Arguments For and Against Strategic Planning

2945 words (12 pages) Essay

8th Feb 2020 Business Strategy Reference this

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Introduction

 

Strategic planning is an organization process of understanding their strategy and making decisions on where to allocate the companies resources in order to peruse the strategy. Using strategic planning can help organizations with many things like, improving organizational performance, build teamwork, expertise and foresee future problems and opportunities. If strategic planning where to be used successfully it could benefit public agencies, departments and major organizational divisions. The strategy is used to carry out the organizations comprehensive goals. – (www.semanticscholar.org 10th October 2018)

Nature of strategic planning approach

The nature of strategic planning is to understand how a company will work over a period of years in order to work from where it is to where it wants to be by deciding the companies’ institutional directions, intended results, how the results will be carried out to be accomplished and how success can be measured and evaluated, having a strategic plan means the company will be able to develop an understanding and explain the company to outsiders by defining the goals and objectives carried out by the organization. The strategic plan will contain the company, what the vision, mission and objectives are, the strategies, and how the effectiveness of the company will be assessed. – (www.slideplayer.com 2015) Arguments for having a strategic planning approach are that by using a strategy it can provide clarity on what direction the company is heading because the primary purpose of having strategic planning is so that the company can understand what the purpose of the organization which is also the companies mission statement, what the company wants to achieve, what the vision is and how the organization plans on getting there. Using a strategic plan will allow an organization will create a ‘roadmap’ to success as it minimizes confusion because it is all written down to avoid any risks because it will give clear deadlines and assignments so that employees know when to hand in particular work especially if an organization is planning a strategic plan in highly uncertain environments by defining challenges because it will allow a wide range of opinions and it can allow the company to dig more deeply into the issue because aligning the right issue means a team of employees can focus on answering the right questions that work towards the goal and avoids unwanted discussions. Another argument for strategic planning is that by creating a strategic plan in uncertain times it helps with organizational alignment, the process can allow the exchange of creative new ideas which also can include resolving any company disagreement’s by working out a solution. Allowing the employees to be involved in the strategic planning process ensures that everyone is on the same page which benefits the company because it shows that the organization values the employee’s opinion which will ensure that the employees make better decisions and also have the companies’ best interests when doing the plan and plan goals. However, for an organization to be successful in planning it has to make sure they have clear options because the jump from the present state to the chosen future platform will not happen overnight the goal has to be clear and be spaced out for any unforeseen bad decisions so that they can be corrected before it’s too late. – (www.achieveit.com 12th October 2018) (www.hubspot.net 12th October 2018)  However, there are arguments against strategic planning in uncertain environments especially trying to carry a plan out during turbulent economic conditions just because it’s common for every good company to have one, by following what every other organization is doing can lead to problems as if the company doesn’t take the time do it right then it can lead to confusion or if the organization where to write a plan and then forget about it, strategic planning can only work if it’s used as an effective management tool because if the plan is rushed it can cause hazards as  businesses in turbulent circumstances believe that they can only have one day per strategic issue, however big decisions have to be framed and then thought over for days until there is an agreement meeting because not taking notes and not thinking about all possible risks can cause challenges. – (www.forbes.com 30TH November 2011) Another argument against strategic planning in uncertain and turbulent environments is unrealistic goals, objectives or lack of focus, strategic plans must be organized clearly enough for employees to understand what they are doing and if the plan isn’t effective enough then the work won’t be carried out effectively because the employees aren’t focused on the goal of the company. If there isn’t a clear link to the vision of the organization then it could lead to the strategic plan being useless because the company cannot move forward in their planning approach, the plans cannot overly complex either because if they are not being effectively communicated due to their complexity the employees will struggle to carry them out. The objective has to be clear as the strategic plan will show and informative direction and if the decision is not clear then it can cause many critical issues.

( www.executestrategy.net April 25th 2015)

Benefits associated with formalized strategic decision making

One benefit that can be associated with strategic decision making in uncertain and turbulent environments is that it allows organizations to be proactive a strategic plan can ensure that a company can foresee the future and what direction they want to take especially if the organization is in an uncertain environment, using a strategic plan can help stop negative situations before they happen and can take precautions to avoid them. Using a strong strategic plan can help organizations be proactive as it is allowing the company to keep up with the no stop changing trends in the market and can keep ahead of the competition. Another benefit is that it helps to increase market share and profitability using a strategic plan it allows organizations to get valuable knowledge on market trends, consumerism and product and services which can help benefit their success. If this is adapted well it can turn all sales and marketing efforts into more forward-thinking outcomes which will help increase the company’s profitability and market share. The organization being proactive in a turbulent environment can allow them to be open to new ideas like perhaps partnering up with other companies or creating new business models because it’s important to avoid uncertainty. – (www.envisio.com) Another benefit is that by using the strategic approach in an uncertain environment can help give direction to meetings, because creating a strategic plan involves a lot of time and effort the employees of the company need to feel that all of the hard work they have produced will come towards one finial result. Planning can help stop free flowing discussions because some employees might feel as if they aren’t being heard and less valued or it can seem repetitive if it’s going around in circles. By using a plan, it can make sure that all meetings are professional and always have a topic related to the organization’s objectives and goals. For the organization benefit from strategic planning during a uncertain and turbulent environment is to start scenario planning as it helps to see all of the alternative routes to the major goal in the future and patterns of the key environmental variables as scenario planning also helps start the process of strategic thinking. – (www.simply-strategic-planning.com)  (www.semanticscholar.org)

Problems associated with formalized strategic decision making

One problem that can be associated with strategic decision making in uncertain and turbulent environments can be there is no plan behind the idea, when creating a strategic plan the organization has to reflect all of their futures goals and how to get there. If an organization has no scenario then the company has no ambition on their organization succeeding, if the company has no scenarios then it is hazardous because if the scenario isn’t clearly mapped out they can ignore unexpected issues and will struggle to get over the complication because they are unsure of the direction they are heading in.  Another problem could be that there are too many people involved in the strategic plan because the plan is vital and having a wide range of stakeholders in the decisions can cause complications because during turbulent times this can be difficult to start a process with too many opinions because there will be choices that require a lot of attention and if there are too many stakeholders it could be a longer decision-making process which delays the rest of the plan. It would be a messy unorganized approach that wouldn’t have the organization’s best interests during times of an uncertainty it would be easier if the meets were kept small because it would prolong the companies journey. Another problem could be old objectives, an organization when writing a strategic plan has to take into consideration that the plan will include everything and if the goals and objectives are outdated and unrealistic the company will not be able to move forward in its decision making because the strategic plans always function best the ideas are new and fresh, because it allows them to start again and focus their attention on completing the objective because it can work towards making the company successful in a turbulent and uncertain environment.- ( www.hubspot.net)

The role of uncertain and dynamic environments

The role of an uncertain and dynamic environment is a marketing campaign that can increase a company’s profits for the long run and can help towards the strategic goals they may have. Due to the challenge of the business market and environment constantly changing it is difficult to keep but with the consumer preferences because they keep evolving and it means that the business has to quickly adapt to the new trend quickly. Organizations must be able to monitor the changes that are happening around the world because to be a success in an uncertain and dynamic environment must be able to adapt quickly, because it is expensive and difficult to calculate the costs of the decisions the company will need to make to increase the chance of success. The organization has to be able to monitor and respond to important events that may surround their goals and carry out the plans while being respectful to the changes in the world, as if any changes happened the business should be aware and quick enough to adapt their plans while still continuing objectives that have been unaffected by the change in events. ( www.CiteSeer.com) There is challenges when using a marketing campaign like involving different target markets with cultural relevant proposals, organizations should use a PEST analysis to scan the political, economic, social, and technological macro environments to tests the elements that can affect the business. Using PEST analysis can help with the changes that evolve all over the world because of social and cultural changes and the growing and aging population, means there will be increasing expansions in health care. Technological change will offer both opportunity and threat because technology is global market, Economic and political challenges companies can be affected from countries abroad with different laws and legislation can affect the businesses outlook. (www.slideshare.com) Due to these difficulties it can create uncertainty in an organizations internal and external environment, because of how the company operates in the market. However, the business can try and fix the uncertainty by managing their growth so they can control their costs but this may not be a method that always works. (www.enotes.com)

Conclusion

In conclusion, this essay has discussed the for and against argument of strategic planning and whether is it is a useful method when in an uncertain and turbulent environment. In my opinion, I think that the method is useful because it always gives the organization a plan on what to do if they are at risk or lost sight of what they are working towards. I think that strategic planning helps as there are many ways to avoid being a hazard in the business world. However, I believe that business should only use the method If they are going to use it properly because during turbulent and uncertain times the organization cannot afford to be lost or heading in the wrong direction as it will fail, using the approach properly will constantly be a reminder of what the goal is for the future and help guide the company into a success.

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