Strategic planning is the PROCESS by which the GUIDING MEMBERS of an organization ENVISION its future and develop the necessary PROCEDURES AND OPERATIONS to achieve that future.

The planning process can be viewed as a somewhat circular flow of topics and action steps, where the results from one step initiate study and action in the next step. However, the process does not necessarily always flow in one direction. Issues that arise in a particular step may cause the planning team to go back to an earlier step to do additional work. If desired, the order of the steps can even be altered to suit the particular needs of the planning team. The implementation step also does not end the planning process. Analysis of results could easily result in additional analysis or a change in strategic direction. Also, it is recommended that the plan be reviewed on an annual basis to verify that all the base assumptions are still valid and that the implementation plan is progressing according to expectations.

Steps of the Strategic Planning Process:

Areas of Influence

Stakeholders
Role map - who does what, identifying influential relationships, both formal and informal

Situation Analysis - identification of current issues

Environmental Monitoring - External
Competition Analysis
Internal Business Culture -- [Models of Business Culture]
Knowledge Analysis

Plan Development

Testing

Implementation

Commitment to Change - Influence Plan
Balanced Scorecard - document and communicate: strategy, objectives and measures
Measure results

Plan Maintenance

Feedback System - take corrective action as needed; loop back to pevious steps as required

Role of the Planning Consultant

There are many aspects to preparing a business plan. Not all can be handled in-house, even by the largest company. What are your "process" needs? And how will they be met?

Planning to Plan - housekeeping

Who is on the Planning Team?
What is the planning timetable? (need at least 5 to 7 2-day sessions over 6 months)
Where and how often will the planning team meet?
Who will do the research and business analysis?
How will information be given to other stakeholders?

Planning to Plan - readiness determination

Is the CEO committed?
Past Approaches to Planning - reactive, inactive, preactive, and proactive

[ Back to top ]

Stakeholders

A business impacts many, both outside as well as inside the organization. To varying degrees these relationships must be recognized during the planning process, including the communication of the plan.

Values Scan

Evaluation of Business Culture is Critical

Personal values of the Planning team
- not to change, but to understand each other
Values of Organization as a whole
- profit vs. growth
- to what extent is this to be a value added organization
- importance of being a good "corporate citizen"
- importance of being a "good" place to work
Company's operating philosophy
- How work is done
- How conflict is managed
- Accounting procedures
Impact of and on other stakeholders

Are the underlying assumptions valid and relevant? For the future?

Guiding Principles - top-of-mind beliefs and values that drive daily operations

[ Back to top ]

Internal Business Culture

Numerous internal, cultural factors determine the approach an organization will take to the planning process and how the resulting plan will be implemented across the organization. Some corporate soul searching will be required:

Willingness to seriously engage in the strategic planning process
Ability to confront itself in the performance audit and gap analysis phases
Assumptions about the corporate mission
Assumptions about communicating the strategic plan

[Models of Business Culture | Understanding Culture]

[ Back to top ]

Knowledge Analysis

Explicit Knowledge is what is normally seen and thought important. Drives efficiency.

Data
Descriptions
Policies
Procedures
Formulas
Processes

Contributes to efficiency
Leads to competency
Easy to replicate by others

Tacit Knowledge is hidden and not easily seen or recognized as being important. Drives the competitive advantage.

Personal Knowledge
Experience
Know How
Know Why

Hard to articulate
Hard to transfer
Hard to copy elsewhere
High competitive advantage

[ Back to top ]

Vision

A strategic vision is usually thought to be solely future oriented. [ deeper understanding ]

A vision provides an organization a forward looking, idealized image of itself.
Moves outside the usual assumptions.
Concentrates on the end goal, not the means to reach the goal.
Followers gain ownership by developing the means (action plan).

An alternate view from the field of organizational learning expands this to shared vision, which also include a present component.

Vision is not a destination, but an intangible structure that surrounds us and guides our daily activities. From this perspective, a shared vision is a form of self-identity.

Visioning Team - building conversations around what we seek to create together [kick-off meeting]

[ Back to top ]

Mission Formulation

The mission is the ultimate purpose for why the organization exists. [ deeper understanding ]

Building the vision/mission statements

Environmental Monitoring - External

Macro - Raising prices, consumerism, employee attitudes toward work, world & national economy, technological developments.
Industry - Structure, marketing strategies, financing, governmental regulation, products.

[ Back to top ]

Competetive Analysis - market segmentation, competitor profiles

Does anyone (or can anyone) provide substitute goods or services to the same market place?
Early warning system to detect competitor's strategies.

Compete through

Differentiation (internal abilities)
Market segmentation (customer driven)
Cost efficiencies
- capital employed
- product cost
-expense (manufacturing, distribution, marketing, administration)

Understand competition and search for opportunities. But, do not let them dictate your actions. If you are reacting to the actions of others, you are moving away from the ability to create your own future.

[ Back to top ]

Business Modeling

Identify Major Lines of Business (LOB).
Establish Critical Success Indicators (CSI) for each Line of Business to meet the Mission.

[ Back to top ]

Strategy Development

Strategy development requires a two step process:

Identify Strategic Thrusts, and
Determine what Culture is required to support the above strategies.

The basic strategy will fall into one of three focuses (only one of which is price related):

Operational excellence - low price, efficient customer service
Product leadership - product excellence and innovation
Customer intimacy - emphasis on customer relationships within a specific segment

Assessment of Strategic Beg - Strategy is a choice that is made after careful reflection of environmental conditions, internal capabilities, and expected return. To some extent, the company is betting available resources on the success of a chosen strategy over alternate strategies.

[ Back to top ]

Performance Audit

Most Detailed and time-consuming phase.
Indicates ability to move toward ideal future.

Line of Business Analysis

Which Lines of Business are most successful? Which are doing poorly?
Are tracking systems adequate?

SWOT Analysis

Organization's - Strengths & Weaknesses
-- Key Factors that Influence Company Performance
Outside - Opportunities & Threats

Risk Assessment

Uncovering Hidden Dangers

[ Back to top ]

Gap Analysis

Gap analysis - identifying the difference between the current situation and what is desired
Reality test (Face the facts)
Compromise on both ends
- Scale vision back, or
- Work to bridge the gap.
May be impossible to close all gaps simultaneously
- Prioritize efforts.

[ Back to top ]

Implementation

Total organization agreement to full plan.
Inter-function agreement to each other's plans
- Budget impact between units (may be difficult)
- Human capital planning - Importance of having the right people in the right place at the right time with the right skills
Enthusiastic announcement
Tracking and course adjustments
Using the Balanced Scorecard Concept for Planning Implementation - analyzing the cause and effect of business processes needed to sucessfully implement business strategy, with built-in measurements to track progress.
Go to Implementation Topics for further information.

[ Back to top ]

Transformative Networking – connecting change leaders to enable self-organized grassroots change.
http://groups.google.com/group/transformative-networking

Next Steps – While still conceptual, transformative networking offers the possibility of leading change through the networking of those already interested or involved in similar initiatives, effectively tearing down existing silos of practice that exist across disciplines and fields of work. The next step is to develop a proof of concept built on the theoretical underpinnings above, possibly using Google Wave as the collaboration platform. Included will be identifying the minimal structure and governance required to enable self-organization within the network while not constraining what might emerge. Join this initiative and help create the future of organizing - networking communities of interest.
http://groups.google.com/group/transformative-networking

enTarga
Home Page

Organizational Change

Strategic Planning

HR Planning

Organizational
Complexity

Knowledge
Management

[ Sitemap & Table of Contents | Contact Us ]