Part I: Strategic Planning

Question 1

What is strategic planning?

Answer 1

Strategic planning is an organization’s process of defining its strategy, or direction, and making decisions on allocation its resources to pursue this strategy. In order to determine the future direction of the organization, its necessary to understand its current position and the possible avenues through which it can pursue particular courses of action: what, for whom and how we do things.

“Hope for the best, plan for the worst”

Question 2

What are the key components in strategic planning?

Answer 2

The key components of “strategic planning” include an understanding of an entity’s:

• vision
• mission
• values
• strategies

Question 3

Key component: vision

Answer 3

Vision: outlines what the organization wants to be, or how it wants the world in which it operates to be.

• Idealized
• Long term view
• Emotive, source of inspiration

Question 4

Key component: mission

Answer 4

Mission: defines the fundamental purpose of an organization or an enterprise. Succinctly describe why it exists and what it does to achieve its vision.

Question 5

Key component: values

Answer 5

Values: beliefs that are shared among the stakeholders of an organization. Values drive an organization’s culture and priorities and provide a framework in which decisions are made.

Question 6

Key component: strategy

Answer 6

Combination of the ends (goals) for which the firm is striving and the means (policies) by which it is seeking to get there.

Ensure company goes in the right direction -> towards the end vision.

Question 7

What is the difference between vision statement and the mission statement?

Answer 7

Vision is a descriptive picture of desired future state; and the mission being a statement of a rationale, applicable now as well in the future. The mission is therefore the means of successfully achieving the vision. This may be in the business world or the military.

Question 8

Examples of strategic planning process

Answer 8

Situation-Target-Proposal:

• Situation: evaluate the current situation and how it came about.
• Target: define goals and/or objectives (sometimes called ideal state)
• Path/Proposal: map a possible route to the goals/objectives.

Draw-See-Think-Plan:

• Draw: what is the ideal image or the desired end state?
• See: what is today’s situation? What is the gap from ideal and why?
• Think: what specific actions must be taken to close the gap between today’s situation and the ideal state?
• Plan: what resources and steps are required to execute the “plan”?

Question 9

What is SWOT? What is its main objective?

Answer 9

SWOT is the most widely used tool for strategic planning. It means: strengths, weaknesses, opportunities, and threats.

The main objective of this tool it to analyze internal strategic factors, strengths and weaknesses attributed to the organization, and external factors beyond control of the organization such as opportunities and threats.

Question 10

When we are analyzing the organization current situation, which external factors are important to consider?

Answer 10

• Markets (customers)
• Competition
• Technology
• Supplier markets
• Labor markets
• The economy
• The regulatory environment

It is rare to find all seven of these factors having critical importance.

Markets and competition are almost always of critical importance.

Question 11

What is one of the core goals of a strategic plan and how is may fail to achieve it?

Answer 11

One of the core goals of a strategic plan is to develop it in a way that is easily translatable into action plans.

Most strategic plans address high level initiatives and overarching goals, but don’t get articulated (translated) into day-to-day projects tasks that will be required to achieve the plan.