strategy, optimize appropriate resource usage, and reorient marketing activities following the strategy’s aims and objectives are all critical components of successful strategy implementation.

   
• Resources come in different forms. Money and even labor are precious resources that can be used. However, without a sound strategy, these can go to waste, so it is imperative to the enterprise how and how much they should allocate resources based on the various activities required to achieve the objectives.
• Strategy Evaluation (Evaluation of the performance of the chosen strategy) Any experienced entrepreneur is aware that success today does not guarantee success in the future. As a result, managers must evaluate a strategy’s performance following its implementation phase.

  Three (3) essential steps are involved in strategy evaluation:

  ·        Evaluating performance.

  ·        Evaluating     the     internal     and     external     factors     that     influence     the strategy’s implementation.

  ·        Adjusting the strategy’s effectiveness.
• Each of the three (3) important steps is placed inside three (3) progressive levels: operational, middle management, and senior management levels. Therefore, to assist the business in functioning as a more efficient and effective team, it is vital to encourage communication and interaction between managers and employees at all levels.
• Strategic planning - is crucial to the enterprise’s long-term success. It gives a sense of direction to the business and is essential in making decisions. Many established entrepreneurs and technopreneurs treat strategic planning like a blueprint of an architectural building. There is no best or great model, and the usage of such plans depends on how an enterprise will achieve its goal. Below are the basic strategic planning models being used by enterprises (Business Benefits Group, n.d.).
• 1.      Basic Strategic Planning Model – usually consists of creating a mission statement detailing the enterprise’s existence. The business then will figure out its intermediate goals, referring to what needs to be done to accomplish its mission.

  Best for:

  ·        Small businesses or organizations

  ·        Companies with little to no strategic planning experience

  ·        Organizations with few resources
• Goal-based Strategic Planning Model


  1. Use SWOT analysis

  2. Identify goals and issues to prioritize objectives

  3. Formulate mission statement and action plans

  4. Create strategic plan

  5. Develop operational plan

  6. Formalize budget for first year
• Goal-based Strategic Planning Model


  • Designed for more established businesses and enterprises
• Best for

  • Organizations with basic strategic planning experience
  • Businesses that are looking for a more comprehensive plan
• • 3.      Scenario Strategic Planning Model This makes use of a PESTEL analysis. This model can be used by an enterprise that wants to beef up and prepare for different scenarios, such as changes in the economy, trends in society, new laws, and other external forces that can alter how it does business. The enterprise can list the most common problems that could affect their business over the next three (3) to five (5) years and create responses on how to resolve them.

  Best for:

  ·        Organizations trying to identify strategic issues and goals caused by external factors

   
• 4. Alignment Strategic Planning Model This model creates alignment between a business’s resources and mission. It helps fine-tune the enterprise’s objectives or learn why its goals are not being achieved as planned. This model starts by determining the business’ resources, mission, programs, and required support.
• 4.    Alignment Strategic Planning Model - After this, it is important to know what areas in the business are working well and which ones need further adjustment to reach the desired effect. Lastly, the business needs to include adjustments as strategies in the plan.

  Best for:

  ·        Organizations that need to fine-tune their strategies

  ·        Businesses that want to uncover issues that prevent them from aligning with their mission

  ·        Companies that wish to reassess objectives or correct problem areas that prevent them from growing
• • 5.      Organic Strategic Planning Model This model requires continual reference to common values and shared reflection around current processes. Organic planning often uses a technique known as storyboarding to let participants create their ideas before sharing them with a larger group.
• 5.      Organic Strategic Planning Model - In this type of planning, brainstorming is imperative to pinpoint the needs of the enterprise and target the issues that need addressing.

  Best for:

  ·        Large organizations that can afford to take their time

  ·        Businesses that prefer a more naturalistic, organic planning approach that revolves around common values, communication, and shared reflection

  Companies that have a clear understanding of their vision
• • 6.      Real-time Strategic Planning Model The real-time strategy planning approach is even more adaptable than the organic model. It aids in presenting an organization’s vision, values, and mission. Lists are frequently presented to board members or management for further discussion during real-time strategic planning.

  Best for:

  ·        Companies that need to react quickly to changing environments

  ·        Businesses that are seeking new tools to help them align with their organizational strategy
• • 7.      Inspirational Strategic Planning Model This quick strategy starts with creating a very inspiring vision for the organization and the goals that go along with it. This model is better for more established businesses than the basic model.

  Best for:

  ·        Businesses with a dynamic and inspired start-up culture

  ·        Organizations looking for inspiration to reinvigorate the creative process

  ·        Companies looking for quick solutions and strategy shifts
• ·        Entrepreneurial mode. It states that one powerful individual makes strategy. This mode focuses on opportunities and growth, not business problems. Strategy is guided by the founder’s vision of direction and is exemplified by significant, bold decisions. The dominant goal of this mode is the growth of a corporation.

  Example:

  Amazon.com, founded by Jeff Bezos, reflects Bezos’ vision of using the Internet for marketing everything that can be bought.
• ·        Adaptive mode. It is characterized by reactive solutions to existing problems rather than a proactive search for new opportunities. Strategy is fragmented and is developed to move a corporation forward incrementally. This mode lacks clarity and consensus on strategic goals and is only appropriate for dealing with complex and changing environments.

  Example:

  Due to the Covid-19 pandemic lockdown, movie theaters worldwide were temporarily shut down.
• Planning mode


  1. Gather appropriate information for situation analysis

  2. Generate feasible alternative strategies

  3. Rationally select the most appropriate strategy

  4. Proactive search for new opportunities

  5. Reactive solution to existing problems
• Samsung


  • After carefully studying trends in the mobile and communication industries, the company noted it needed to rebrand itself from being an appliance manufacturer to a customer-focused and highly reliable information technology infrastructure and electronic commerce service
  • By late 2000, the company had launched several phones, leading to global success
• ·        Logical Incrementalism. In this mode, top management first develops a reasonably clear idea of the corporation’s mission and objectives. It is a fusion of strategy formulation and implementation. This approach appears useful when the environment is changing rapidly, when it is building consensus, and when resources must be developed before committing the entire organization to a specific strategy.

  Example:

  In the petroleum industry, corporate headquarters established the mission and objectives but allowed the business units to propose strategies to achieve them.
• 1.      Evaluate current performance results.

  The organizational performance must be assessed based on return on investment, profitability, current mission, objectives, strategies, and policies.
• 2.      Review corporate governance.

  The organization must evaluate the performance of its board of directors and top management.