|Strategic Planning is one of the most important aspects of business
management and also unfortunately one that is very commonly neglected or
overlooked. A good, balanced Business Strategy gives structure to your vision and mission. It
is the way to realize your dream.
So what is a Strategy?
Someone once said: "If you don't know where you are going,
then any road will get you there."
Strategy is the pattern or plan that integrates an organizationís
major goals, policies and action sequences in a cohesive whole.
Strategy is deciding where your company is today, where it should be
tomorrow and how it will get there.
Strategy therefore is that which gives direction to an
organization. This includes the foresight to anticipate changes;
in fact to initiate changes.
It is a high level action plan ... always with the end result in mind
and structured in such a way that it can be broken down into lower
strategies and action plans that can be understood and executed at all
levels in the organization.
A well formulated strategy will always answer the following
|WHO is responsible?|
|WHAT is he/she responsible for?|
|By WHEN does it have to be done?|
|WHERE is it going to happen?|
|HOW is it going to be done?|
The importance of this is clearly illustrated by the famous Swiss
watch industry. There was a young technician who discovered
that quartz could be used as a very accurate timing device.
However, the masters of the industry thought it an unacceptable idea,
until the Japanese, with their foresight and vision, grabbed the idea,
perfected it and captured the watch industry of the world.
The Benefits of a Strategic Approach to Managing
Today's managers have to think strategically about their company's
position and about the impact of changing conditions. They have to
monitor the external situation closely enough to know when to institute
strategy change. They have to know the business well enough to
know what kind of strategy changes to initiate. The
fundamentals of strategic management need to drive the whole approach to
The advantages of first rate strategic thinking and conscious
strategy management (as opposed to freewheeling improvisation,
gut feel and drifting along) include:
|Providing better guidance to the entire organization on the
critical point of "what it is we are trying to do and to
|Making managers more alert to the winds of change, opportunities
and threatening developments.|
|Providing managers with the rationale to evaluate competing budget
requests for investment capital and new staff - a rationale that
argues strongly for steering resources into strategy-supportive,
|Helping to unify the numerous strategy-related decisions by
managers across the organization.|
|Creating a more pro-active management posture and counteracting
tendencies for decisions to be reactive and defensive.|
The advantage of being proactive rather than reactive is that
trail-blazing strategies can be the key to better long-term
performance. Business history shows that high-performing enterprises
often initiate and lead, not just react and defend.
Aggressive pursuit of a creative, opportunistic strategy can propel
a firm into a leadership position, paving the way for its
products/services to become the industry standard.
formulate your Business Strategy
An organization's strategy is nearly always a blend of prior moves,
approaches already in place and new actions being mapped out.
Crafting strategy is an exercise in entrepreneurship - risk-taking, venturesomeness,
business creativity, and an eye for spotting emerging market
opportunities are all involved in crafting a strategic action plan.
are four basic approaches to strategy formulation:
|The Master Strategist Approach. Here the
manager personally functions as chief strategist and chief
entrepreneur, exercising strong influence over the strategy
alternatives that are explored and over the details of the
strategy. This does not mean that the manager does all the
work; the manager becomes the chief architect and initiator of
|Delegate-It-to-Others Approach. The manager
delegates the strategy making exercise to others, and stays off to
one side. He keeps in touch via reports and conversations,
offers guidance, reacts to recommendations, and puts a stamp of
approval on the strategic plan after it has been formally
presented. It has the advantage that the manager can pick and
choose from the strategic ideas that bubble up from below, but has
the weakness that the manager can end up so detached from the
process of formal strategy-making that he or she exercised no real
|The Collaborative Approach. This is the middle
approach whereby the manager enlists the help of key subordinates in
hammering out a consensus strategy that all key players will back
and do their best to implement successfully. The biggest
strength of this approach is that those who helped crafting it, also
have to implement it. The "I told you it's a bad idea"
alibi won't fly.|
|The Champion Approach. In this style, the
manager is interested in neither in personally crafting the details
of strategy nor in the time-consuming task of leading a group to
brainstorm a consensus strategy. This approach works best in
large diversified corporations where the CEO cannot personally
orchestrate strategy making in each business division.|
|Of the four basic approaches managers can use in crafting strategy,
none stands out as inherently superior - each has strengths and
The Strategic Process
A successful strategy is analytical and fact based. It must be
built on consensus and practical implementation. These two
dimensions therefore need to be emphasized during the process. It
is now possible to integrate these into the following matrix:
All Form/No Substance
This is the type of strategy developed by completing forms compiled
by corporate staff. They lack facts, analysis and
perspective. They can look impressive through elaborate reports,
with little commitment to making them work.
This is a typical approach adopted when key managers and board
members retreat away from corporate headquarters. The strategy is
formulated through a lot of brainstorming, yet giving little attention
to numbers or other relevant data. This renders the strategy
difficult to interpret and more so to implement.
Management has little involvement and therefore there is low
awareness of implementation issues. This approach is typically
adopted by "professional strategic planners" using specialized
statistic techniques. They are statistically correct and well
motivated, but do not take organizational issues like corporate culture
or the ability to carry them out, into account.
The Winning Combination
In this approach, high levels of management involvement and awareness
of implementation issues are combined with in-depth, objective
analyses. This is best done trough a combination of managers,
corporate staff and professional strategic planners, together
formulating strategies. It usually results in the strongest and
most applicable strategies which stand the best chance of successful
Implementing and managing Strategy
Click here for some techniques for Strategy Implementation.