Strategic Planning Techniques

Strategic Planning Techniques

Strategic Planning Techniques Jonathan Poland

Strategic planning is the process of defining an organization’s direction and making decisions on allocating its resources to pursue this direction. It involves setting goals, analyzing the competitive environment, and identifying external and internal factors that are favorable or unfavorable to achieving the goals. Effective strategic planning requires strong leadership, clear communication, and a commitment to continuous improvement. It helps organizations align their resources and efforts towards a common vision, and can lead to increased efficiency, competitiveness, and success. The following are techniques that are commonly used to plan a strategy.

Benchmarking
Benchmarking is the comparison of your metrics with a competitor or industry average. For example, a firm may consider how much its spending on innovation or technology relative to its industry.

Budget Planning
In many cases, strategy formation is closely tied to an annual or quarterly budget planning process.

Business Analysis
Validating the assumptions that underlie your strategy with business analysis techniques such as voice of the customer or statistical analysis.

Business Cases
A business case is a formal proposal for a strategy that includes analysis of benefits, costs and risks.

Business Models
A business model is the framework that an organization uses to capture value. In most cases, a strategy adds products, services and capabilities to an existing business model. Occasionally a strategy may also seek to transform a business model or enter new industries.

Business Plans
A business plan is a proposal for a major new initiative such as entering a new market or transforming a technology platform. Business plans are most typically targeted at investors in new businesses but can be developed internally where due diligence is required.

Capability Analysis
Describing your organization as a set of capabilities and identifying gaps that represent a competitive weakness or new capabilities that represent a potential advantage.

Competitive Intelligence
The practice of gathering information about competitors, markets, products, industry trends and customers. Competitive intelligence is a fundamental input for strategy planning.

Estimates
Developing preliminary estimates for strategic plans using a high level estimation methodology such as reference class forecasting.

Financial Analysis
Analysis of financial metrics such as return on investment and payback period.

Forecasting
Strategy planning often requires forecasts such as predictions of market demand.

Goal Planning
A goal is a desired outcome. Strategy is primarily driven by goals in the context of the opportunities and threats that exist in the market. It is common to define goals as a starting point of strategy planning.

Goal Setting
Goal setting is a means of strategy implementation that sets goals for your organization, departments, teams and individual contributors.

Management Accounting
A collection of accounting techniques that support management decision making and optimization.

Market Analysis
An analysis of market conditions such as size, growth rates, demographics, influencers and trends. Important to industries such as technology and fashion that experience a high rate of market driven change.

Mission and Vision
Mission and vision are fundamental statements of why you exist and where you are going. Organizations with a strong sense of identity and purpose tend to develop more effective strategies.

Prioritization
In most cases, an organization develops far more strategies than it’s possible to execute due to constraints such as budget and time. As such, prioritization is a critical strategy planning step that decides what gets done. A strict ranking of priorities typically achieves more than a rating system.

Risk Identification
It is common for strategy planning to involve early phases of risk management such as risk identification with estimates of impact and probability.

Scenario Planning
Scenario planning is the practice of planning tactics in advance.

Strategic Drivers
Strategic drivers is a broad term for everything that influences a strategy including mission, vision, goals, values, principles, competition, regulations and markets. Listing out strategic drivers is a basic step in strategy formation.

Structured Decision Making
The use of a process for strategic decision making such as steps that allow your entire organization to provide strategy proposals with a system of prioritization and approvals.

Structured Planning
The use of a process for strategic planning that might include information gathering, strategy formation, estimation, business cases, reviews, decision making points, budget approvals and goal setting.

Swot Analysis
An evaluation of current strengths, weaknesses, threats and opportunities.

Target Operating Model
A vision for the future capabilities of your organization.

Learn More
Situational Awareness Jonathan Poland

Situational Awareness

Situational awareness (SA) is the ability to understand and effectively respond to a situation by being aware of what is…

Customer Preferences Jonathan Poland

Customer Preferences

Customer preferences are the specific desires, likes, dislikes, and motivations that influence a customer’s purchasing decisions. These preferences complement customer…

Innovation Metrics Jonathan Poland

Innovation Metrics

Innovation metrics are tools used to assess the innovation efforts of a company. It can be challenging to accurately measure…

Maintainability Jonathan Poland

Maintainability

Maintainability refers to the relative ease and cost of maintaining an entity over its lifetime, including fixing, updating, extending, operating,…

Customary Pricing Jonathan Poland

Customary Pricing

Customary pricing refers to the pricing practices that are considered typical or normal in a particular industry or market. This…

Fixed Costs Jonathan Poland

Fixed Costs

Fixed costs are expenses that remain constant regardless of changes in a company’s level of production or sales. These costs…

Process Capital Jonathan Poland

Process Capital

Process Capital is a term that refers to the financial resources that a company uses to fund its operations and…

Operations 101 Jonathan Poland

Operations 101

Business operations refer to the processes and activities that are involved in the production of goods and services in an…

Customer Satisfaction Jonathan Poland

Customer Satisfaction

Customer satisfaction is the practice of measuring how happy customers are with a brand’s products and services. This is typically…

Content Database

Search over 1,000 posts on topics across
business, finance, and capital markets.

Inventory 150 150 Jonathan Poland

Inventory

Understanding inventory is crucial for the successful operation of many businesses. Inventory is a broad area with many facets, and…

The Fundamentals of Business Mastery Jonathan Poland

The Fundamentals of Business Mastery

Overview Business comes down to just two areas: investments and deliverables. Leaders make investments in people, products that are delivered…

Data Security Jonathan Poland

Data Security

Data security is the practice of protecting data from unauthorized access, use, modification, destruction, or deletion. It is a key…

Product Identity Jonathan Poland

Product Identity

Product identity refers to the overall personality or character of a product. This can include the product’s features, benefits, and…

Ease of Use Jonathan Poland

Ease of Use

Ease of use refers to the usability of a product, service, tool, process, or environment, and is an important factor…

Ingredient Branding Jonathan Poland

Ingredient Branding

Ingredient branding, also known as component branding or parts branding, is a marketing strategy that focuses on promoting the individual…

Brand Equity Jonathan Poland

Brand Equity

Brand equity refers to the value that a brand adds to a product or service. It is the positive perception…

Yield Management Jonathan Poland

Yield Management

Yield management is a pricing strategy used by businesses that offer access to fixed-capacity assets, such as airline seats and…

Government Contract Timeline 150 150 Jonathan Poland

Government Contract Timeline

A government contract award timeline can vary depending on the specific country, agency, and procurement process in question. In general,…