The purpose of
strategic planning

The purpose of strategic planning is to set overall aims for your organization and a plan to hit them. The reason for strategic planning is to agree on a way to improve the long-term performance of the organization.

I believe improved performance results from a systematic process of strategic planning. However, having a formal strategic plan does not guarantee improved results. It can guarantee something.

What is the purpose of strategic planning?

The aim of strategic planning is to build agreement among the top people in an organisation concerning its destiny.

The primary purpose of corporate strategic planning is to get all those who hold the reins of power facing in the same strategic direction. It gains agreement on what the few long-term top issues are, and how to deal with them.

Such consensus can also enhance morale and motivation. This agreement, understanding, and alignment enable the achievement of improved organizational performance.

What is corporate strategic planning?

Here I define strategic planning as a systematic, formally documented process for deciding the handful of key decisions that an organization, viewed as a corporate whole, must get right in order to thrive over the next few years.

Design strategic planning to guide senior managers to address the matters most likely to affect the future performance of the enterprise. Adopt a methodical process. This process should surface the big strategic issues, called in the Argenti way, strategic elephants. More on the Argenti way is available here.

Most other approaches stop at considering the goal of strategic planning to be setting overall goals for the organization and then developing a very detailed plan to achieve them. Too often, the listing of a large number of issues and the forest of details involved in addressing them makes the big picture clouded or crowded with minute concerns. This creates opportunities for particular parts of the organization to get their concerns and views on the agenda, and the requirements of the organization as a corporate whole do not get the consideration they deserve.

The stress in this view of the purpose of strategic planning is about the handful of major performance affecting issues, and the very few corporate strategies needed to address them. It is the size and scope of these issues that makes the plans strategic, not any particular tool, technique, or currently fashionable matrix.

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