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Strategic Plan

This document outlines the importance of strategic planning and execution. It discusses that while developing strategies is relatively easy, effective execution is very difficult as there are many political and organizational obstacles. A strategic plan is a tool that defines the routes to achieve the goals of a business. The document then discusses key aspects of strategic plans such as clarity, format, distribution, objectives, resources, timelines, and contents. It also discusses common reasons for failure such as lack of commitment, improper delegation, and lack of communication and implementation guidelines. Developing strategic plans requires senior management commitment and treating it as an ongoing process.

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PoojaSahay
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199 views4 pages

Strategic Plan

This document outlines the importance of strategic planning and execution. It discusses that while developing strategies is relatively easy, effective execution is very difficult as there are many political and organizational obstacles. A strategic plan is a tool that defines the routes to achieve the goals of a business. The document then discusses key aspects of strategic plans such as clarity, format, distribution, objectives, resources, timelines, and contents. It also discusses common reasons for failure such as lack of commitment, improper delegation, and lack of communication and implementation guidelines. Developing strategic plans requires senior management commitment and treating it as an ongoing process.

Uploaded by

PoojaSahay
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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Strategic Plan

Abstract
Creating strategy is easy, but implementing it is very difficult. Without effective execution, no business strategy can succeed. Unfortunately, most managers know far more about developing strategy than about executing it -- and overcoming the difficult political and organizational obstacles that stand in their way. Any strategy is backed by an execution plan. Strategy Plan for a business is as important as a map to a rally driver. This note talks about the Strategy Plan and its importance in Strategy execution.

1. Introduction
Robert Kaplan, a leading international business management guru revealed that less than 10% of formulated strategies are executed effectively. Developing a good strategy may be simple but execution of the strategy is very difficult. Companies keep documentation of even small strategies so that they can learn from it. Strategic Plan is a tool that defines the routes that when taken will lead to the most likely probability of getting from where the business is to where the owners or stakeholders want it to go. And like a road rally, strategic plans meet detours and obstacles that call for adapting and adjusting as the plan is implemented. A strategic plan is driven from the top down; considers the internal and external environment around the business; is the work of the managers of the business; and is communicated to all the business stakeholders, both inside and outside of the company. It should be well crafted and should have some value. A Strategic Goal should be backed by a plan for accomplishing it. This does not mean high level initiatives or milestones, but an actual step by step plan for achieving the goal. Apart from that there should be some metrics to measure the progress and to check whether the execution is on track. For e.g. If a company has a Strategic Goal to become a billion dollar company in 5 years, it should track the progress year-on-year. This will help in identifying whether the company is on the right path. If you do not measure the progress, the plan is more likely to fail.

2. Importance of Strategic Plan


Strategic planning can be a challenging process, particularly the first time it is undertaken in a company. With patience and perseverance as well as a strong team effort the strategic plan can be the beginning of improved and predictable results for a company. At times when the business gets off track a strategic plan can help direct the recovery process. When strategic planning is treated as an ongoing process it becomes a competitive advantage and an offensive assurance of improved day to day execution of the business practices.

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Use of an outside, independent facilitator can help in the process and in the development of a strategic plan. An outside resource can provide objectivity and serve as a devils advocate as well as a sounding board for the management charged with plan development. In the final analysis the plan must have the authorship and ownership of the owner and the managers who must execute and follow the strategic plan. It must be their plan.

3. Characteristics of a Strategic Plan


The strategic plan, to be of real long-term value, must be treated as an ongoing business process. It must be reflective of the owners mission and vision. It must evolve and change to reflect changing market and economic conditions. It must be proactive to competitive, market and economic conditions. If those steps are followed, the strategic plan will institutionalize a culture of continuous improvement and disciplined change. a. Clarity A strategic plan should convey its message in simple terms. If it is complex and complicated, it will be pushed to the back when something simple and immediate is pressing every day. Employees must clearly know the strategic direction, goals and priorities b. Format A strategy plan contains goals and processes for the different parts of an organization. For big organizations, the strategy percolates from the top to various functions. In such a case the Plan should not look like a compilation of many strategies. Each company should form a style for their strategy plan and should follow it. c. Distribution Strategy Plan is a confidential document and should not be freely distributed to all the levels. It should be accessible to all the managers who are responsible for communicating the actions to their teams. It should also be available with all the stakeholders who have given inputs or have participated in the strategy formulation. d. Objectives A strategic plan must have a list of all the objectives that the company is striving for. Each objective should be properly numbered and described. A company might be aiming at one or more improvements in their working. Each some goal should have a mention in the strategic plan. e. Resources To achieve any objective, some resources are required. These should be clearly mentioned in the strategic plan. If the resources mentioned in the plan are not provided the plan may go of the track. A plan should have all details of the resources, like availability, specifications, duration, etc. This will help the stakeholders in progressing to achieve the assigned objective.

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f. Time Each goal is mapped to time duration. A time frame is defined for meeting the goal. This should be present in the strategic plan. This helps us in deciding whether the objective is successful or has failed. All objectives/goals are not met during the same time frame. If you want to execute the plan, assign people and follow-up regularly. Review of the Plan is very important.

4. Contents of a Strategic Plan


The strategic plan is a tightly developed, concise document that can then be shared with a Board and with the employees of an organization. This should generally not require more than 2-5 pages, and consists of the following: a. SWOT analysis (Assessment of current business environment) b. Vision c. Mission (may also include core values) d. Critical success factors e. Overall organizational performance measures f. Core Strategies External and Internal g. Performance measures for each strategy h. Major resource deployment decisions i. Assignment of strategic responsibilities j. High level macro implementation schedule k. Monitoring and control system

5. Common reasons for failure of Strategic Plan


There are several reasons why strategic plans are not developed properly, or not implemented properly. Among the most common are: a. Senior management does not follow a defined process to accomplish this task. As a consequence, months of effort are wasted in creating reams of paper that do not have strategic import. b. The process is delegated to a planning group, or assigned to the various functional leaders to complete for their respective areas. If completed in individual functional areas, the plan may work for individual departments, but is likely to sub-optimize the whole organization. If assigned to a planning group, the result is often not truly embraced and endorsed by senior leadership. c. Senior management does not set aside the time to develop the strategic plan as a collective team work product. d. The organization does not understand what a strategic plan is actually designed to provide. Therefore, the strategic plan is a tactical business plan with multiple year extrapolations. There is very little about it that addresses actual strategic direction.

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e. Senior management does to follow a defined process or methodology that will result in a strategic plan in a timely and efficient yet comprehensive manner. f. The plan is developed but there is no process to communicate it throughout the organization and build organization-wide alignment to its implementation. g. The plan is developed with no implementation guidelines at all. At best, it is implemented in pieces. At worst, it is unfunded and ignored. This does not have to become the reality. Strategic plans can be developed in an efficient and timely manner as long as the senior management team of an organization is committed to meeting and working together over a period of several months to develop it.

6. Conclusion
A strategic plan is a guiding document which contains the goals and the path to achieve it. It also contains the measures to check whether a goal is achieved or not. The monitoring and control system of this plan should be strong enough to identify a non-profitable plan and scrap it before it cause huge losses.

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