5 Valuable Elements of Successful Strategic Planning
Successful strategic plans are not known for being easy to create or execute. However, successful strategic planning is well worth the effort and time that businesses invest. Unfortunately, business professionals too often fail in their strategic planning process due to a lack of knowledge. Considering the extensive resources utilized during the strategic planning process understanding key elements should be deemed essential.
There are various key elements of strategic planning that necessitate consideration. Key elements range from the mission statement and vision statement to SWOT analysis execution. 5 valuable elements of a successful strategic planning process include-
A company's mission statement is a comprehensive formulation that explains why the business exists. A mission statement also declares what an organization hopes to become in the future. The mission statement includes long term goals with associated strategic plans to accomplish them. Alternatively, a vision statement is more concise and predicts long term future business status. For some companies, a vision statement will span five years into the future and for others two decades forward.
It is important that both short term and long term goals contained in these statements are SMART goals. SMART goals are any goals that are specific, measurable, achievable, realistic, and timely. Another helpful goal acronym is BHAG which stands for big, hairy, audacious goals. BHAG goals encourage effective strategic execution of short term decisions in order to accomplish long term objectives.
Core values are crafted after a mission statement and vision statement are formulated. Core values encompass a business's perception of right and wrong. As an extension, acceptable and unacceptable behaviors are often noted within core values. Both leaders and team members can reference core values for guidance for short term and long term decision making processes.
Core values are distributed to all employees on staff, regardless of their hierarchical standing. Stakeholders are often also interested in the core values of specific businesses. While some companies may assume core values need implementation, experts advise that the values may be preexisting. In order for strategic planning professionals to pinpoint core values a close analysis of company culture is recommended.
3. SWOT Analysis
The SWOT analysis is widely considered absolutely crucial for effective strategic planning. SWOT analysis evaluates the strengths, weaknesses, opportunities, and threats of a specific organization. A SWOT analysis allows organizations to more intimately understand themselves. Too often, a large corporation blinded by success can turn a blind eye to weaknesses. Alternatively, a small business could be so preoccupied with threats that as a result amazing opportunities are overlooked.
Effective strategic planning with SWOT analysis encourages businesses to evaluate both the short term and long term future more comprehensively. SWOT analysis results may prevent catastrophic issues from arising or lessen the extent of their damage. A SWOT analysis supplies valuable additional time for a business to prepare for potential threats and confront weaknesses. Likewise, preparation for opportunities and further enhancing strengths can position a business for extensive long term success.
Long term objectives are a significant focus of any effective strategic planning process. Long term goals define what a business needs to allocate resources towards. Long term objectives also supply a sense of direction and guidance to all staff members. Typically, long term objectives span several years into the future.
The formulation of a comprehensive strategy is necessary to most effectively achieve long term goals. An excellent strategy allows strategic planning professionals to better organize performance initiatives. As a result, more short term priorities are established and delegated.
The ability to measure the progress and success of a strategic plan is nonnegotiable. Without measurement capabilities, there is no way for businesses to know if a strategic plan is effective. Effective strategic planning is a long term process that necessitates consistent check ins and regulation.
As such, corporations need to track performance and output levels. Output and performance may be measured against consistently scheduled targets. An effective strategic plan will have built in timelines established already. Financial analysis is also important for organizations to stay fiscally aware of strategic planning process associated costs incurred. A comprehensive financial analysis is an invaluable tool for both budgeting and seeking out new potential investors.
Monitoring avoids short term issues developing into long term problems. Outstanding monitoring allows businesses to undertake corrective action whenever necessary. Strategic planning professionals should not be alarmed when adjusting plans. As an effective strategic plan is long term in nature adjustments are anticipated. Ultimately, an adjustment is much more preferable to the alternative course of action which is potential plan failure.
Remember, if not effective the entire strategic planning process will need to be repeated. Abandoning a strategic planning process can not only devastate a business's resources but also morale. As such, great care and consideration must be put into strategic planning processes every step of the way.
Key Takeaways for Elements of Strategic Planning
The 5 key elements of successful strategic planning are mission and vision statements, core values, SWOT analysis, long term objectives, and measurement.
Understanding the key elements of effective strategic planning significantly increases the likelihood of successful plan execution.