Abstract
The contemporary business landscape is increasingly becoming dynamic and complex. Changing consumer preferences, emerging technology, and increasing competition make it imperative for companies to reassess existing processes, systems, and structures. Strategic planning creates a map for a company to align organizational activities to achieve set objectives and goals through strategic formulation and implementation. Adopting strategic planning increases a company’s competitive advantage, brand value, operational efficiency, and productivity, plus minimizes risks. Managers can ensure sustainable success by strategically planning the future of their business. Therefore, senior leaders need to realize the significance of strategic planning and the actions to take for that planning.
Strategic planning is necessary for a company’s success regardless of whether it is a for-profit or nonprofit organization. Bryson (2018) explained strategic planning as the process of creating, implementing, and evaluating specific business strategies. Through a successfully implemented strategic plan, a company can improve performance effectively and efficiently to reach its objectives, mission, and goals. Additionally, it provides growth opportunities and ensures accountability (Byron, 2018). Therefore, the paper focuses on strategic planning and is divided into two sections. The first section covers the definition, functions, purpose, and impact of strategic planning, including the ABCs of strategic planning. Section two provides a synthesis of an article covering the steps to successful strategic planning.
Section 1
The contemporary marketplace has become increasingly complex, dynamic, and uncertain. For example, the world economy faces numerous trends, such as the dramatic shift in customer preferences, e-commerce, and declining social capital. Bryson (2018) asserted that organizations could track progress toward sustainable growth through strategic planning. Strategic planning essentially implies a disciplined effort toward fundamental actions or decisions shaping and guiding every facet of an organization (Bryson, 2018; Rana et al., 2017). Thus, strategic planning requires effective and broad-scale information gathering for organizations to keep pace with changing market trends and remain competitive. A strategic plan offers a foundation through which companies can establish realistic and achievable goals. Adopting a strategic plan further increases profitability and market share (AlQershi, 2021; Rana et al., 2017).
For example, a company can get valuable insights into consumer segments and trends that potentially affect its success. A well-strategized and targeted approach increases operational efficiency, productivity, minimizes risks, and gives companies a sense of direction. Therefore, companies should incorporate strategic planning within operations to achieve organizational goals and sustainable growth.
While strategic planning is central to the growth and health of an organization, certain aspects must be taken into consideration: the ABCs of strategic planning. According to Bryson (2018), A answers the company’s current position, structure, systems, processes, programs, services, mission, and mandates. The content of B focuses on the organization’s projections largely influenced by the company’s vision, mission, and goals (Bryson, 2018).
On the other hand, C answers how a company can achieve desired outcomes through hiring and training, restructuring, rebuilding, or through budget allocations (Bryson, 2018). Thus, the interconnections of A, B, and C show strategic planning as a set of procedures and concepts. Despite the benefits, strategic planning is particularly inappropriate for small entities because of associated costs. Organizations that invest resources in strategic planning often miss out on long-term benefits when they consider the planning as quick, easy, and complete after the generation of a written strategic plan.
Section 2
Strategic planning positions a company for success and aligns leaders and managers to a common goal. Riboldi (2019) outlined the steps to creating a successful strategic plan. The initial step entails assessing the industry, market trends, and competitors. Conducting an external assessment provides tangible insight and valid information to make informed decisions before the strategic planning process. Next, an internal organizational review will set a baseline for organizational capabilities and culture (Riboldi, 2019). Conducting a SWOT analysis will identify the organization’s strengths, weaknesses, opportunities, and threats.
Leaders or senior management must be agile to adapt the strategy to capitalize on strengths and opportunities while offsetting potential threats. In conjunction with an internal and external assessment, a review of organizational mission and vision is critical in inspiring leaders to embrace strategic planning toward achieving meaningful goals (Riboldi, 2019). Strategic planning involves ideation and analysis, which ultimately lead to critical decision-making. Therefore, corporate leaders must be rigorous in communicating the plan through the company’s mission and vision.
Furthermore, the strategic plan must align and delivers on organizational goals. Thus, defining functional objectives and specific initiatives that activate the plan is important (Riboldi, 2019). Objectives should be measurable, distinct, and align with the company’s mission. Nonetheless, resources, champions, and sponsors help operationalize the strategic plan. Riboldi (2019) stated that the primary sponsors of the plan are senior leaders who further manage the budget and staff needs. Subsequently, the leaders must track progress regularly to make necessary changes, which includes reviewing and revising the plan. Tracking progress allows a company to reevaluate priorities based on past successes and failures. The steps will ensure that an organization remains on the right track to ensure the success of its strategic planning. Additionally, repeating each step is an effort toward maintaining a long-term perspective and making measurable progress toward achieving organizational goals and vision.
References
AlQershi, N. (2021). Strategic thinking, strategic planning, strategic innovation and the performance of SMEs: The mediating role of human capital. Management Science Letters, 11(3), 1003-1012. Web.
Bryson, J. M. (2018). Strategic planning for public and nonprofit organizations: A guide to strengthening and sustaining organizational achievement. John Wiley & Sons.
Rana, R. A., Rana, F. Z., & Rana, H. A. (2017). Strategic planning role in nonprofit organizations. Journal for Studies in Management and Planning, 3(6), 166-170.
Riboldi, J. (2019). The seven keys to successful strategic planning. Forbes. Web.