In an ever-changing world, strategic planning Strategic Planning Tools for Analysis

is a vital process for helping organisations [1] SWOT Analysis

understand the world in which they operate and SWOT analysis is one of the oldest and most
how it is changing so that they can focus on widely used strategic planning tools. SWOT
those things most likely to lead them to future stands for Strengths, Weaknesses,
success. Opportunities and Threats. Its elegant simplicity
is both its greatest strength and weakness, as a
But strategic planning can be confusing. There result it often best used in conjunction with some
are so many tools, models, frameworks and of the other models mentioned below. It is
theories around it can be difficult to know when particularly useful as a starting point, in order to
to start. work out where to focus your analytical efforts,
as well as a summary of the analysis before
In this post, we outline the most essential tools moving on to decision-making and direction-
for strategic planning and how they fit together. setting. (See What is a SWOT analysis?)

How it all fits together [2] PESTEL Analysis

Strategic planning is a combination of four PESTEL analysis is a macro-scanning tool - that
different activities, which can further be is, it helps you to scan the environment for
subdivided into two sub-categories: relevant trends. These trends can then inform
the Threats and Opportunities on your SWOT
Strategy Development - what should the analysis. PESTEL stands for Political,
organisation focus on, and why? Economic, Social (or socio-economic),
• Analysis: Before developing a strategy it is Technological, Environmental, and Legal (and
important to develop a shared understanding regulatory). These are the six domains to scan
of the industry in which a business operates for relevant trends. (See How to do PESTEL
and its relative strengths and weaknesses. Analysis)
The industry in which it operates includes its
customers, distributors, partners and [3] Porter's 5 Forces
suppliers, competitors, regulators, Porter's 5 forces is a framework for
governments/politicians, etc. Its strengths understanding the factors which might make an
and weaknesses are relative to its industry more or less attractive. The 5 Forces are
customers' needs and its competitors' the bargaining power of suppliers, the bargaining
capabilities. power of customers, the threat of substitutes, the
• Decision-making and direction-setting: threat of new entrants to the industry, and the
Armed with that understanding the next step intensity of rivalry between players in the
is to choose what the organisation will focus industry. Industries in which those forces are
on and priorities. This is often called strong are likely to be less attractive, because
choosing where to play and how to win. profit margins are likely to be narrower and
Where to play can be defined in terms of growth harder to achieve. Like the PESTEL
which markets to compete in, which analysis, Porter's 5 Forces is also useful for
customers to target, and where to play within highlighting Threats and Opportunities on your
the industry value chain. How to win can be SWOT analysis. (See How to do a Porter 5-
defined in terms of what the organisation Forces analysis)
needs to have or be able to do uniquely well
(or at least better than the competition) to [4] McKinsey 7S
succeed in those markets. The McKinsey 7S framework looks at the degree
of alignment between the 7 organisational
Strategy Execution factors within an organisation (which all happen
• Planning: Planning entails working out to begin with an S). These are further divided into
exactly how you will execute the decisions hard factors like Strategy, Systems and
you made above. Crucially, it entails Structure, and soft factors like Style, Staff, Skills
mapping out who will do what and when, as and Shared values. It is important to understand
well as how much it will cost. not only how the organisation addresses each of
• Tracking results: Often overlooked, it is the 7 categories, but, possibly more importantly,
vital to track progress both of your plans (are the extent to which their is alignment between
you doing what you said you would do within them. As these factors are more internal,
the costs and timeframes you'd planned?) McKinsey 7S is useful for identifying Strengths
and outcomes (is your strategy having the and Weaknesses on your SWOT analysis. (See
intended effect)? If the answer to either of Using the McKinsey 7S Framework to assess
those questions is 'no' you may need to go strategic alignment, strengths and weaknesses)
back to the drawing board and adjust your
strategy. [5] Porter's Value Chain
Porter's Value Chain is a simple way of
Where to find the tools describing how value is added. When applied to
an organisation, it simply describes the key
What's more, they're all collaborative, integrated organisation capabilities, dividing them between
and powered by AI to help you drive strategic the primary functions which turn acquire inputs,
insight, and develop, execute and adapt your turn them into outputs and deliver them to
plans more effectively. customers, and supporting functions like
finance, HR and infrastructure management.
With free and paid plans, you can be up and When applied to an industry, it can also be used
running in minutes. Why not start now? to describe the broader supply chain, and the
role different organisations play within that things, against too much emphasis on one
supply chain. (See Value Chain Analysis) aspect of a business at the expense of others
leading to unintended consequences. (See The
[7] Business Model Canvas Balanced Scorecard)
The Business Model Canvas is a more recent
way of describing how a business works which [17] Shared Values
has become very popular. It's a great tool for Values describe what is important to an
summarising how a business works across all organisation regardless of its strategy. They
functions. As such it can be a helpful starting represent the lines you can't paint outside of.
point when getting people together from across They can be negatives - things you wouldn't do
different silos to take a more holistic view of an no matter how profitable they are - or positives -
organisation and its strategy. There are a things you believe to have intrinsic, self-evident
number of alternative canvases that have since value. (See Corporate shared values)
sprung up: the most popular of these is probably
the Lean Canvas, which targets early-stage [18] The Strategy House
startups. (See The Business Model Canvas) The strategy house is a visual representation of
a strategy in which the shared values are shown
[8] Boston Consulting Grid (BCG)/Matrix as the foundations, the vision or mission is
If your business consists of more than one shown as the roof, and the strategy is shown as
product or service, the Boston Consulting Grid (usually) 3 to 4 pillars which rest on the
help you understand the nature of each and the foundations and hold the roof up. The pillars
different strategic options which might be represent themes and typically include a
suitable for each. (See The BCG Matrix) combination of goals and strategic initiatives.
The inclusion of strategic initiatives means the
[9] Pareto Analysis strategy house acts as a bridge from direction
The Pareto principle states that 80% of effects setting to planning. (See The Strategy House)
arise from 20% of causes. You can apply this in
many situations. Especially to understand which Strategic Planning Tools for Planning
of your products or services drive your profits [19] The 3 Horizons model
and which may be loss leaders. (See Pareto The 3 Horizons model classifies activities as
Analysis) relating to maintenance and improvement of the
current, expansion and growth into new areas,
Strategic Planning Tools for Decision- and transformation into something new and
making and Direction-setting different. It helps organisations to avoid
[12] Mission Statement becoming too focused on immediate threats and
A mission statement describes why an opportunities at the expense of the future, whilst
organisation exists. What is its purpose? What also avoiding becoming too focused on a future
would the world miss if it ceased to exist? (See it might not survive to see.
Mission and Vision Statements)
[20] The Ansoff Matrix
[13] Vision Statement The Ansof Matrix focuses specifically on growth,
A vision statement describes what the distinguishing between growth within existing
organisation and the world in which it operates products and markets, growth into new markets,
would look like if it were completely successful in growth by adding new products or services, and
its mission and strategy. It should paint a clear growth by doing both (the riskiest of all!) helping
and vivid picture of an ideal future. With the you to understand the different requirements and
mission statement, it should inspire those who balance the risks of each. (See Planning for
work there, and encourage others to want to do growth with Ansoff's Matrix)
business with the organisation. (See Mission and
Vision Statements) [21] RASCI
RASCI is a framework for assigning
[14] the Strategy Triad and [15] Strategy responsibility to individuals as being
Alternative Matrix (SAM) Responsible for getting it done, Accountable for
From Peter Compo's book, the "Emergent the outcomes, Supportive, Consulted, or merely
Approach to Strategy", these tools help you to kept Informed. It provides a way of ensuring full
identify and solve the dominant bottleneck in participation without allowing "too many cooks to
your strategy. (See The Strategy Triad and The spoil the broth". (See The RASCI framework)
Strategy Alternative Matrix)
[22] Kanban or Ideas Funnel
[16] The Balance Scorecard/Strategy Map Kanban or an Ideas Funnel is a visual
The balanced scorecard is a technique for representation of how individual ideas get moved
mapping out an organisation's strategy goals, from inception through to different to completion
objectives and KPIs in 4 different perspectives: and all stages in between. It provides insight into
financial, customer, internal business process, the different processes and governance required
and learning and innovation. The strategy map for ideas at each stage on that journey
implies a causal relationship between these
perspectives: the learning an innovation [23] Gantt Chart
perspective creates the capability required to The Gantt Chart is borrowed directly from the
improve internal business processes; internal project management discipline. It shows when
business processes are what delivers value to you will do what you plan to do, with time shown
customers; and delivering value to customers across the top (x-axis) and each activity shows
drives financial results. The 'balance' in a as a bar from its start to end date, making it easy
balanced scorecard ensures, amongst other to represent sequence, concurrency and
dependency between activities. (See Using the
Gantt chart view) What are some essential tools for strategic
analysis?
[24] RAID log Essential tools for strategic analysis include
Another model borrowed from project SWOT Analysis, PESTEL Analysis, Porter's 5
management, the RAID log lists out, and Forces, McKinsey 7S, Porter's Value Chain,
categorises the Risks, Actions, Issues and Business Model Canvas, Boston Consulting
Decisions inherent in your strategy execution Group (BCG) Matrix, Pareto Analysis, Strategy
plan. (See The RAID Log) Canvas, and Scenario Analysis.

[25] Status Report What tools assist in decision-making and

A status report tracks whether people are doing direction-setting?
what they are supposed to do. It lists all the key Tools that assist in decision-making and
strategic initiatives with projected completion direction-setting include Mission and Vision
dates, Red/Amber/Green traffic lights indicating Statements, the Strategy Triad, Strategy
status, and supporting notes, allowing an Alternative Matrix (SAM), Balanced
organisation to decide what is on track and Scorecard/Strategy Map, Shared Values, and
where some form of intervention or change is the Strategy House.
required. (See The Initiative Status Report)
Which tools are useful for strategic
Strategic Planning Tools for Tracking planning?
Results Useful tools for strategic planning include the 3
[26] Strategy Scorecard Horizons Model, Ansoff Matrix, RASCI, Kanban
A strategy scorecard tracks whether your or Ideas Funnel, Gantt Chart, RAID Log, and
strategy is delivering the intended outcomes or Status Report.
whether an adjustment is required. It typically
shows the performance of each strategic KPI as How can organisations track strategic results
a line chart with a common horizontal time axis. effectively?
Variances on the scorecard are typically fed Organisations can track strategic results
back into the Analysis phase so that the cycle effectively using tools like the Strategy
can be repeated. (See Creating a Strategy Scorecard and KPI Correlation Matrix.
Scorecard on StratNavApp.com)
Where can these strategic planning tools be
[27] KPI correlation matrix found?
A KPI correlation matrix calculates the All these tools are available in StratNavApp.com,
correlations between pairs of KPIs. This is used a collaborative, integrated, and AI-powered
to test for and confirm hypothesised cause and platform that helps drive strategic insight and
effect relationships inferred from the strategy develop, execute, and adapt plans more
map (see Balanced Scorecard above). The effectively.
correlation calculations may need to allow for
delays between causes and effects. (See
Correlations between your Performance GROUP 1
Indicator Results) STRATEGIC ANALYSIS AND DECISION

Linking them all together Strategic Process - The strategy process is a

You probably wouldn't use all of these tools in structured approach that organizations follow to
every strategy. But you will at least need to use develop and execute strategies for achieving
several. long-term goals. It consists of four key stages:

And to develop and execute a coherent strategy 1. Strategic Analysis (Understanding the
you will need to integrate and link them together Environment) Organizations assess internal
so that information flows through them in a strengths and weaknesses and external
logical way and your strategy remains internally opportunities and threats using tools like SWOT,
consistent. PESTEL, and Porter’s Five Forces.

You can do this manually, of course. But it 2. Strategy Formulation (Developing the Plan)
quickly becomes quite onerous and errors creep Organizations define their goals and select the
in. That's where a tool like StratNavApp.com best strategy to compete effectively.
comes into its own. It will ensure that logical flow
of information and internal consistency for you. 3. Strategy Implementation (Executing the Plan)
Leaving you to focus on the higher value-add The organization allocates resources, aligns
activity of generating strategic insights and teams, and puts the strategy into action.
translating those into focused action that delivers
tangible results. 4. Strategy Evaluation & Control (Measuring
Success & Adapting) Performance is monitored,
How does strategic planning fit together? and necessary adjustments are made based on
Strategic planning combines four activities: customer feedback and sales data.
Analysis (understanding the industry and
organisational strengths and weaknesses), Strategic models - Strategic models help
Decision-making and Direction-setting (choosing businesses analyze their environment, set goals,
focus areas and priorities), Planning (mapping and develop competitive strategies. Here are
out execution details), and Tracking Results some widely used strategic models:
(monitoring progress and outcomes).
1. SWOT Analysis (Strengths, Weaknesses,
Opportunities, Threats) Purpose: Evaluates Example: A company discourages risk-taking,
internal strengths and weaknesses and external preventing employees from suggesting new
opportunities and threats. business ideas.

2. Porter’s Five Forces Model Purpose: Analyzes 4. Employee Skill Gaps and Workforce Issues-
industry competitiveness by assessing: Lack of trained personnel can slow down
strategic implementation.
• Competitive Rivalry (existing competitors)
• Threat of New Entrants (ease of new Example: A business expands globally but lacks
competitors entering) employees with international business expertise.
• Bargaining Power of Suppliers (control
over pricing and resources) 5. Employee Skill Gaps and Workforce Issues-
• Bargaining Power of Buyers (customer Lack of trained personnel can slow down
influence on prices) strategic implementation.
• Threat of Substitutes (alternative
products/services) Example: A business expands globally but lacks
employees with international business expertise.
3. Ansoff Matrix Purpose: Helps businesses
decide growth strategies by choosing between: 6. Financial Constraints- Limited funding can
restrict business expansion and innovation
Market Penetration (sell more in the existing efforts.
market) Market Development (expand to new
markets) Product Development (introduce new Example: A startup with a strong business model
products) Diversification (enter completely new fails to scale due to lack of investment.
industries)
7. Inefficient Operational Processes- Outdated
4. Balanced Scorecard (BSC) Purpose: systems, poor supply chain management, or
Measures strategy success across four workflow inefficiencies can slow down progress.
perspectives:
Example: A manufacturing company
Financial Performance (profits, revenue growth) experiences frequent delays due to an outdated
Customer Satisfaction (brand loyalty, service inventory system.
quality) Internal Processes (operational
efficiency) Learning & Growth (employee 8. Lack of Innovation and Adaptability-
development, innovation) Companies that fail to innovate risk losing their
competitive edge.
5. PESTEL Analysis (Political, Economic, Social,
Technological, Environmental, Legal) Purpose: Example: A retail store refuses to adopt e-
commerce, losing customers to online
Evaluates macro-environmental factors affecting competitors.
a business.
9. Conflict Among Employees or Departments
Challenges in Internal Environment Internal conflicts can reduce productivity and
disrupt strategic goals.
The internal environment refers to all factors
within an organization that influence its Example: A company's sales and product
operations, decision-making, and overall development teams blame each other for
success. These factors are controllable and can declining revenue.
be managed to improve performance and
achieve strategic goals. 10. Weak Performance Measurement and
Strategy Evaluation Lack of tracking and
Here are the internal challenges: feedback mechanisms can lead to poor decision-
making.
1. Leadership and Decision Making Issues- Poor
leadership can lead to ineffective strategies and Example: A business does not measure the
lack of direction. impact of its marketing strategies, leading to
wasted resources.
Example: A CEO makes abrupt changes in
strategy without proper analysis, causing How to Overcome These Challenges:
confusion among employees. ✔ Foster strong leadership and decision-making
skills.
2. Resistance to Change- Employees may resist ✔ Build a positive and adaptable company
new strategies, technologies, or structural culture.
changes. ✔ Invest in employee training and development.
✔ Improve communication and cross-
Example: A company shifting to remote work department collaboration.
struggles because employees prefer traditional
✔ Ensure financial stability and efficient resource
office settings.
allocation.
3. Organizational Culture Misalignment- A
Challenges in External Environment - The
negative or rigid corporate culture can hinder
external environment refers to all outside factors
innovation and adaptability.
and forces that influence an organization's
operations, decisions, and performance. These Example: A smartphone company faces delays
factors are uncontrollable and can create due to a semiconductor chip shortage.
opportunities or pose threats to the business.
How Businesses Can Overcome These
Here are the external challenges: Challenges:
✔ Conduct PESTEL analysis to monitor external
1. Political Instability & Government trends.
Regulations – Changing government policies, ✔ Develop flexible strategies to adapt to
trade restrictions, or taxation laws can disrupt changes.
business operations.
✔ Invest in innovation and technology to stay
competitive.
Example: A company faces increased tariffs,
raising production costs. ✔ Maintain strong risk management for
economic uncertainties.
2. Economic Uncertainty – Inflation, exchange ✔ Build sustainable and ethical business
rates, and recessions can affect purchasing practices.
power and business profitability.

Example: A global recession leads to lower

consumer spending on luxury goods.

3. Changing Consumer Preferences – Shifts in

customer behavior and trends can impact
product demand.

Example: Consumers move towards plant-

based diets, affecting meat producers.

4. Technological Disruptions – Rapid

technological advancements can make existing
products or services obsolete.

Example: Traditional taxi services struggle to

compete with ride-hailing apps.

5. Competitive Pressure – Intense competition

can reduce market share and force businesses
to innovate constantly.

Example: A small retailer struggles to compete

with e-commerce giants like Amazon.

6. Legal & Regulatory Compliance – New laws

related to data protection, labor, or industry
regulations can increase costs and risks.

Example: Social media platforms must adjust

their policies to comply with stricter data privacy
laws.

7. Social & Cultural Changes – Shifts in

societal values, diversity, and inclusion
expectations affect business reputation and
strategies.

Example: Companies adopt ethical sourcing

practices due to consumer demand for
sustainability.

8. Environmental & Sustainability Issues –

Climate change, pollution control, and
sustainability demands can affect business
operations.

Example: Stricter emissions laws force

automakers to invest in electric vehicles.

9. Globalization & Trade Barriers –

International trade restrictions, tariffs, and supply
chain disruptions can impact businesses.