Strategic planning in business is a systematic process where the desired future is envisioned and transferring that mission and vision into a defined goal by the sequence of strategic steps taken by organizational leaders.
If we talk about strategic planning in business that means developing marketing strategies and plans in the target market. It helps in identifying the promotional opportunities and their proper evaluation.
When it comes to starting up and small organizations strategic planning becomes equally important so as to determine the long-term goals of an enterprise and adoption of course of action and allocation of resources we need step by step procedure.
Characteristics of strategic planning in business-
- Result & analysis-oriented
- Wide scope of new opportunities
- Top managers to external environment most important determinates of strategy in an organization.
- Proactive behavior
- Product-market variables.
- Dealing with future goals.
To minimize possibilities of risk or threats it is believed that in a model of strategic planning decision making of managers is in the interest of the organization and their time and ability to gather information will turn useful by a rational model of decision making.
Strategic planning in business- Thought process and strategy to accomplish that thought.
While if we talk about strategy it means setting goals, achieving those goals, mobilizing resources to execute the actions. The strategy describes how the end will be achieved. It has inputs, activities, outputs, and outcomes.
Input- Means data is gathered from a variety of sources such as primary or secondary research. Inputs are gathered to help support and understanding of the competitive environment.
Activities- This includes meetings and other communication among the organizational leaders and to develop a common understanding regarding the competitive environment. Organizational leaders may have a series of questions that they want to be answered in formulating the strategy and gathering inputs.
Outputs- Documentation and communication describing the organization’s strategy and how it should be implemented. A strategic plan may cover multiple years and be updated periodically.
Outcomes- Strategy implementation or execution of the strategic plan produces outcomes. These outcomes differ from strategic goals. For the true learning process, one must need to understand all the aspects.
Tools for strategic planning in business –
SWOT Analysis– This addresses internal strengths and weaknesses in comparison to external opportunities & threats.
Responsive Evaluation- A constructive evaluation approach to identify the outcomes of objectives, this will, later on, support future strategic planning support.
Growth share matrix-portfolio decision about business to retain or divest.
PEST Analysis – It covers the external environment elements such as political, social, economic, technological, etc
Scenario Planning- Majorly used in the military and now used by large corporations to analyze future scenarios.
Balanced scorecards- Strategy cards creates a systematic framework for measuring and controlling strategy.
Strategic planning in business vs strategic thinking-
Rather than paying sharp attention to analytical aspects of strategy making, creative aspects of strategy making should be focused on, which results in the better accomplishment of set goals. If we talk about planning and thinking there is a myth that people generally have a misconception about, strategic thinking and planning are two different concepts. The outcome of strategic thinking is the set goal i.e, blueprint of the whole plan of action and then comes the important part of strategic planning in business and execution.
What are the attributes of a good planning framework?
There are many different frameworks and methodologies for strategic planning in business and management, while there are no rules regarding the right framework most follow a simple pattern and have common attributes. Many variations cycle through.
- Assessment or analysis.
- Strategy formulation.
- Strategy execution.
- Evaluation or sustainment.