||It has been suggested that Long range planning be merged into this article. (Discuss) Proposed since June 2012.|
In order to determine the future direction of the organization, it is necessary to understand its current position and the possible avenues through which it can pursue particular courses of action. Generally, strategic planning deals with at least one of three key questions:
- "What do we do?"
- "For whom do we do it?"
- "How do we excel?"
The key components of strategic planning include an understanding of an entity's vision, mission, values and strategies. In the commercial world a vision statement or a mission statement may encapsulate the vision and mission.
- Vision outlines what the organization wants to be, or how it wants the world in which it operates to be (an "idealised" view of the world).
- Mission defines the fundamental purpose of an organization or an enterprise, succinctly describing why it exists and what it does to achieve its vision.
- Values are beliefs that are shared among the stakeholders of an organization.
- Strategy, narrowly defined, means "the art of the general".
Organizations sometimes summarize goals and objectives into a mission statement or a vision statement. Others begin with a vision and mission and use them to formulate goals and objectives. A newly emerging approach is to use a visual strategic plan such as is used within planning approaches based on outcomes theory. When using this approach, the first step is to build a visual outcomes model of the high-level outcomes being sought and all of the steps which it is believed are needed to get to them. The vision and mission are then just the top layers of the visual model.
Tools and approaches
- Balanced Scorecards, which creates a systematic framework for strategic planning;
- Scenario planning, which was originally used in the military and recently used by large corporations to analyze future scenarios.
- PEST analysis (Political, Economic, Social, and Technological)
- EPISTEL (Environment, Political, Informatic, Social, Technological, Economic and Legal).
- ATM Approach (Antecedent Conditions, Target Strategies, Measure Progress and Impact).
There are several factors to assess in the external situation analysis:
- Markets (customers)
- Supplier markets
- Labor markets
- The economy
- The regulatory environment
It is rare to find all seven of these factors having critical importance. It is also uncommon to find that the first two - markets and competition - are not of critical importance.
With regard to market planning specifically, researchers have recommended a series of action steps or guidelines in accordance to which market planners should plan.
- Business strategy mapping
- Chief strategy officer
- Decision making software
- Enterprise planning systems
- Hoshin Kanri
- Integrated business planning
- Military strategy and The Art of War for the origins
- Strategic planning software
- Situational analysis
- Strategy Markup Language (StratML)
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- Friedman, George (2010) . The Next 100 Years: A Forecast for the 21st Century. Black Inc. p. 69. ISBN 9781921825545. Retrieved 2013-08-03. "[...] the Chinese must use their growing economic strength to develop military options against the United States. They will simply be acting in accordance with the fundamental principle of strategic planning: hope for the best, plan for the worst."
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