what is strategic business planning ?

Strategic planning is a systematic process for developing an organization’s direction. It also articulates the objectives and actions required to achieve that future vision, and outlines metrics for measuring success.

By helping you refocus on your foundational purpose, your goals, development and your opportunities, strategic planning reintroduces you to “the big picture.” It’s the basis for business owners to achieve their vision, which they communicate to stakeholders in a strategic business plan and program.

It’s common to confuse a strategic plan with a business plan, which is used to start a business, obtain funding, or direct operations and generally covers one year.

A strategic plan, on the other hand, is about high-level thinking and generally looks at 3 to 5 years. It can be created at any time and should be regularly revisited. Key points to review the plan include whenever a company begins a new venture (like launching a new product), if the economy or competitive landscape changes, or when new regulations or trends affect the business environment.

The Importance of Strategic Planning

Taking the time to identify exactly where your business and your executive team are headed (and how you’ll get there) can help mitigate the risks associated with business growth. In fact, the strategic planning process can fuel long-term success by bolstering these five key areas:

1. Focus And Direction

2. operational efficiency

3. competitive Environment

4. Employee morale

5. stability and longevity

1.Focus And Direction

Having a clear picture of your company’s future, plus a roadmap to get there, allows your company to be far more proactive. Rather than constantly reacting to outside forces beyond your control, you can strategically make moves designed to help you achieve your long-term objectives.

Strategic planning can even help you anticipate unfavorable scenarios before they happen and take precautions to avoid them. You can keep up with market trends and avoid common industry pain points.

2.operational efficiency

Every company has a finite amount of human and financial resources. By defining exactly what activities are needed to achieve objectives, a strategic plan helps you assess costs and means to allocate resources in the most efficient way.

CEOs must be selective about which new opportunities they invest in and which they avoid. The strategic planning process makes it clear when to spend and when to pass.

3. competitive Environment

The business landscape changes at a rapid pace. CEOs must contend with new government regulations, shifting workforce demographics, technological advances such as Facebook, and economic uncertainty. A strategic plan puts these challenges into perspective.

The process of reviewing your company’s strengths, weaknesses, and opportunities can help you rise above tricky situations. You’ll be prepared to respond to a competitor’s new product launch, a technology upgrade on your production floor, or an unhappy customer base. This degree of foresight can result in increased profitability and market share.

4. Employee Morale

The strategic plan is essential for communicating your vision to investors, managers, and employees. It ensures that all key stakeholders are on the same page, rather than struggling (perhaps inadvertently) against one another.

Even more than building consensus, the strategic planning process can improve performance. As an example, it may generate ideas for restructuring to help employees reach their full potential. Sharing realistic goals and metrics for measuring them also motivates employees to keep up their efforts.

5.stability and longevity

Running a business is a tumultuous endeavor; many CEOs are familiar with the feast-famine, boom-bust cycle. And organizations that don’t have a solid foundation—like the one a strategic plan provides—are the most likely to struggle.

According to a TAB Pulse Survey, business owners who say they have a high-quality strategic plan are much more likely to forecast sharp increases in profits and sales revenue over the next year than are owners who lack a plan.

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