User:Nathy.Bustamante/five stages to a strategic plan
Five Stages to a Strategic Plan
[edit]Introduction
[edit]In order to run a business it is important to have a strategic plan because it looks at all the things the business may need to succeed. In addition, the strategic plan could help to know the things that the human capital is actually good at doing. An appropriate strategic plan also helps business leaders determine where and how to spend the company's resources.[1] The strategic planning process is done to develop a sustainable plan that would lead an organization to accomplish its long-term goals and objectives. The planning process has to be executed by managers at all levels and they need to get together in order to analyze the situations that are or might be affecting the company in all aspects. During the planning process, managers have to look at the current scenario of the organization, its internal and external environment; prepare suitable strategies and objectives according to their situation assessment as well as develop procedures to execute the strategic plan. Normally, strategic planning is done for a three to five years.[2] Finally, developing a strategic plan is a multi-step process and one step builds off of the next one and to begin the planning process the organization needs to have a passion for what they are doing and a clear idea of what they want to achieve.[3]
Importance of strategic planning
[edit]Strategic planning is important in order to predict the future so it is different from other classic business planning because the strategic variety involves vision, mission and outside-of-the-box thinking. Strategic planning describes where you want your company to go, not necessarily how you're going to get there. However, like all other "travel plans," without knowing where you want to go, creating details on how to arrive are meaningless. Strategic planning defines where your company is going and it explains how characteristics of the strategic issue array translate into effective and timely initiation and implementation of strategic change. [4][5]
Benefits of a strategic plan
[edit]The strategic planning has several benefits for an organization such as:
- Predict the possible future: even if not every situation can be foreseen, managers can make decisions and react to changing market conditions with the end in mind.[6]
- Establish a structural organization: With the help of the mission and vision statement, the company can be provided with a base from which progress can be measured for an effective decision making.[6]
- Make correct decisions: with a clear vision and mission statement, it is easier and more practical for managers to know what to do and when in order to achieve the organizations’ goals.[6]
- Create longevity of the business: the world market changes fast and the companies that can not adapt to changes go down so the strategic planning is helpful to see where the company is and if it is going in the right direction.[6]
- It helps to use in an efficient way the resources of the company.[6]
- Strategic plans help identify what an organization is going to become and tells out the stages needed to get there.[3]
Five stages
[edit]Analysis of the current situation of the company
[edit]The first step in order to have a correct and sustainable strategic plan is to do an external and internal audit so that managers will know where the company exactly is because there are sometimes that people sees themselves where they want to be before they see where they actually are, so they fail.[1] With a feedback of the audits, managers will be able to know where the company have been and is now, what successes has the business enjoyed in the past, which challenges did the company face and how did it handle those challenges, so this will help to understand the organization’s current situation. For this stage, the SWOT analysis is very important. [7][8]
Goal setting: Mission & Vision
[edit]After knowing the current status of the company, and having clear the internal and external scenario, the second step to a strategic plan is to develop a mission and vision statement in order to have an organization’s long term direction. Mission statement is the reason for an organization’s existence. It identifies what the organization does, why it does it, and for whom. A mission statement reminds every one the unique purposes promoted and served by the organization. The vision statement describes what and where the organization wants to be and it defines what the company is managed to be.[9] This will help managers to define the expected objectives that clearly state what your organization must achieve to address the priority issues, it will help to move the organization toward that future. [10][11]
Strategy Formulation
[edit]At this stage, it is important to determine what resources the business currently has that can help reach the defined goals and objectives, also Identify any areas of which the business must seek external resources. In addition, the issues facing the company should be prioritized by their importance to the company’s success. Developing a strategic plan isn't a one-day thing. It also has to be something that is affordable to your business and sustainable to your model. That is why meetings and brainstorming are fundamental. Also consulting some experts would be a key step. Your strategic plan formulation gives you a step by step plan of action that will move you systematically to the place you want to be. [12][11]
Strategy Implementation
[edit]Once managers have clear the strategy that the company needs, everyone, at all levels of the company need to be on the same page, even if their opinions differ. Managers should not only form a consensus about the plan, but share a commitment to its execution. The whole team of the organization must leave each planning session with specific and measurable steps. In that way, everyone should feel sure and impatient for action and willing to wait for achievement.[13][14]
Control & Evaluation
[edit]Strategy evaluation and control actions include performance measurements, consistent review of internal and external issues and making corrective actions when necessary. This is the last step to a strategic plan is to control and evaluate the results of the strategy implementation. [12] To ensure the plan performs as designed, you must hold regularly scheduled formal reviews of the process and refine as necessary, strategic leaders examine and assess if the project is moving in the right direction and their planning has been credible.[1][2] Strategic planning is an ongoing activity so this process has to be monitored periodically in order to see if there are any mistakes and to correct them before it becomes a negative aspect to the company.[10][15]
References
[edit]- ^ a b c AILERON (Oct 25, 2011). "Five Steps to a Strategic Plan". Forbes: 1.
- ^ a b FOUNDS FOR NGO's (2017). "5. Stages of Strategic Planning". www3.fundsforngos.org. Retrieved 2017-05-12.
- ^ a b LOTICH, Patricia (May 25, 2016). "The 5 Step Process of Strategic Planning". The Thriving Small Business: 1–3.
- ^ PARRAGLIA, William (2017). "Why Is Strategic Planning Important to a Business?". Small Business Chron - Hearst Newspapers, LLC. Retrieved 2017-05-12.
- ^ DUTTON, Jane E., DUNCAN, Robert B. (March 1987). "The influence of the strategic planning process on strategic change". Strategic Management Journal. 8 (2): 103–116. doi:10.1002/smj.4250080202.
{{cite journal}}: CS1 maint: multiple names: authors list (link) - ^ a b c d e MITCHEL, Helen, M. (2007). "The 7 Benefits of Strategic Planning". www.strategicmgmtresources.com. Retrieved 2017-05-12.
{{cite web}}: CS1 maint: multiple names: authors list (link) - ^ CAMPBELL, June (n.d.). "5 Steps to Strategic Planning". www.nightcats.com. Retrieved 2017-05-12.
- ^ GLAISTER, Keith W., FALSHAW, J.Richard. (June 24, 1999). "Strategic Planning: Still Going Strong?". Elsevier B.V. 32: 107–116. doi:10.1016/S0024-6301(98)00131-9.
{{cite journal}}: CS1 maint: multiple names: authors list (link) - ^ MONAHAN, Kathleen E. (2013). The Government Manager's Guide to Strategic Planning. EBSCO: London : Management Concepts Press. pp. 12–40. ISBN 9781567264326.
- ^ a b FIELDSTONE, Alliance (1997). "Five steps to develop a strategic plan" (PDF). ECDC US. p. 1.
- ^ a b FIREHOCK, Karen (2015). Strategic Green Infrastructure Planning : A Multi-Scale Approach. EBSCO: Island Press. pp. 33–35. ISBN 978-1-61091-692-9.
- ^ a b CLAYTON, Jim (2017). "The Five Stages of the Strategic Management Process". Small Business Chron - Hearst Newspapers, LLC. Retrieved 2017-05-12.
- ^ SEARCY, Tom (June 3, 2014). "5 Steps to Solid Strategic Planning". Inc.com. Retrieved 2017-05-12.
- ^ DAVID, Fred R. (2011). Strategic Management: concepts and cases (PDF). Library of Congress Cataloging-in-Publication Data. pp. 250–258. ISBN 978-0-13-612098-8.
- ^ ROBINSON JR, Richard B. (July 1983). "The impact of formalized strategic planning on financial performance in small organizations". Strategic Management Journal. 4 (3): 197–207. doi:10.1002/smj.4250040302.