STRATEGIC PLANNING

Strategic planning is the process of documenting and

establishing a direction of your small business—by
assessing both where you are and where you’re going.
The strategic plan gives you a place to record your
mission, vision, and values, as well as your long-term
goals and the action plans you’ll use to reach them. A
well-written strategic plan can play a pivotal role in your
small business’s growth and success because it tells
you and your employees how best to respond to
opportunities and challenges.

Benefits of Strategic Planning

The strategic planning process can take some time, but it’s beneficial for
everyone involved. As the small business owner, you’ll have a better idea of the
goals and objectives you want to accomplish and a path to do that. For your
employees, the process can foster an increase in productivity—contributing to
the success of the business.

The Strategic Planning Process

When it comes to the strategic planning process, think of it as having three
phases: discussion, development, and review and updating. The goal of the
strategic planning process is to ensure everyone in the business is aligned
when it comes to your small business’s goals and objectives, as well as to
create a formal strategic plan document

The pre-planning stage is often overlooked

in terms of importance to the overall project.
However, pre-planning is where the project is
defined:

 The team is set up;

 Deliverables are established;
 GANTT charts are drawn; and
 Activities are delegated.

Seeing as how the entire project flows from this, it’s hard to believe why this
stage is often overlooked or rushed through. In the excitement of getting a

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 project underway, achieving deliverables, and enjoying results, teams may
lose sight of how to properly plan and execute on the project. This can lead to
increased frustration, delays, overruns, and reduced team morale
.
Pre-planning can include a wide array of project-related activities – it doesn’t
just need to be team identification, goals/deliverables establishment,
budgeting, and scheduling. Pre-planning can (and should in most cases)
include a range of other activities. This includes things like reviewing a needs
assessment, conducting a ‘desirable and viable’ analysis (i.e. is the project
outcome desirable/good for the business and is it realistic?), review existing
processes/products/services, review of previous projects, rough timeline
definition, and early stakeholder engagement.

Human Resource Management performs

organizational assessments for departments and
schools. An assessment can help you identify key
issues and opportunities that can improve your
organization's overall effectiveness. We utilize a variety
of tools to conduct our evaluations, including
interviews and surveys.

An organizational assessment provides a comprehensive look at how well

an organization is performing at a designated point in time, reviews the
strengths and challenges of the organization and determines if they are
headed in the right direction. Assessments can be the catalyst for planned
change, can motivate a sluggish board, and are an excellent document to
share with funders to build the case for support.

Mission

An organization’s mission statement describes clearly and concisely why

the organization exists – its purpose. The mission statement defines what is
important to the organization and guides the organization’s decisions and
activities.

The mission statement answers three (or sometimes four) basic questions
about the organization:

1. Whom does the organization serve?

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 2. What does the organization do?

3. Why does the organization do it?

4. [Optional] How does the organization do it?

Vision

A vision statement is a statement of an organization’s overarching

aspirations of what it hopes to achieve or to become.

Here are some examples of vision statements:

1. Disney: To make people happy

2. IKEA: To create a better everyday life for the many people
3. Microsoft: Empower every person and every organization on the planet
to achieve more
4. Avon: To be the company that best understands and satisfies the
product, service and self-fulfillment needs of women—globally
5. Sony Corporation: To be a company that inspires and fulfills your
curiosity[1]

The vision statement does not provide specific targets. Notice that each of
the above examples could apply to many different organizations. Instead, the
vision is a broad description of the value an organization provides. It is a visual
image of what the organization is trying to produce or become. It should
inspire people and motivate them to want to be part of and contribute to the
organization. Vision statements should be clear and concise, usually not
longer than a short paragraph.

A guiding principle is a positive, general principle that

becomes an important foundation for the conduct of
behavior, both individually and in relationships with others.
Guiding principles are beliefs that most people would agree
with because they are viewed as socially appropriate and
inherently valuable, such as the idea to "be responsible."
Guiding principles are qualities that are naturally viewed as
leading to higher level functioning, creating positive
relationships with others, and promoting a civil society.

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 The 12 Guiding Principles

 Adaptability - means how quickly organizations adjust their business

processes and improvise themselves to achieve their goal. The ability and
willingness to change.
 Compassion - a feeling of deep sympathy and sorrow for another who is
stricken by misfortune, accompanied by a strong desire to alleviate the
suffering. The desire to help others in distress. To show kindness and
concern for others in distress by offering help whenever possible.
 Contemplation - Giving serious consideration to something. To think
things through with proper care before taking action.
 Courage - Bravery. The willingness to put one's beliefs into practice, the
capacity to meet danger without giving way to fear. To face difficulty or
danger and express your beliefs even if you are afraid.
 Honesty - Truthfulness, sincerity. The act or condition of never deceiving,
stealing, or taking advantage of the trust of others. To be truthful in all that
you do and never deceive, steal, or take advantage of the trust of others.
 Initiative - Eagerness to do something. To take responsible action on your
own, without prompting from others.
 Loyalty - Faithfulness, dependability. The quality of being faithful to
another person in the performance of duty; adhering to a contract with
another person. To show others that you are dependable when you have a
commitment to them.
 Optimism - Positive beliefs. The inclination to take a hopeful view or think
that all will work out for the best. To strive to be positive in your beliefs
about yourself, others, and the future.
 Perseverance - Hard work. The quality of trying hard and continuously in
spite of obstacles and difficulties.
 Respect - Regard, value, admire, appreciate. Special esteem or
consideration in which one holds another person or thing. To show regard
for yourself, others, and the world around you.
 Responsibility - Accountability. To consider oneself answerable for
something. To demonstrate that you consider yourself to be accountable
for your actions and that you follow through on your commitments.
 Trustworthiness - Reliability. Dependable, deserving of trust and
confidence.

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 Gap analysis is a technique of asset-liability
management that can be used to assess interest
rate risk or liquidity risk. Implementations for
those two applications differ in minor ways, so
people distinguish between interest rate gaps and
liquidity gaps. When used to manage interest rate risk, it was used in tandem
with duration analysis. Both techniques have their own strengths and
weaknesses.

A gap analysis:

 Identifies the differences between the workforce an agency has currently

and the workforce it will need in the future, based on its operational goals.
 Will reveal gaps in competencies and staffing levels to carry out future
functional requirements of the organization.
 Builds the foundation for the Gap-Closing Strategies step of the Workforce
Planning process.

Strategic Goals and Strategies

Planners carefully come to conclusions about what the organization must

do as a result of the major issues and opportunities facing the organization.
These conclusions include what overall accomplishments (or strategic goals)
the organization should achieve, and the overall methods (or strategies) to
achieve the accomplishments. Goals should be designed and worded as
much as possible to be specific, measurable, acceptable to those working to
achieve the goals, realistic, timely, extending the capabilities of those working
to achieve the goals, and rewarding to them, as well. (An acronym for these
criteria is "SMARTER".)

Objectives

Objectives are usually specific statements (they are actually a particular

kind of goal) that contribute to the achievement of "bigger" goals. In other
words they are actually goals, but they are more specific. Another term for
objectives within a strategic planning framework is to call these "enabling
goals", since, if you hit all your objectives, they will contribute to the
achievement of the larger strategic goal(s), they enable. In strategic planning
all parts of the process is important, but perhaps the most important part

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 involves developing your strategic, corporate goals, objectives and business
goals. Much of the analysis you do in strategic planning is designed to help
you develop achievable goals that reflect the business realities in your sector
and environment.

A gap analysis is process that compares actual performance or results with what
was expected or desired. The method provides a way to identify suboptimal or
missing strategies, structures, capabilities, processes, practices, technologies or
skills, and then recommends steps that will help the company meet its goals.
Given this definition, as a first-time administrator, you were assigned to conduct
gap analysis.

 Follow the schedule that you have prepared. Go into each area of the
facility to evaluate the current quality system.

 Focus on what is in place, and what is not in place. Remind auditors

that you are not focusing on compliance or non compliance to the
current system, but on the design of the current system, and how it
matches the ISO 9001:2000 requirements.

 Take notes on what is in place, and what will need to be developed

and changed. Take complete notes, reference documents and
examples.

One strategic planning client had a unique product with an overwhelming market
share. They had concern as to their ability to maintain their competitive
advantage in the face of competitors who eventually could be able to legally
replicate their processes. For them – the solution was to identify organizations
interested in acquiring their technology. Targets were identified with the help of
investment bankers. The result – a successful business sale. The substantial
financial rewards enabled the founders to set up a charitable
foundation. Strategic planning identified the product life cycle and allowed the
client to maximize the strategic opportunity.

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 Step One - Preparation

To get ready for strategic planning, an organization

must first assess if it is ready. While a number of
issues must be addressed in assessing readiness, the
determination essentially comes down to whether an
organization's leaders are truly committed to the effort, and
whether they are able to devote the necessary attention to the "big
picture". For example, if a funding crisis looms, the founder is
about to depart, or the environment is turbulent, then it does not
make sense to take time out for strategic planning effort at that
time. The product developed at the end of the Step One is a
Workplan.

Step Two – Formulation of Mission and Vision

A mission statement is like an introductory paragraph: it

lets the reader know where the writer is going, and it also
shows that the writer knows where he or she is going.
Likewise, a mission statement must communicate the
essence of an organization to the reader. An organization's
ability to articulate its mission indicates its focus and purposefulness.
Whereas the mission statement summarizes the what, how, and why of an
organization's work, a vision statement presents an image of what success
will look like. With mission and vision statements in hand, an organization has
taken an important step towards creating a shared, coherent idea of what it is
strategically planning for. At the end of Step Two, a draft mission statement
and a draft vision statement is developed.

Step Three – Assessment

Once an organization has committed to why it exists and

what it does, it must take a clear-eyed look at its current
situation. Remember, that part of strategic planning,
thinking, and management is an awareness of resources
and an eye to the future environment, so that an
organization can successfully respond to changes in the environment.
Situation assessment, therefore, means obtaining current information about
the organization's strengths, weaknesses, and performance - information that
will highlight the critical issues that the organization faces and that its
strategic plan must address. These could include a variety of primary

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 concerns, such as funding issues, new program opportunities, changing
regulations or changing needs in the client population, and so on. The point is
to choose the most important issues to address. The Planning Committee
should agree on no more than five to ten critical issues around which to
organize the strategic plan.

The products of Step Three include: a data base of quality information that
can be used to make decisions; and a list of critical issues which demand a
response from the organization - the most important issues the organization
needs to deal with.

Step Four - Formulate Strategies, Goals, and Objectives

Once an organization's mission has been affirmed and its

critical issues identified, it is time to figure out what to do
about them: the broad approaches to be taken (strategies),
and the general and specific results to be sought (the goals
and objectives). Strategies, goals, and objectives may come
from individual inspiration, group discussion, formal
decision-making techniques, and so on - but the bottom line is
that, in the end, the leadership agrees on how to address the critical issues.
This can take considerable time and flexibility: discussions at this stage
frequently will require additional information or a reevaluation of conclusions
reached during the situation assessment. It is even possible that new insights
will emerge which change the thrust of the mission statement. It is important
that planners are not afraid to go back to an earlier step in the process and
take advantage of available information to create the best possible plan.

The product of Step Four is an outline of the organization's strategic

directions - the general strategies, long-range goals, and specific objectives of
its response to critical issues.

Step Five – Finalization of the Written Plan

The mission has been articulated, the critical issues

identified, and the goals and strategies agreed upon. This
step essentially involves putting all that down on paper.
Usually one member of the Planning Committee, the
executive director, or even a planning consultant will draft
a final planning document and submit it for review to all
key decision makers (usually the board and senior staff). This is also the time
to consult with senior staff to determine whether the document can be
translated into operating plans (the subsequent detailed action plans for

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 accomplishing the goals proposed by the strategic plan) and to ensure that
the plan answers key questions about priorities and directions in sufficient
detail to serve as a guide. Revisions should not be dragged out for months,
but action should be taken to answer any important questions that are raised
at this step. It would certainly be a mistake to bury conflict at this step just to
wrap up the process more quickly, because the conflict, if serious, will
inevitably undermine the potency of the strategic directions chosen by the
planning committee

 ASSESSMENT

 These include environmental scanning, background

information, situational analysis and SWOT.

 BASELINE

 These include the situation-past, present and the future,

significant issues, align/fit with capabilities and gaps.

 COMPONENTS

 These include the mission and vision, values/guiding

principles, major goals and specific objectives.

 DOWN TO SPECIFICS

 These include performance evaluation, targets/standards of

performance, initiatives and projects and action plans.

 EVALUATE

 These include performance management, review progress-

balanced scorecard, take corrective actions and feedback
upstream-revise plans.

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 Develop related strategies (tactical and operational).
Tactical plans are based on the organization's strategic
plan. In turn, operational plans are based on the
organization's tactical plans. These are specific plans that
are needed for each task or supportive activity comprising the whole.
Strategic, tactical, and operational planning must be accompanied by
controls. Monitoring progress or providing for follow-up is intended to assure
that plans are carried out properly and on time. Adjustments may need to be
made to accommodate changes in the external and/or internal environment
of the organization. A competitive advantage can be gained by adapting to
the challenges.

Action Plans

Top level managers set very general, long-term goals

that require more than one year to achieve. Examples of
long-term goals include long-term growth, improved
customer service, and increased profitability. Middle
managers interpret these goals and develop tactical
plans for their departments that can be accomplished
within one year or less. In order to develop tactical plans, middle management
needs detail reports (financial, operational, market, external environment).
Tactical plans have shorter time frames and narrower scopes than strategic
plans. Tactical planning provides the specific ideas for implementing the
strategic plan. It is the process of making detailed decisions about what to
do, who will do it, and how to do it.

Operational Plans

Supervisors implement operational plans that are

short-term and deal with the day-to-day work of their
team. Short-term goals are aligned with the long-term
goals and can be achieved within one year.
Supervisors set standards, form schedules, secure
resources, and report progress. They need very
detailed reports about operations, personnel, materials, and equipment. The
supervisor interprets higher management plans as they apply to his or her
unit. Thus, operational plans support tactical plans. They are the supervisor's
tools for executing daily, weekly, and monthly activities. An example is a

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 budget, which is a plan that shows how money will be spent over a certain
period of time. Other examples of planning by supervisors include scheduling
the work of employees and identifying needs for staff and resources to meet
future changes. Resources include employees, information, capital, facilities,
machinery, equipment, supplies, and finances.

Operational plans include policies, procedures, methods, and rules. The terms
themselves imply different degrees of scope. A policy is a general statement
designed to guide employees' actions in recurring situations. It establishes
broad limits, provides direction, but permits some initiative and discretion on
the part of the supervisor. Thus, policies are guidelines.
A procedure is a sequence of steps or operations
describing how to carry out an activity and usually
involves a group. It is more specific than a policy and
establishes a customary way of handling a recurring
activity. Thus, less discretion on the part of the
supervisor is permissible in its application. An example
of a procedure is the sequence of steps in routing of
parts. A method sets up the manner and sequence of
accomplishing a recurring, individual task. Almost no
discretion is allowed. An example of a method is the steps in cashing a check.
A rule is an established guide for conduct. Rules include definite things to do
and not to do. There are no exceptions to the rules. An example of a rule is "No
Smoking."

Plan Monitoring. A systematic method of monitoring the environment must

be adopted to continuously improve the strategic planning process. To
develop an environmental monitoring procedure, short-term standards for key
variables that will tend to validate the long-range estimates must be
established. Although favorable long-range values have been estimated,
short-term guidelines are needed to indicate if the plan is unfolding as hoped.
Next, criteria must be set up to decide when the strategy must be changed.
Feedback is encouraged and incorporated to determine if goals and
objectives are feasible. This review is used for the next planning cycle and
review.

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