Strategic planning and strategic management may sound like they’re interchangeable, but they are two different parts of a very important process: achieving a business’s long-term goals. Strategic planning is the approach used in forming an organization’s direction (e.g., its vision, mission and priorities).
On the other hand, strategic management is the overall process of achieving that direction, from planning to executing. Managing the action plans, projects and lifecycle of the strategic plan is crucial to accomplishing your business’s long-term priorities.
Sometimes businesses will be better at looking forward and figuring out their opportunities than they are at executing their plans, or vice versa, so it’s important to break down what strategic management involves. The Association for Strategic Planning divides strategic management into three phases: think, plan and act. [1]
1. Think
Thinking comprises both an external assessment and an internal assessment. You want to consider external forces, such as emerging opportunities for your business to leverage in the future and threats you can minimize or work around. Technology can pose both an opportunity and a threat; your business must decide what your vision is and how developing technology fits into that vision.
Your internal assessment should evaluate your capabilities, processes, culture and change readiness. It’s incredibly important to understand how flexible and ready for change your organization is. Developing a good strategy doesn’t automatically equal buy-in from your employees. Culture and change readiness can blindside you when you’re trying to implement your strategy if you don’t take them into account beforehand and effectively manage change.
You should also take your customers into consideration. What feedback are you getting from them? Do they seem interested in a product or service you traditionally haven’t provided? Is a competitor disrupting your industry or gaining some sort of advantage over your business? Don’t leave out your customers when evaluating your organization’s SWOT (strengths, weaknesses, opportunities and threats).
2. Plan
This is where strategic planning comes into play. We previously discussed the seven essential parts of the strategic planning process, but essentially the process involves using your SWOT analysis to form your long-term vision and drill down from there into your strategic priorities, goals and action plans.
A key aspect of strategic planning is to include organizational drivers of success. Make sure to ask what “success” and “done” looks like. You should be able to measure your progress to see if you’ve met your goals. Determine those measurements during the planning process, not after.
3. Act
Executing your strategic plan involves a few vital steps. First is creating a performance culture to give your employees visibility into what your goals are, how they’re being met and when you successfully complete a goal. Since every employee plays some sort of role in the strategic plan’s execution, visibility and communication must start at the top. Otherwise those employees are less invested in the plan, and you run into change management problems.
To overcome those problems, you must also build accountability. Developing a culture of ownership allows every employee to feel like they own the results and successes of your plan.
Not every plan will go smoothly without any readjustments. Be sure to act on the measurements you set in the planning phase. Are you seeing the results you expected? Is there something new you can leverage? Reviewing and evaluating your strategy execution to adjust course is one of the most important strategic management actions you can take.
Every Employee Plays a Role in Strategic Management
While communication and metrics are two big parts of strategic management, don’t discount prioritization. You can’t ask your employees to do two full-time jobs, so you need to balance strategy with everyday work so production doesn’t grind to a halt and make your strategy a moot point. Prioritize goals and actions plans and build out a timeline that takes into account the everyday work.
Also make sure you keep an eye on how people’s roles change because of the strategy. Updating job descriptions and titles helps ensure employees feel aligned behind a shared vision and are committed to the strategy. Clearly communicate performance measurements at all levels and find a way for employees to provide feedback in return.
And in the end, remember that strategic management is an iterative, ongoing process, not a single event. When you have the plan, the buy-in and the measurements, you’ll still need to review and readjust to help your organization stay on the path to achieving its long-term vision and goals.
If you’d like to learn more about strategic management and how it can help your business grow and reach its goals, contact Wipfli.
[1] “Who We Are,” The Association for Strategic Planning, https://www.strategyassociation.org/page/aboutus_overview, accessed May 22, 2018
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