Strategic Management: Executing Strategic Planning
Strategic management
, at its most fundamental level, balances what an organization needs to do today to be successful and what it will need to do several years down the road to be successful. The strategic planning and strategic management processes are most successful when they precisely balance stasis and change.
Strategic Planning:
- Manages the intersection of the organization and the environment
- Relentlessly pursues opportunities and nourishes the innovation to meet them
- Pursues opportunities that have not fully materialized yet which requires risk taking
- Invents/creates an organization’s future opportunities
Planning is a continuous process as customers, competitors, stakeholders, technology, etc. never sit still. Consumer packaging that can change color or message—while it’s containing product—is a hair’s breadth away. How will that affect your business? And if the packaging can do that, why not the product?
Strategic direction is set at the highest levels of the organization. What follows is that each business unit or department must produce goals that align with the direction. At the business unit level, there are 5 key elements:
- Identify what is and is not within the charter of the business unit
- Set financial and non-financial targets that will guide the business unit’s strategy development and assess its progress
- Define the competitive advantage. Identify dimensions the customer perceives as better than your competitions
- Design partnerships to produce the greatest overall value
- Maintain the business unit’s internal value chain and integrate with the value chains of other business units and departments
Of course, a well-executed strategic plan hinges on managing the change processes throughout the organization. Every person in the organization must understand their contribution to the strategy and commit to making that contribution.
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