Making a business strategy that is in line with the values and vision of the company can often be difficult for managers and CEOs. While companies differ from their rivals in terms of the amount of resources and working capital they have deployed, there often is a temptation to pursue projects at face value without considering the implications it has for your business or its challenges.
For this reason, strategic planning offers firms a crucial prerequisite for formulating accurate strategic goals and objectives that add value to your business.
Why is strategic planning important for your business?
Strategic planning is extremely important for analyzing your business landscape and helping you to pursue activities that are in accordance with the strategic aims and objectives. It helps to serve as an important roadmap of activities and as a criterion for efficient or poor utilization of resources.
A strategic plan helps to take into account the following considerations:
1. The current position of the business – this looks at the internal capabilities and resources, its strengths and weakness, the competitive position of the firm, and how profitable it is at the moment.
2. The future direction and vision of the business – this helps to explore how the business seeks to fulfill its mission, goals and objectives in line with future possibilities, threats and changes.
3. How the firm can accomplish its vision – this pertains to the resources, skill-set, capabilities and competencies the firm requires in translating its vision and direction into tangible financial and non-financial results.
Key elements of strategic planning
A successful strategic plan is only as effective as its parts. Following constituents that are essential in making an effective strategic plan.
Mission statement
The most important element to consider is the company’s mission statement. A mission statement defines what the organization is and what they stand for. It also includes the core goals and objectives.
Company vision
A company’s vision is a brief outline of what the organization seeks to accomplish as an enterprise. It denotes an aspiration of what the company seeks to become in the coming years or how it seeks to beat the competition.
Values
The values of an organization form part and parcel of its overall personality which determines how it operates and what it seeks to uphold and instill in its workforce culture. Simply put, values are what define the company.
Goals and objectives
Goals are outlined methods of achieving the company’s mission and vision. Objectives on the other hand, are time bound and realistic strategies to achieve the goals.
Tasks
This involves a series of broad based activities that can be assigned to each department. These should be clear and concise enough to serve as an overall guideline for each department.
Implementation strategy
After the overall goals, objectives and tasks are outlined, the organization needs to make an implementation strategy regarding how it seeks to execute the various activities, what kind of resources and funding is required for its completion and what manpower is required.
Strategic plan evaluation
It is also essential that the organization make a periodic evaluation of its implementation strategy to constantly keep on track of its overall goals and objectives. This will help to identify the strengths and areas of improvement that will force team members to be more efficient.
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