Intellectuals and corporate executives agree that strategy is the cornerstone of the modern firm.
Michael Porter argues that the essence of strategy is about being different and choosing to perform activities differently than rivals do. In essence, strategy relates to those “set of related actions that managers take to increase their company’s performance.” (Hill et al. 2017).
Why is Strategic Planning Important?
As a CEO or an executive, ask yourself:
Do you know what your organization’s strategy is?
How much time have you or the firm dedicated to developing a strategic plan?
If you can’t answer this question easily, then it’s time to seriously think about your strategic planning process.
Strategic planning can be thought of as an ongoing organizational process of using available knowledge to document a business’s intended direction, build on what the firm does differently than its competitors. This process is often used to prioritize efforts, effectively allocate resources and align shareholders and employees with the organization’s goals, and plan for execution.
You may wonder, why is strategic planning important? To answer, consider the following:
- What mechanism can you use to align employees to the vision, mission and values of the firm?
- How can the organization understand what it does well, what its not so good at and what opportunities and threats are prevalent in the external environment?
- What goals are the organization is working towards and have you defined what you measure and how you track progress? The idea is to establish Key Performance Indicators, we discuss this in another article found here.
- Do you spend time writing, debating and reviewing future plans?
If you can’t clearly answer these questions, they you need a strategic plan.
Spend time on the future
To summarize, strategic planning can benefit your organization’s identification of strategic initiatives, alignment of the organization to strategic goals and objectives and ultimately, execution.
If strategic planning is a something you’d like to improve or implement in your organization, please setup a quick call with us to see how we can help provide the knowledge and techniques needed to help you and your organization. Remember, strategic planning is not just for the big corporation, small and medium businesses also need to have a strategic plan, for this is a necessary path to growth.