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Twenty One Aspects Of Strategic Planning

3463 words - 14 pages

INTRODUCTIONThis is a review of the 21 aspects presented by Brian Tracy as relevant for strategic planning. This review is based on what was presented by Tracy in the video, references on the different aspects and the writer reflections.1. REASONS FOR STRATEGY1.1 ROEReturn on equity refers to the profits earned per rupee invested by shareholders or owners of a business (explained in more detail in a later section). This is the primary reason for the existence of a business. In order to increase ROE in a competitive environment, strategy is required. Peter and Certo, 1991, state that organisations with good strategic management tend to increase their levels of profit and profitability.1.2 RepositioningBusinesses operate in a dynamic world. The markets, competition and other environments such as the political, economic, social and technological environments that affect business are all changing constantly. Thus, in order to succeed, businesses also need to change (or to reposition) in response. Strategic planning is essentially an activity lf aligning the organization with the environment. Thus it enables effective repositioning when required.1.3 Maximize Strengths and OpportunitiesIn the previous section it was noted that strategic planning is an alignment exercise. In this exercise, a SWOT analysis is carried out. The courses of action that are selected subsequently (the strategies) are the ones that can (ideally) best exploit the opportunities in the environment utilizing the organizational strengths while minimizing treats and weaknesses.1.4 Action : NowIn the absence of strategic planning and strategies, organizations stagnate. They habitually perform routine activities without clear purpose or rigour. Strategies compel organizations into action in order to achieve clearly defined, specific, time bound goals.2. STRATEGIC PLANNING SIMPLIFIEDThis section gives four steps to be followed in strategic planning.2.1 Where Are We Now?The first step in strategic planning is to identify the current position of the organization. It is difficult to plan your future courses of action without knowing one current position. This step involves a thorough investigation of the organization and its environment. This is also called a situational analysis.2.2 HistoryThis step is an analysis of what the organization had done in the past. It shows how the business came to its current position. This analysis reveals vital information about the success or failure of previous strategies. They formulate a good basis for developing future strategies. The historical analysis helps in part to identify what is known as the lanning gap?In identifying the lanning gap?the organisation needs to examine the strategies it has been using in the past up to the present. Then it needs to project where the organisation would go if the past and present strategies were continued into the future. Finally this destination is compared with the destination the company wishes to reach in...

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