Definition of Strategic Planning

Clear definition of strategic planning avoids the common confusion with business planning, budgeting, and marketing strategies.

What is strategic planning?

Every organisation or major part of a complex organisation occasionally has to make some momentous decisions- the sort of decisions that affect the entire destiny of the organisation for years into the future. These decisions are designed to address the really biggest and most important issues facing an organisation- issues so significant we might call them 'strategic elephants'. So our definition of strategic planning must have something about big decisions.

Such decisions are not simply about small adjustments to activity levels, but are the kind of decisions that may lead to a substantially different organisational structure, or major changes in the relationships among key stakeholders, competitive position, or strategic partners of the organization.

Sometimes the outside world forces such decisions on the organisation. Such forces may include major shifts in the market, big changes in government policy, and radical moves by competing organisations.

Sometimes, it is something inside the organisation that demands a major reappraisal. Technological change driving new methods of carrying out its work, or weakening of its financial structure, or a change in the senior management of the organisation requiring a large re-organisation are examples of such internal forces.

Organisations have always faced such pressures to make huge decisions. In recent years, the pressure has risen to the point where a systematic yet flexible process of dealing with such decisions is called for.

Such a process is variously and sometimes confusingly described as: corporate planning, strategic planning, business planning, and variations such as corporate strategic planning, or strategic business planning. Other labels make the subject more industry specific such as military strategic planning, hospital strategic planning, and in some jurisdictions what others know as urban and regional planning is sometimes called strategic planning.

As its name implies will focus primarily on ‘strategic planning’. By this we have in mind any plan which looks forward several years and which is concerned with massive factors only. The focus of the decisions in the plan are the organisation as a whole in its environment as a whole.

Strategic Planning is Different from Business Planning

A definition of strategic planning must be based on understanding that a strategic plan differs from a Business Plan in three ways;

  • it looks much further ahead;
  • it consists largely of words with just a few figures to indicate the scale of the planners’ intentions. A Business Plan, on the other hand, consists largely of figures. Because these are often unreliable beyond a few months, managers are reluctant to look ahead as far as they may need to. Strategic plans can look further ahead because so few figures are employed, and also
  • what few figures they do contain are tested by risk analysis techniques.

Definition of Strategic Planning

A systematic, formally documented process for deciding what is the handful of key decisions that an organisation, viewed as a corporate whole must get right in order to thrive over the next few years. The process results in the production of a corporate strategic plan.

Check out here for another approach to defining strategic planning.

Strategic Plan

A set of statements describing the purpose and ethical conduct for an organisation together with the specific strategies designed to achieve the targets set for each of these.

So there we have it - strategic planning, and strategic plan defined.

This is not the end of the story about a definition of strategic planning. As you work with a strategic planning process you may want to understand more about other aspects of strategic planning.

There is much more to know
about strategic planning!

The following outlines other aspects of a comprehensive definition of strategic planning.

It helps in gaining support for and understanding of corporate strategic planning to make clear the benefits of strategic planning.

The question What is strategic planning? will be answered in many ways by different people. Here at Simply Strategic Planning we see strategic planning as a systematic way to anticipate and respond to the challenge of change.

The importance of strategic planning is in the small number and the long term impact of the decisions embodied in the strategic plan. These decisions are those required in facing up to the most important challenges facing an organization. It helps in coming up with a clear definition of strategic planning to understand the purpose of strategic planning. These strategic planning issues are characterized by the size of their possible impact on organizational performance and the time span of the impact.

The geographic scope and impact may also set issues apart as strategic. Many more organizations of all types and sizes are having to consider this matter in an international context. Global strategic planning is a process adopted by organizations that operate internationally in order to formulate an effective global strategy.

An effective strategic choice process positions an organization for making sustainable strategic decisions. Learn about the five simple components of strategic planning that reduce risk and dramatically improve long-term performance of your organisation.

Use strategic planning principles to keep your corporate strategic planning process on track. Formal strategic planning as a group decision making process benefits greatly from formalizing of the procedures involved.

Strategic planning and business planning are separate and related, and the idea of merging them under the umbrella strategic business planning is not useful. It is important to be clear about different forms of planning, and in particular the differences between operational and strategic planning.

Another unhelpful suggestion is when people oppose strategic planning and strategic thinking, as if somehow planning did not involve thinking!

A persistent problem for some organizations is the difficulty of getting strategic plans implemented. Applied strategic planning blends strategy formulation with the means of managing strategy implementation.

Useful strategic planning models include clear procedures for objective setting, option generation, results monitoring, issue clarification, and participant engagement.

Corporate level strategy covers the strategic scope of the organization as a whole, and for most organizations is the only strategic plan required.

We have explained in detail what strategic planning is, and that leaves us to clarify what we mean by strategy and strategic. A top manager approved decision that has substantial long term effects, and is accompanied by an integral risk analysis is strategic.

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