Strategic planning is important to an organization to define values, create a cohesive visions, chart a direction and set goals for future growth. The process begins with statement of company vision and objectives and a SWOT analysis of the current company strengths, weaknesses, available opportunities and possible threats. From this basis, management develops, implements and monitors a strategy. Three common areas of focus in a strategic plan are vision planning, scenario planning and issues planning.
Strategic plans may look similar because they regularly start with development of a company vision or mission and stated objectives. The company vision and objectives describe what a company will strive to resemble and under what guiding principles it will operate. From these principles, a company analyzes what it does right and what internal challenges it faces in seeking growth. A SWOT analysis could uncover weakness in business policy or processes or the strength of the company marketing objectives. The opportunities and threats are the external factors Examples are a promising new product or negative forces such as foreign competitors that stand in the way of reaching for overseas markets. A company forges goals and a plan of action based on the initial mission statements and a recognition of internal and external factors.
Vision planning is the basic template for a strategic plan. A vision plan is more broad-based and can be implemented by companies new to the strategic planning process. Vision planning closely mirrors a standard business goal-setting process: A company creates a vision statement, sets overall objectives, performs a strategic assessments such as a SWOT analysis, lists stated goals, implements a plan to reach the goals and then regularly monitors the goals long the way. The vision planning process yields to a longer term focus, aligning goals and specific planning to time frames that are often years into the future.
Scenario planning relies heavily on a SWOT analysis to determine opportunities and threats and develops strategic plans based on the most probable occurrences. For example, if a company has a strategic vision to develop products to market internationally, a stated objective would be to develop plans for entering a specific overseas market. After a SWOT analysis, the company chooses a specific country but finds that several competitors with similar products have entered that market recently. The company then develops plans to challenge the competitors, researching aggressive marketing efforts in order to introduce a new product that could challenge competitors successfully. In scenario planning, the vision and objectives narrow in focus to address the most pressing threats or the most promising opportunities.
Issues planning focuses even more narrowly, addressing one specific challenge an organization faces. Issues planning still utilizes a strategic analysis, but the resulting plan often focuses on internal strengths and weaknesses as opposed to external opportunities or threats. An example would be a smaller organization that is facing the departure of a member of senior management. The organization needs to determine how this departure will affect future direction and develop a plan for either maintaining the current course or setting a new vision statement and objectives.