Examining strategic planning components
Strategic planning is a process that sets priorities and guides an organization’s future direction. Ideally, management should undertake the strategic planning process every three or four years. An effective strategic plan is helpful in focusing energy and resources, keeping employees working toward a common company goal, ensuring all stakeholders are on the same page, and deciding on key objectives for the coming years.
An effective strategic plan considers the following components:
SWOT (Strengths, Weaknesses, Opportunities, Threats)
The best way to approach the creation of a strategic plan is to figure out what you want to achieve. From there, you should utilize a SWOT analysis to figure out your strengths, weaknesses, opportunities, and threats. This analysis forms the basis of a great strategic plan. This outward-looking part of the SWOT analysis is the study of opportunities and threats. Sometimes this is called PESTLE analysis, it stands for Political, Economic, Social, Technology, Legal and Environmental factors. From there, address all four components to strengthen your business. Using this method will help you determine the kind of strategy you want to utilize for the coming year. By considering how your organization performs and the broader trends impacting your organization, you will have a thorough foundation to begin your strategic plan.
Vision
A vision statement describes what your organization aspires to be. Its focus is on the future. It asks “What do we do? Where are we going?”
Mission
A mission statement describes how you will get to where you want to be. It defines the purpose and primary objectives related to your customer needs and team values. A mission statement talks about the present and how it leads to the future. It asks “What do we do? What makes us different?” A clear mission provides your employees with guidance that shows them what they are to do on a daily basis. When your employees know what the basic strategies and goals are for the company, they can align their actions with them. The goal when defining your mission is to make the statement broad enough for management and employees alike to understand. At the same time, it is critical to narrow the focus so all employees can focus on goals that support the larger mission.
Values
Values are the operating philosophies or principles that guide an organization’s internal conduct. They also serve to guide the relationship with its customers, partners, and shareholders. Defining core values aligns an organization’s culture with its reason for being.
Strategies
Strategies map out how you will achieve your mission and vision. What are the broad strategies your organization will take to distinguish it from the competition and allow it to prosper? Successful strategic plans involve diverse perspectives to arrive at the right strategies.
Goals
Once strategies have been articulated, your organization needs to create goals to achieve over time. Goals should be measurable and able to be monitored easily. It is helpful to specify a timeline, quantity, or some other metric to use for measurement. Goals must be measurable and specific to be helpful.
Action Plans
Action plans drive strategic plans for completion. The creation of a detailed action plan that includes what is to be done, who is to do it, and when it should be complete, is an ingredient often missed in strategic planning.
Wrapping it all up
The process of strategic planning will guide your organization to evaluate and define where it should be and also show you how to get there and be successful. A strategic plan communicates to all members of your company what the goals are, how to achieve them, and all other components that are beneficial to understanding the plan.
