Strategic Planning:
Definition, Example and Synonyms
Strategic planning refers to the process by which organizations predict how their industry will develop, define their long-term goals for the future and select projectsProjectA project is a time-limited undertaking with defined objectives and resources that delivers unique results and often includes complex tasks. to contribute to those goals. When making a strategic plan, it is best to focus on your beliefs surrounding the future, how you think this will affect your business environment and actions you can take to steer your company in this future environment. The strategic plan is formally written every 2-3 years.
Once it’s on paper, the strategic plan should be evaluated and revised regularly. This will ensure that the strategy continuously develops, which will help your organization remain agile and adaptable in the face of change.
A Practical Example
An example might help to clear things up. Let’s say I work at a plastic widget manufacturer for the automobile industry. For whatever reason, I believe that oil prices will fall over the next 5 years.
Based on my belief of future oil prices, I should decide what this means for my company and its broader business environment. I can make a few key predictions: “it will be cheaper for us to manufacture our product,” “more people will be able to afford vehicles, increasing demand for our product,” etc. Overall, falling oil prices would be good for my business.
Next, I can lay out a few key goals to make the most of this likely future business environment. For instance, increasing widget production in the medium-term to anticipate increased long-term demand.
With this goal in mind, I propose or approve projects based on how well they align with these predictions. If we are already running up against maximum production capacity, our first project may be to acquire and install additional machinery. Or, if we have idle machinery, maybe it is to hire additional personnel to operate it.
Synonyms and Abbreviations
Although strategic management is occasionally used as a synonym for strategic planning, it is really the process through which the strategic plan is implemented. We are unaware of any synonyms for strategic planning.
FAQ
When creating a strategic plan, you should really focus on drafting a strategy.
Your strategy should focus on three things: your beliefs for future economic developments, the effect these will have on your business environment and actions you can take to establish an advantageous position in this future environment.
At this stage, the organization starts by defining its beliefs for how their business environment is likely to develop. Think of this as a mission or a vision statement. Once they have a vision for the future, they define which plans and projectsProjectA project is a time-limited undertaking with defined objectives and resources that delivers unique results and often includes complex tasks. would be the most beneficial.
When it comes to the future, most people want to reduce risk as much as possible. This is what causes strategic planning documents to be excessively and unhelpfully long.
Any strategy should help manage risk associated with change, but doing so should not be particularly laborious. Here are a few tips for successful strategizing:
- Keep it simple: Pare down the strategy to answer two simple questions: which customers to win and how to win them.
- It’s not about perfection: Free yourself from the pressure to plan out detailed actions and set goals for every single department or team. Set company-wide goals and motivate your teams to contribute to them.
- Be clear and concise: Make the goals explicit and easily understandable. It should be based on a few assumptions and not countless financial forecasting spreadsheets.
Part of the reason for focusing only on strategy is to outmaneuver your own instincts. The economic factors that play a role for a business are beyond any one person’s control. Successful strategy is not about reducing every source of risk — it’s about adapting to change.
Strategy and planning should work together in tandem. The relationship should be top-down; what you see in your market and the economy more broadly should inform your decision-making.
There are a few models that describe how strategy and decision-making should interact. We believe that Lean PPM, an approach focused on PPMPPMSynonym for → Project Portfolio ManagementProject portfolio management (PPM) is a process that seeks to select, prioritize, monitor and analyze a company’s projects. that integrates elements of lean manufacturing, provides a great framework.
Strategic Planning with Meisterplan
Planning is a long and complicated process at every organization. Any program you use for strategic planning should help make communication easier.
With Meisterplan, you can quickly get an idea of which projectsProjectA project is a time-limited undertaking with defined objectives and resources that delivers unique results and often includes complex tasks. are ongoing and what stage they’re at. Not only that, but you can assign projects to specific strategic goals, making sure you are always prioritizing the right things.
Easier communication and planning help you save time – time you can use to adapt your strategy and keep it emergent. Meisterplan’s custom views provide an overview of where your projects are at so you can get back to strategizing.
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