Strategic Planning is not an academic exercise, but a key tool to set the future course for a business and to communicate a consistent message of this course to all employees. It is a device for coordinating the activities of the organization and the employees to achieve a common goal.
The process of strategic planning involves at the beginning the senior management. They meet in sessions of at least 4 hours. These sessions are best held off-site and away from work distractions. Because many businesses conduct infrequent planning sessions, it can be helpful to use knowledgeable consultants. A consultant can provide value by explaining the importance of each step and keeping the senior management on task to complete the plan.
There are 5 major steps in the strategic planning process. The first step in this process is to confirm the current state of the business. Typically this step involves asking and answering four questions:
- What are the major strengths of the business?
- What are the major weaknesses of the business?
- What opportunities are out there of which the business should take advantage?
- What threats are there to the existence ,or the success of the business?
Having established this current state of the business, the third step is to determine what future course the business should take. This step will usually involve brainstorming sessions with the senior management team setting the direction of the business. As the vision of the future business begins to take shape, the senior management will identify projects that will bring the business closer to its vision.
The fourth step is to conduct a cost/benefit analysis of each project. Every business has a limited amount of resources with which to achieve its goals. By calculating the cost and benefit of each project, management can determine which project will bring the best result for the money. The management team will rank the projects by their cost/benefit calculation. This ranking will allow the management team to confirm the most important projects to apply their resources.
The fifth step is to revise the vision of the company by formally defining the project tasks (in terms of resources, time table, priority and goals). The senior management team must then communicate this vision, the projects and its importance to the busienss to all employees. This step should never be rushed or ommitted by management. Just because the senior managment team understands the vision and tasks, don’t presume the employees understand the need and the vision. Taking time to explain the vision, and its importance to the business, to all employees is crucial to the success of the final step in the strategic planning process.
With the vision and project tasks defined, the strategic plan must be implemented by the business. The final step of strategic planning includes the following actions:
- Teams or individuals are assigned to each project.
- Senior management oversees all projects
- Typical project management techniques are followed with timetables; reports on progress and corrective actions.
The process of Strategic Planning should not be a dreaded task or a task to be taken lightly. The success of the Strategic Plan could determine whether the business succeeds or fails.
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