Strategic Planning

Strategic Planning is a comprehensive process for determining what a business should become and how it can best achieve that goal. It appraises the full potential of a business and explicitly links the business's objectives to the actions and resources required to achieve them. Strategic Planning offers a systematic process to ask and answer the most critical questions confronting a management team—especially large, irrevocable resource commitment decisions.

Usage and effectiveness among survey respondents

How Strategic Planning works:

A successful Strategic Planning process should:

• Describe the organization's mission, vision and fundamental values
• Target potential business arenas and explore each market for emerging threats and opportunities
• Understand the current and future priorities of targeted customer segments
• Analyze the company's strengths and weaknesses relative to competitors and determine which elements of the value chain the company should make versus buy
• Identify and evaluate alternative strategies
• Develop an advantageous business model that will profitably differentiate the company from its competitors
• Define stakeholder expectations and establish clear and compelling objectives for the business
• Prepare programs, policies, and plans to implement the strategy
• Establish supportive organizational structures, decision processes, information and control systems, and hiring and training systems
• Allocate resources to develop critical capabilities
• Plan for and respond to contingencies or environmental changes
• Monitor performance

Related topics	Bain capabilities
Core Competencies Mission and Vision Statements Scenario and Contingency Planning	Change Management Corporate Strategy

Companies use Strategic Planning:

• Change the direction and performance of a business
• Encourage fact-based discussions of politically sensitive issues
• Create a common framework for decision making in the organization
• Set a proper context for budget decisions and performance evaluations
• Train managers to develop better information to make better decisions
• Increase confidence in the business's direction

SOURCE: bain.com