The rise of Strategic Planning (contd.)
Beginning in the late 1970’s, business thinkers began to focus on strategy and how decisions were made, and they began to connect this process of thinking to the real world, where strategy is played out.
“The Evolution of Strategic management” written by global management consultants McKinsey and company, identified the phases of ineffective planning that that had plagued American and Australian industry and left it vulnerable to new challenges coming from Asian countries. The article called for changes in the way we think and the way we conceive of planning.
The first phase identified by McKinsey was the financial planning phase of the 1950’s. Here planning was viewed as almost a financial problem and was conducted as an annual budgeting exercise.
The second phase was forecast-based planning, which recognised that deeper thinking is necessary about resource allocation and development of key issues.
The third phase was externally oriented planning, this was even better because it looked outward to how the firm interacts with the external environment of competitors and other business.
The final phase was strategic management itself. Here the aim was, to weld strategic planning and management into a single process in pursuit of that lodestone – the linking of strategy conception with execution. This means diffusing the ability to think strategically throughout the entire organisation.
A Six Step Process for Strategic Planning Today …
The strategic planning process offers great benefits if pursued correctly.
The following six steps constitute one version of the process: mission, objective, situation analysis, strategy formulation, strategy implementation, and control.
- The first step is to define your mission, this is the core that guides you. Your mission is what you look to in setting your objectives.
- The objectives established in the second step are chosen based on some notion of wanting to fulfill your mission. They should be clear, concise, achievable, and in some sense, measurable.
- The environmental scan is the third step and is pivotable for most organisations and is the most involved. Look at both the internal and external environments in which your organisation functions. On a personal level, evaluate the external factors that impinge on you with respect to your objectives.
- The fourth step is the actual formulation of strategy. Decide what you will actually do in getting to get from where you are to where you want to be. Allocate resources and connect your management decisions with the people who will implement the plan.
- The fifth step is implementation of strategy, and here is where many organisations fail because they do not follow the military dictum to “supervise and refine” This means not to simply issue orders and assume they will be carried out.
- The sixth step, control, involves developing a control mechanism to evaluate whether or not the plan is working. When the control or monitoring system tells you that something is amiss in your strategy, you can then circle back to your environmental scan to discover whether the relevant environmental factors have changed.
As you enter into the strategic planning process consideration must be given to allow sufficient time for your strategy to be successful.
The idea of seeking competitive advantage by doing things differently should guide your thinking every step of the way!
With a core sense of mission, anyone can develop a competent and effective strategy using the basic strategic planning process – whether for business, a team or the accomplishment of personal goals.
The attitude of a strategic thinker
Writer and minister Robert J. Hastings wrote:
“It isn’t the burdens of today that drive men mad,
but rather regret over yesterday and the fear of tomorrow.
Regret and fear are twin thieves who would rob us of today.”
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