What is Strategic Planning? | Meaning & Definition | Akrivia HCM

Strategic planning is a process that defines an organization’s long-term goals and objectives and develops a plan to achieve them. It involves analyzing the current situation, goal setting, developing strategies to achieve them, and then implementing and monitoring the plan’s progress. Strategic planning is a part of organizational management and decision-making and can help organizations to remain competitive in their markets.

Strategic planning provides organizations with a roadmap for success, helps align resources and efforts, and enables proactive decision-making. It guides making strategic choices, allocating resources efficiently, and adapting to dynamic market conditions to achieve long-term success.

What are the strategic planning steps?

The strategic planning process typically involves several key steps. Here are the general steps involved in strategic planning:

1. Define the Mission and Vision: Clarify the organization’s purpose, values, and long-term aspirations. The mission statement describes the organization’s actions, while the vision statement outlines the desired future state.
2. Conduct a Situation Analysis: Evaluate the internal and external environment to understand the organization’s current position and identify opportunities and challenges. To develop an effective strategy, you must analyze industry trends, competitor analysis, SWOT analysis (strengths, weaknesses, opportunities, and threats), and market research.
3. Set Objectives and Goals: Based on the analysis, establish specific, measurable, achievable, relevant, and time-bound (SMART) objectives. These objectives should align with the organization’s mission and vision and address critical areas of improvement or growth.
4. Formulate Strategies: Develop strategies that outline the broad approaches or methods the organization will use to achieve its objectives. Strategies provide a high-level roadmap for decision-making and resource allocation. Common strategies include market penetration, product development, diversification, and expansion.
5. Develop Action Plans: Break down the strategies into actionable steps or projects. Specify the tasks, timelines, responsibilities, and resources required for each action plan. This helps to ensure accountability and clarity in executing the strategies.
6. Implement the Plans: Put the action plans into motion by allocating resources, assigning responsibilities, and executing the planned activities. This stage involves coordination, communication, and monitoring progress to ensure effective implementation.
7. Monitor and Evaluate: Regularly assess the progress and outcomes of the strategic initiatives. Measure key performance indicators (KPIs) to evaluate whether the organization achieves its goals. If necessary, adjust strategies or action plans based on the insights gathered during the monitoring process.
8. Review and Update: Conduct periodic reviews to reassess the organization’s mission, vision, and strategies. This helps the organization stay on top of changes in the external environment and make strategic decisions that are relevant, responsive, and adaptable. Strategic planning is a continuous cycle of analysis, planning, implementation, and review.

Types of strategic plans

Strategic plans can vary depending on the organization’s specific goals and objectives. Here are some common types of strategic plans:

• Corporate Strategy: This type of plan is developed at the highest level and sets the entire company’s overall direction and long-term goals. It addresses key questions such as market positioning, diversification, mergers and acquisitions, and resource allocation.
• Business Strategy: Business unit strategy focuses on a specific division or unit within the organization. It outlines the unit’s goals, competitive advantage, target market, and operational plans. This plan aligns with the corporate strategy but provides more detailed guidance for a specific part of the organization.
• Functional Strategy: Functional strategies are developed by various organizational departments, such as marketing, finance, human resources, and operations. These plans define how each function will contribute to the overall business objectives. They address specific areas of expertise and outline actions to achieve functional goals while supporting the broader strategic direction.