Confusion about Strategic Planning
Clearing Up the Confusion about Strategic Planning. Many people are confused by the terms strategy, strategic plan, and strategic planning. Well, I am here to help you get a clear picture. For the moment, forget what you’ve heard about this subject. Strategic planning makes a huge difference to your organization both tangibly and intangibly, so keep reading!
What is strategy?
Strategy means consciously choosing to be clear about your company’s direction in relation to what’s happening in the dynamic environment. With this knowledge, you’re in a much better position to respond proactively to the changing environment.
The fine points of strategy are as follows:
- Establishes unique value proposition compared to your competitors
- Executed through operations that provide different and tailored value to customers
- Identifies clear trade offs and clarifies what not to do
- Focuses on activities that fit together and reinforce each other
- Drives continual improvement within the organization and moves it toward its vision
Surprising strategic-planning stats
95 percent of a typical workforce doesn’t understand its organization’s strategy.
90 percent of organizations fail to execute their strategies successfully.
86 percent of executive teams spend less than one hour per month discussing strategy.
60 percent of organizations don’t link strategy to budgeting.
So what’s the upshot of these surprising revelations?
Strategic planning matters to the life of your business!
Knowing what strategy is can also be explained by looking at what strategy is not. Dr. Michael Porter, the leading strategy guru and professor at Harvard, had this to say at the 2006 World Business Forum in Chicago.
Strategy is not:
-
Best practice improvement
Execution
Aspirations
A vision
Learning
Agility
Flexibility
Innovation
The Internet (or any technology)
Downsizing
Restructuring
Mergers/Consolidation
Alliances/Partnering
Outsourcing
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