Strategic Planning
Strategic planning entails decision-making about an organization’s goals together with the formulation and realization of tactics concerning the allotment of resources meant to support expected achievements. Basically, strategic planning is a vibrant and intricate process involving deliberation of interior and exterior factors. The process also involves deliberations for the short and long term goals. The efficacy of an organization’s strategic management can seriously impact upon its feasibility and there are a lot of reasons why the strategic management process may fall short. Such reasons include failure to think imaginatively concerning the likely affects of poor strategies. In addition, the reasons may be failure to obtain external or internal contributions and dedication as well as failure to synchronize and direct resources.
In the 1960’s and the 1970’s, strategic planning was seen by executives as the best way to enhance productivity and gains. The executives made assumptions that the possible resources needed in the planning process could be estimated. In addition, the executives assumed that subjecting the estimates to different data analysis models, they would be able to gauge the most outstanding strategies. Meanwhile, Strategic thinking is a specific way of solving strategic problems at the personal and institutional point. It also involves combining balanced and generative consideration processes. Depending on the current situation facing an organization, the different thoughts and ideas brought forward in the strategic planning process can be integrated into a successful accomplishment (Eccles, 1993).
Contrast between Traditional and Modern Approaches to Strategic Planning
Traditional strategic planning is an expression for a range of forms of strategic forecasts from the second semi of the 20th Century. This form of strategic planning entailed planning, directing, organizing, and controlling of organization’s strategy. As far as modern strategic planning is concerned, it is a classy strategic process of intended action pact with bountiful background with a place for both the actions of strategic thinking and strategic planning. Eccles (1993) observed the following differences between traditional and modern strategic planning as pertains to the roles of internal and external stakeholders:
Board of Directors
Traditionally, the role of directors has been to query strategies suggested by the skilled managers. The managers were expected to ensure that the thoughts and potential strategic directions of the business are officially acknowledged in the strategic plan. In addition, it was expected of them to communicate the contents of the plan to the rest of the organization. This meant that the realization of the plan was handed over to the professional managers for execution.
The board was conventionally expected to participate in important audit tasks (Bosch, 1995). Inside an organization that has developed strategic procedures, all directors are obligated to think strategically about the organization and not simply in their area of expertise. The panel continues to be responsible for the positioning of the Chief Executive Officer with greater weight on an individual who can reason strategically. Usually, this position is given to an individual who can exercise authority in execution of the plans in the right way and train others to do the same.
Chief Executive Officer
Traditionally, the CEO had been recognized as the top strategic boss in the organization and was responsible for strategy preparation. In such a setting, the chief executive was accustomed to “top-down” type of information flow which is rather uncommon today. Under such a setting, the line managers are only included in the strategic plan only as plan executioners but not planners (Wilson, 1994). Today, strategic planning roles have changed and different people play different roles towards the final plan. For instance the Chief Executives Officer plays the role of a planner-in-charge (Lorange, 1998). While at this position, the chief executive ensures that information flows effectively both horizontally and vertically. This ensures that every person is involved and the final strategic plan is always well deliberated (Liedtka, 1998).
Strategic Planners
From a Traditional point of view, strategic planners in a company were considered to be protectors and harmonizers of the strategic process. The planners used to work within the strategic process centering on a coherent function of the tools and methods of strategy with the line managers barred from the process (Mintzberg, 1994). There is more limberness in the responsibility of the planner who is currently seen as more of a controller or facilitator with a larger collective interactive task in the organization than just a schemer (Bonn and Christodolou, 1996).
According to Mintzberg (1994), a planner in an organization is expected to facilitate all planning thoughts that come from all individuals in the team. This facilitation goes along way into helping the managers get the best work-out plans for the institution. In addition the planners have an imperative task in enterprising examination of strategic issues, evaluating the monetary basis as well as the operational features of some chaotic strategic ideas.
Strategic planners are also responsible for giving guidance when a certain solution has to be sought. They do this by ensuring that they gather all the necessary information from all the stakeholders after which they present the best choice or plan of action to be taken by an organization (Mintzberg, 1994).
Line Managers
From a traditional approach, line managers were barred from strategic planning formulation. In a more modern approach, there is a stronger gratitude that all employees can think tactically with line managers dynamically in quest of independence and task in their jobs. Currently, line managers are expected to collect market inclination and customer related data from the field and relay the same to the senior management. Usually, a copy of the same data is sent to the organization planners to facilitate strategic planning. This data is usually used by the organization’s planners to propel the expected achievements both in the short and in the long term in terms of strategic decisions.
External Consultants
External management consultants have traditionally led the expansion of the strategy prototype and they had modest interaction with the line managers. Exterenal consultants were at times looked down upon ans were not much appreciated in strategic decision making. In the modern strategic approach, there is more participation of line managers as well as the external consultants in the scheme and hence a stronger appreciation of the clients capability to change the whole strategy in order to meet their needs (Delany, 1995). Today, external consultancy has been scaled up to what is now commonly referred to as Business Process Outsourcing (BPO). In such a scenario, more external experts are involved in the strategic decision making process in an organization.
Social Responsibility
Social responsibility is also referred to as Business Responsibility, Corporate Responsibility, Business Citizenship or Community Relations. Social responsibility largely represents the link between a corporation and the wider society in which the corporation operates. It is acknowledgment on the part of the commerce that ‘for profit’ entities do not live in a void, and that a large part of any accomplishments they enjoy is as a direct consequence of the environment in which the entity operates (Samson and Daft, 2002). The social and the environmental surrounding that a company operates in can determine the level that the company may succeed in some cases. It is very important for an organization to give back to the society in which it operates as a sign of appreciation and good will.
Activists of social responsibility broadly consider that the purpose of any economic system should be to further the general social welfare. In advanced economies, the purpose of business should expand further than the maximization of competence and yield. Increasingly, the public expects businesses to have a responsibility to the society in which they are situated, to the populace they employ, their clientel and investors concerns.
In most cases, businesses draw their most important resource, its employees, largely from the local community. Social responsibility advocates or points out that no organization exists in isolation. Actually, modern strategic planning is more likely to encourage social responsibility. This modern approach uses the planning process to build flexibility and adaptiveness. Social responsibility is good business sense and a modern approach to doing business in a globalizing world where companies are increasingly relying on brand strength (particularly global lifestyle brands) to add value and product differentiation.
Key steps on the road to integrating social responsibility within all aspects of operations includes ensuring the commitment of top management, mainly that of the CEO, is communicated to the entire organization. The process should also involve appointing a social responsibility position at the strategic decision-making level to manage the development of policy and its implementation. Lastly, the company should develop relationships with all stakeholder groups (particulary the relevant NGOs) to incorporate a social audit within the company’s yearly account.
This audit would be used to ensure that the compensation system within the organization reinforces the social responsibility policies that have been shaped (Samson and Daft, 2002). Corporations today are best positioned when they reveal the values of their continually changing and responsive market environment in which they run. It is vital that the organizations be able to meet the needs of an increasingly challenging and socially-aware consumer market.
Conclusion
The strategic approach that was formerly in use as described by Ansoff (1965) has over time changed by a significant extent. The different elements of strategic planning have therefore changed to present what we currently have in a more refined way. For instance, the different parts and roles that different members and stakeholders in an organization played have changed. Currently, the planners, the mangers and also the chief executives have had to adjust to new roles as presented or dictated by the current structure. External consultants are now far more alerted on accomplishment issues than they have been in the ancient times.
Social responsibility as a strategy is becoming increasingly important for businesses today because of the trends that are easily identifiable. Recent trends in social responsibility have shown change in social expectations. This sense has increased in the light of latest corporate indignity which has reduced public certainty in the ability of controller bodies and organizations to control corporate glut. However, there are certain modern approaches to planning that can be used to encourage social corporate responsibility in organizations.
The sourcing of the chief executive as a chief planner rather than a top strategic boss is one of the approaches that can help in increasing social responsibility in an organization. When a chief executive becomes part of the planning team, it becomes easier to incorporate social responsibility in the organization’s plans compared to a situation where the chief executive acts as the strategic boss. The active participation of chief executives in all areas affecting the operations of a company, including external factors such as the community, becomes a prerequisite for enhancing social responsibility.
References
Ansoff, H. (1965). Corporate Strategy, New York: McGraw-Hill.
Bonn, I., & Christodolou, C. (1996). From Strategic Planning to Strategic Management. Journal of Long Range Planning, 29(4): 543-551.
Bosch, H. (1995). The Director at Risk: Accountability in the Boardroom. South Melbourne: Pitman Publishing.
Delany, E. (1995). Strategy Consultants-Do they Add Value? Journal of Long Range Planning, 28(6): 99-106.
Eccles, T. (1993). Strategic Thinking: Leadership and Management of Change, West Sussex, England: John Wiley and Sons.
Liedtka, J. (1998). Strategic Thinking: Can it be Taught? Journal of Long Range Planning, 31(1): 120-129.
Lorange, P. (1998). Strategy implementation: the new realities. Journal of Long Range Planning, 31(l): 18-29.
Mintzberg, H. (1978). Patterns in strategy formation. Journal of Management Science, 24(9): 934-938.
Samson, D., & Daft, L. R. (2002). Management (3rd ed.). Singapore: Asia Pacific Publishers.
Wilson, I. (1994), Strategic Planning isn’t dead–It changed. Journal of Long Range Planning, 27(4): 12-24.