All you need to know about strategic planning for a business

  

Date Posted: 11/13/2012 1:00:40 AM

Posted By: fly1234  Membership Level: Bronze  Total Points: 15

---

Every organization needs a clear strategic planning method that would define their profitability in the near future. In other words, a step by step guide would help them achieve both short and long term goals. The process of strategic planning, however, needs a tactical approach as any mistake could lead to failure rather than success of the business in question. An organization therefore would start by projecting a clear vision of where they want to be in the next 5-6 years. It would require them to consider the condition of the business at the moment, their current organizational practices, financial resources and their competitors as well. After doing this, they can structure a plan that will give directions to the business.

Strategic planning tries to answer a number of questions. They involve:

1. What is the target of the organization in the future?

2. What is the capacity of the organization in terms of resources?

3. How is the organization using their present resources?

4. Who are the organization's competitors?

5. What is the nature of environment in relation to business that the company is operating in?

6. What are some of the vital strategies, objectives, goals and policies, the company can put in place to economize resources while maximizing profits?

Once the organization has put forward these questions, it can go ahead to engage it's think tanks to solve the problem. This would be a continuous process, giving directions to their plan.

The dynamics of a strategic plan
First, the strategic plan is unique to every company and is usually designed with short, medium and long term goals in mind. Every member of the management team will play his part by solving questions
relating to areas of their accountability. The members coordinate between teams and various divisions in the management to put together an effective plan.

The areas addressed

in particular include all the peripherals of a company's operation namely; Sales and marketing, technological development, staff and team management, financial and accounting, product development e.t.c. The actual purpose of a plan is to customize these areas to suite the environment of a particular business.

Importance of strategic planning

1. Is a structure that serves as a tool for approval and decision making.

2. It monitors performance and benchmarking.

3. Acts as a road map to achieving an organization's goals.

4. Provides room for employee motivation and also innovation of company's products/services.

5. Serves as blueprint for effective running of the business.

6. An instrument of articulating the organization's vision and value.
7. Helps a company to work on priorities.

As you can see, putting together an effective need time and effort. A company needs accurate and reliable data to work on when preparing a plan.

---

Next: Benefits of mobile banking in Kenya
Previous: Effective Examination Preparation Skills in Kenya