When is strategic planning done

Provides clearer focus for the organization, thereby producing more efficiency and effectiveness. Provides the glue that keeps the board members together in the case of corporations. Produces great satisfaction and meaning among planners, especially around a common vision. Increases productivity from increased efficiency and effectiveness.

Solves major problems in the organization. The scheduling for the strategic planning process depends on the nature and needs of the organization and the its immediate external environment.

For example, planning should be carried out frequently in an organization whose products and services are in an industry that is changing rapidly. In this situation, planning might be carried out once or even twice a year and done in a very comprehensive and detailed fashion that is, with attention to mission, vision, values, environmental scan, issues, goals, strategies, objectives, responsibilities, time lines, budgets, etc.

On the other hand, if the organization has been around for many years and is in a fairly stable marketplace, then planning might be carried out once a year and only certain parts of the planning process, for example, action planning objectives, responsibilities, time lines, budgets, etc are updated each year.

Consider the following guidelines: 1. Strategic planning should be done when an organization is just getting started. Strategic planning should also be done in preparation for a new major venture, for example, developing a new department, division, major new product or line of products, etc.

Strategic planning should also be conducted at least once a year in order to be ready for the coming fiscal year the financial management of an organization is usually based on a year-to-year, or fiscal year, basis.

In this case, strategic planning should be conducted in time to identify the organizational goals to be achieved at least over the coming fiscal year, resources needed to achieve those goals, and funded needed to obtain the resources. These funds are included in budget planning for the coming fiscal year.

However, not all phases of strategic planning need be fully completed each year. The full strategic planning process should be conducted at least once every three years.

As noted above, these activities should be conducted every year if the organization is experiencing tremendous change. Each year, action plans should be updated. Note that, during implementation of the plan, the progress of the implementation should be reviewed at least on a quarterly basis by the board. Again, the frequency of review depends on the extent of the rate of change in and around the organization.

NOTE: Although there are separate sections listed below for many of the major activities in strategic planning for example, the sections "Developing a Mission", "Developing a Vision", etc.

The reader might scan of the articles to get a basic feel for strategic planning processes and the diversity of views on the processes.

However, do not conclude that you can learn the most important aspects of strategic planning by reading some of the following articles -- many of them are by authors who write about certain aspects of strategic planning, but not all aspects, so be sure to review resources in other subtopics of this overall topic of strategic planning. Strategic plans come in a wide variety of formats, depending on the nature and needs of the organization.

Improving Board Effectiveness - Oversight of Strategy Corporate strategy: 20 questions directors should ask in order to be involved and effective. See a video about how to customize the planning process to suit your organization's nature and needs.

Many managers spend most of their time "fighting fires" in the workplace. For these managers -- and probably for many of us -- it can be very difficult to stand back and take a hard look at what we want to accomplish and how we want to accomplish it. We're too buy doing what we think is making progress. However, one of the major differences between new and experienced managers is the skill to see the broad perspective, to take the long view on what we want to do and how we're going to do it.

One of the best ways to develop this skill is through ongoing experience in strategic planning. The following guidelines may help you to get the most out of your strategic planning experience. The real benefit of the strategic planning process is the process, not the plan document. There is no "perfect" plan. There's doing your best at strategic thinking and implementation, and learning from what you're doing to enhance what you're doing the next time around.

The strategic planning process is usually not an "aha! It's like the management process itself -- it's a series of small moves that together keep the organization doing things right as it heads in the right direction. In planning, things usually aren't as bad as you fear nor as good as you'd like. Start simple, but start! It's best to have a team of planners conduct strategic planning. Therefore, it's important to have skills in developing and facilitating groups. You may want to consider using a facilitator from outside of your organization if: 1.

Your organization has not conducted strategic planning before. For a variety of reasons, previous strategic planning was not deemed to be successful. There is no one in the organization who members feel has sufficient facilitation skills. No one in the organization feels committed to facilitating strategic planning for the organization.

Leaders believe that an inside facilitator will either inhibit participation from others or will not have the opportunity to fully participate in planning themselves. Leaders want an objective voice, i. Also see Consultants using. Strategic planning should be conducted by a planning team. Consider the following guidelines when developing the team. Note that reference to boards of directors is in regard to organizations that are corporations.

The chief executive and board chair should be included in the planning group, and should drive development and implementation of the plan. Establish clear guidelines for membership, for example, those directly involved in planning, those who will provide key information to the process, those who will review the plan document, those who will authorize the document, etc. Examples and links are very useful too.

Any discussion on Strategic Planning is good discussion — it is such a critical element of any organisation that aspires to be good and dares to be great. Informative article! You have made strategic planning so easy to understand. But how do i reference this article in an academic paper? Vo, Eric. I fully agree with you. The article is useful, but mostly for beginners and students. But it is informative and I liked it as well. Thank you for sharing this very informative article.

It will definitely guide me in conducting our own Strategic Planning at our office. I definitely enjoyed every little bit of it. It is a great website and nice share. I want to thank you. Good job! You guys do a great blog and have some great content. Keep up the good work. SEO canada. Companies first come up with strategic plan to establish their long term goals and objectives along with general actions to be taken to support those goals and objectives. You then establish policies to ensure that your team is staying within those actions.

For example, your strategic plan may say you want to increase revenues 20 percent next year in the aerospace market. Your actions will include marketing campaigns and outreach events. Your policies will then ensure that your team are not undertaking actions that are not included in these campaigns and events. Thank you for this article. It helped me to understand the strategic planning process, which is something I am studying and this was straightforward and to the point.

This article is a good basic overview. Something that must be emphasized is translating the strategic plan into specific actions with measurable outcomes. If you go into work on Monday after completing your plan and do your work the way you did before the plan, then the plan has already failed. I see this frequently in the businesses with which I work. Another key is to clearly tie individual staff roles and performance expectations and goals to the strategic goals.

Thanks for sharing. This is very helpful to business owners and managers. As it is said, the strategic plan need to be flexible, same applies to getting knowledge of strategic plan as business environments keep changing. Thanks for so much for the this exciting read. Strategic planning is important to an organization because it provides a sense of direction and outlines measurable goals.

Strategic planning is a tool that is useful for guiding day-to-day decisions and also for evaluating progress and changing approaches when moving forward. Found an another website Evolvetraining. I really enjoyed reading the article. It was written in simple language and in a manner that helped me identify key points under each subtitle. I am going to use this as a guide to some strategic plans am working on, thanks.

I actually appreciate this piece. The writing is incredibly beneficial. My gratitude to the masterminds behind this program, Cheers. Your article is helpful if you have employees, but how does this work if you have sub-contractors? Do you get them involved? Now i have an insight of what strategic planning is. So what can be the sub-topics to include when writing an essay? Great article. Thanks for the detailed information. Very interesting and valuable document. Enjoyed reading the participatory role of employees.

Thanks a lot. Interesting read. This article is a meta-analysis of empirical studies on strategic planning and organizational performance. It shows whether and when strategic planning actually works based on quantitative evidence. Great article on strategic planning for small businesses. I agree with the statistic you quote from Constant Contact. In my work, I find that most business owners can only think and plan about a year out. For many business owners, this is the first time they have ever been where they are.

The second is the rate of change in the economy, which only speeds up each year; it is just that very few businesses have the tools and expertise to keep pace with the change. Both factors lead to a general hesitation to look out too far or to dream too big. I love the fact that you see that strategic planning needs to flexible and inclusive. When you involve all the people who work in and on your business, there is more engagement, better ideas and a higher rate of success. Thanks a lot for this wonderful article, Eric.

You have resolved my problem of trying to know what strategic planning really is. I look forward to more up building articles. Your question about involving subcontractors is an interesting one. So if you have a few good contractors like my company does that you think could contribute some value to the formation of your plan I say go for it.

Your article is helpful if you have employees, but how does this work if you have sub-contractors. Do you get them involved. You have the BEST newsletter! This article was another great one. I shared it on all my social media platforms. The ensuing discussion centers on these activities in a hypothetical but representative corporation whose fiscal year corresponds with the calendar year.

Naturally, its scope and the degree of detail provided vary greatly from one company to another. The preparation of such a statement gives division managers guidance as they begin strategic planning for their businesses.

So as a minimum the statement must include the intended company policies for allocating resources among the divisions. Therefore, the delineation of an explicit statement of corporate strategy is often deferred until the final step in the first cycle. In general, the more diverse the corporation, the less feasible it is to develop an explicit, cohesive strategy for its businesses and, therefore, the more desirable it is to make the resource allocation policies explicit at an early stage.

On the other hand, less diversified companies frequently delay preparing a strategy statement until the division heads have developed strategic proposals for their own businesses.

Many large corporations are divisionalized, but not so many are highly diversified. The more common practice is to delay the definition or redefinition of corporate strategy until it can be stated in fairly explicit terms.

Giving the initiative to the division manager at this step challenges him to think strategically about the scope of his activities and then propose a charter broad enough to permit him to contribute significantly to achieving corporate objectives. Formalizing this step in the planning process is an important device by which corporate management widens the horizons of division heads.

An explicit charter also serves two secondary purposes: 1 it increases the likelihood of clear agreement between the top executives and the division manager about the scope of his activities, and 2 it reduces the risk of redundant efforts or competition between divisions. Obviously, the decision based on this analysis is crucial because the long-term performance of any division is a function of the strategy it adopts, and the performance of the company as a whole is likewise a function of the strategies of its particular businesses.

Although the initiative for identifying and analyzing strategic options lies with the division manager, guidelines that headquarters gives him for presentation of his proposals affect the way he pursues the task.

Increasingly common is a request by corporate management that when he proposes a strategy and specifies goals, at the same time he also present a statement of the alternative strategies which he has evaluated and rejected.

The recommendations may also include a general statement of the action programs that would be developed to implement the strategy developed in more detail in the second cycle and a crude estimate of the resources that would be required. Detailed financial data are usually not included at this step because such information is not necessary to evaluate the strategy and because the effort of preparing it may go to waste if the recommendations are modified.

In the ensuing discussions, which extend over several meetings in late spring, corporate management and each division chief work toward reaching an agreement about the appropriate division strategy and goals.

By the middle of June top management has prepared an explicit statement of corporate strategy and goals. In some companies this document is, in effect, a set of decisions on how resources are to be allocated among the divisions, as well as a forecast of the results expected from each. In most cases, however, the statement is not intended to constitute a final resource allocation decision; rather, it is designed to provide feedback to the division managers about the corporate implications of the agreed-on business strategies.

The presentation and discussion of corporate strategy and goals are also commonly used as a device to initiate the second cycle of the planning process. The sum of the recommended division goals is likely to be inadequate to achieve the goals envisioned by headquarters for the entire organization. It can improve division performance by pressing, during the review of division recommendations, for more aggressive strategies and more ambitious goals.

It can divert company resources into more promising businesses. This move may give rise to an acquisition program. Momentum is a factor in the continued success of a diversified corporation—as with a rocket headed for the moon—and a wise chief executive does not dissipate it needlessly.

Occasionally—perhaps inevitably—a major corporate shift is necessary, affecting one of its businesses. Care must be taken to isolate the effect on the remaining businesses. In late spring a couple of years ago, for example, top management of a major diversified corporation went through its usual review of division strategic plans.

But the eventual profits will be enormous. With minor modifications, top management approved the proposal. Three months later the company abruptly announced that the business would be discontinued and the investment written off.

Poor planning? Obviously, the decision to enter the business was a mistake. But implementation of that decision, and the planning done to minimize the investment exposure without compromising the chances for success, were probably sound.

There are two important lessons here about the process of corporate planning:. Strategic decisions—like this divestment—are not made in accordance with some precise timetable. Formal planning procedures are not intended to facilitate strategic decisions such as this—if only because a division manager rarely recommends the disposal of his operation. Rather, formal corporate strategic planning has the more modest, if no less crucial, purpose of seeking to optimize the collective thrust of the continuing businesses.

Fast paced organizations in the tourism or technology sector may review their strategies every month, while slower paced organizations, like government or sports teams, may update their strategy every one to three years. There is no one-size-fits-all timeframe for strategy. How often you choose to update your strategic plan is less important than moving through the process on a cyclical basis.

The main purpose of strategic planning is to make sure that everyone within your organization understands its mission, vision, and values and that they are aligned and empowered to make the best decisions to effectively achieve the organization's goals.

The first step in creating this alignment is to communicate with your team early on in the strategic planning process.