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STRATEGIC PLANNING FOR TECHNOPRENEURS
What is Strategic Planning?
We know how important planning and strategizing are in our everyday lives. The mere budgeting of our
daily finances can be considered as strategizing. Wars and sports games are won using sound strategies.
Businesses flourish with good strategy.
Strategic Planning vs. Strategic Management
Strategic planning is developing detailed business strategies, putting them into practice, and analyzing
the outcomes of a company’s long-term goals. It is a theory that emphasizes combining a business’s
marketing, financial, and human resources departments to meet its strategic goals.
The goal of strategic management is to maintain a competitive advantage over rivals and take control of
the market as a whole. Further, it evaluates, guides, and changes the strategy per the business climate
progressions. Strategic management assists in creating a strategic vision, establishing goals, establishing
direction, and creating and implementing strategies that align with the organization’s goals to evaluate
the organization’s internal and external business environment.
Figure 1. Key Differences between Strategic Planning vs. Strategic Management
Source: https://keydifferences.com/difference-between-strategic-planning-and-strategic-management.html
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Strategic Planning Process
Strategic
Planning
Strategy
Formulation
Strategy
Implementation
Strategy
Evaluation
Figure 2. The steps in strategic planning
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Strategic planning calls for in-depth planning and foresight on an organization’s upper-level
management. Before choosing a course of action and planning how to carry it out, executives may
consider several alternatives. In the end, a company’s management will hopefully settle on a strategy
that can be implemented cost-effectively with a high possibility of success and avoid undue financial
risk. Positive outcomes are often thought of as improving the business’s bottom line.
Generally speaking, strategic planning is regarded to be established and carried out in three (3)
important steps:
1. Strategy Formulation (Determination of strategic objectives) - Key objectives can be extracted
from the mission and vision statements of the enterprise. From here, strategic objectives can be
made.
Strategic objectives refer to the specific performance targets the business wants to accomplish.
These objectives define how the enterprise’s mission will be met. For example:
a. Expand delivery services by 25% within a year.
b. Increase production by 50% by the end of this year.
c. Increase the number of branches in one (1) year.
The company must conduct an internal and external audit to evaluate its current situation
before developing a strategy. This is done to determine the opportunities and threats and the
organization’s strengths and weaknesses (SWOT Analysis). Managers use the analysis to decide
which plans or markets to focus on or ignore, how to allocate the company’s resources
optimally, and whether to expand operations through a merger or joint venture.
2. Strategy Implementation (Adoption or use of strategic course of action) - Following the
formulation of a strategy, the business must allocate resources for its implementation and
establish specific targets or goals related to its implementation. How well upper management
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communicates the chosen strategy throughout the company and gets all employees to commit
the desire to put the strategy into action determines the success of the implementation stage.
The construction of a solid structure, or framework, to implement the strategy, optimize
appropriate resource usage, and reorient marketing activities following the strategy’s aims and
objectives are all critical components of successful strategy implementation.
3. Resources come in different forms. Money and even labor are precious resources that can be
used. However, without a sound strategy, these can go to waste, so it is imperative to the
enterprise how and how much they should allocate resources based on the various activities
required to achieve the objectives.
4. Strategy Evaluation (Evaluation of the performance of the chosen strategy) - Any experienced
entrepreneur is aware that success today does not guarantee success in the future. As a result,
managers must evaluate a strategy’s performance following its implementation phase.
Three (3) essential steps are involved in strategy evaluation:
• Evaluating performance.
• Evaluating the internal and external factors that influence the strategy’s
implementation.
• Adjusting the strategy’s effectiveness.
For instance, a company might discover that to achieve the desired improvements in customer
relations. It needs to adopt a brand-new Customer Relationship Management (CRM) software
program after implementing a strategy to enhance customer service.
Each of the three (3) important steps is placed inside three (3) progressive levels: operational, middle
management, and senior management levels. Therefore, to assist the business in functioning as a more
efficient and effective team, it is vital to encourage communication and interaction between managers
and employees at all levels.
Strategic Planning Models
As discussed, strategic planning is crucial to the enterprise’s long-term success. It gives a sense of
direction to the business and is essential in making decisions. Many established entrepreneurs and
technopreneurs treat strategic planning like a blueprint of an architectural building. There is no best or
great model, and the usage of such plans depends on how an enterprise will achieve its goal. Below are
the basic strategic planning models being used by enterprises (Business Benefits Group, n.d.).
1. Basic Strategic Planning Model – usually consists of creating a mission statement detailing the
enterprise’s existence. The business then will figure out its intermediate goals, referring to what
needs to be done to accomplish its mission.
Best for:
• Small businesses or organizations
• Companies with little to no strategic planning experience
• Organizations with few resources
2. Goal-based Strategic Planning Model – is designed for more established businesses and
enterprises. Using this strategic planning model entails using a SWOT analysis. Right after, the
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enterprise identifies goals and issues it can take advantage of to prioritize its objectives better.
The next step is formulating a mission statement and action plans, creating a strategic plan,
developing an operational plan, and formalizing the budget for the enterprise’s first year.
Best for:
• Organizations with basic strategic planning experience
• Businesses that are looking for a more comprehensive plan
3. Scenario Strategic Planning Model - This makes use of a PESTEL analysis. This model can be
used by an enterprise that wants to beef up and prepare for different scenarios, such as changes
in the economy, trends in society, new laws, and other external forces that can alter how it does
business. The enterprise can list the most common problems that could affect their business
over the next three (3) to five (5) years and create responses on how to resolve them.
Best for:
• Organizations trying to identify strategic issues and goals caused by external factors
4. Alignment Strategic Planning Model - This model creates alignment between a business’s
resources and mission. It helps fine-tune the enterprise’s objectives or learn why its goals are
not being achieved as planned. This model starts by determining the business’ resources,
mission, programs, and required support. After this, it is important to know what areas in the
business are working well and which ones need further adjustment to reach the desired effect.
Lastly, the business needs to include adjustments as strategies in the plan.
Best for:
• Organizations that need to fine-tune their strategies
• Businesses that want to uncover issues that prevent them from aligning with their
mission
• Companies that wish to reassess objectives or correct problem areas that prevent them
from growing
5. Organic Strategic Planning Model - This model requires continual reference to common values
and shared reflection around current processes. Organic planning often uses a technique known
as storyboarding to let participants create their ideas before sharing them with a larger group. In
this type of planning, brainstorming is imperative to pinpoint the needs of the enterprise and
target the issues that need addressing.
Best for:
• Large organizations that can afford to take their time
• Businesses that prefer a more naturalistic, organic planning approach that revolves
around common values, communication, and shared reflection
• Companies that have a clear understanding of their vision
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6. Real-time Strategic Planning Model - The real-time strategy planning approach is even more
adaptable than the organic model. It aids in presenting an organization’s vision, values, and
mission. Lists are frequently presented to board members or management for further discussion
during real-time strategic planning.
Best for:
• Companies that need to react quickly to changing environments
• Businesses that are seeking new tools to help them align with their organizational
strategy
7. Inspirational Strategic Planning Model - This quick strategy starts with creating a very inspiring
vision for the organization and the goals that go along with it. This model is better for more
established businesses than the basic model.
Best for:
• Businesses with a dynamic and inspired start-up culture
• Organizations looking for inspiration to reinvigorate the creative process
• Companies looking for quick solutions and strategy shifts
Strategic Decision-Making
According to Henry Mintzberg, the following are the most typical approaches or modes of strategic
decision-making:
• Entrepreneurial mode. It states that one powerful individual makes strategy. This mode focuses
on opportunities and growth, not business problems. Strategy is guided by the founder’s vision
of direction and is exemplified by significant, bold decisions. The dominant goal of this mode is
the growth of a corporation.
Example:
Amazon.com, founded by Jeff Bezos, reflects Bezos’ vision of using the Internet for marketing
everything that can be bought.
• Adaptive mode. It is characterized by reactive solutions to existing problems rather than a
proactive search for new opportunities. Strategy is fragmented and is developed to move a
corporation forward incrementally. This mode lacks clarity and consensus on strategic goals and
is only appropriate for dealing with complex and changing environments.
Example:
Due to the Covid-19 pandemic lockdown, movie theaters worldwide were temporarily shut
down. Walt Disney, a multinational mass media and entertainment company, decided to launch
Disney+, a home entertainment subscription streaming service with access to all the Disney
brand’s classic, present, and upcoming movies.
• Planning mode. It systematically gathers appropriate information for situation analysis,
generates feasible alternative strategies, and rationally selects the most appropriate strategy. It
includes the proactive search for new opportunities and the reactive solution to existing
problems.
Example:
After carefully studying trends in the mobile and communication industries, Samsung noted that
the company needed to rebrand itself from being an appliance manufacturer to a customer-
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focused and highly reliable information technology infrastructure and electronic commerce
service. By late 2000, the company had launched several phones, leading to global success.
• Logical Incrementalism. In this mode, top management first develops a reasonably clear idea of
the corporation’s mission and objectives. It is a fusion of strategy formulation and
implementation. This approach appears useful when the environment is changing rapidly, when
it is building consensus, and when resources must be developed before committing the entire
organization to a specific strategy.
Example:
In the petroleum industry, corporate headquarters established the mission and objectives but
allowed the business units to propose strategies to achieve them.
Strategic Decision-Making Process
Managers of successful organizations do more than find a way to make money and sell products or
services. They also think of the big picture and make decisions to get the company where it wants to go.
This type of decision-making guides the choices created and aligns them with the company objective.
The steps in the strategic decision-making process are as follows:
1. Evaluate current performance results.
The organizational performance must be assessed based on return on investment, profitability,
current mission, objectives, strategies, and policies.
2. Review corporate governance.
The organization must evaluate the performance of its board of directors and top management.
3. Scan and assess the external environment.
The organization must determine the strategic factors that pose opportunities and threats.
4. Scan and assess the internal corporate environment.
The organization must determine its strengths or core competencies and weaknesses.
5. Analyze strategic factors.
The organization must pinpoint its problem areas and revise its corporate mission and
objectives.
6. Generate, evaluate, and select the best alternative strategies.
The organization must identify the best course of action to solve an identified problem and
achieve a set of objectives.
7. Implement selected strategies.
The organization must implement strategies through company programs, budgets, and
procedures.
8. Evaluate implemented strategies.
The organization must monitor the implemented strategies through feedback systems and
control of activities that ensure minimum deviation from original plans.
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References
Bamford, C., Hoffman, A., Hunger, D., &Wheelen, T. (2018). Strategic management and business policy: Globalization,
innovation and sustainability (15th ed.). United Kingdom: Pearson Education Limited.
Business Benefits Group. (n.d.). The 5 strategic planning models that all executives should know.
https://www.bbgbroker.com/strategic-planning-models
CFI Team (2022) Strategic Planning. https://corporatefinanceinstitute.com/resources/management/strategic-planning/
Hannan, M. T. (2015, November 19). Organizational analysis. https://www.britannica.com/science/organizational-analysis
Morgan, J. (n.d.). The 5 types of organizational structures. http://www.forbes.com/sites/jacobmorgan/the-5-types-of-
organizational-structures-part-5-holacratic-organizations
Sridharan, M., Gadjji, M., Agrawal, S. (2022) Minszberg’s 5PS – How to define strategy? https://thinkinsights.net/strategy/
mintzbergs-5ps/
Team Asana (2022.) 7 strategic planning models, plus 8 frameworks to help you get started.
https://asana.com/resources/strategic-planning-models
Weller, J. (2021) How to Use Strategic Planning Frameworks and Models. https://www.smartsheet.com/strategic-planning-
models
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