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Definition of Strategic Planning

Strategic Planning is a continuous and systematic process where people make decisions about intended future outcomes, how outcomes are to be accomplished, and how success is measured and evaluated.

Key words in this definition include:

"...continuous..." Strategic planning is ongoing; it does not end with the publication of a plan; its success depends on it purposefully becoming an uninterrupted, and never-ending cycle.

"...systematic..." Any effective strategic planning process has a deliberate and specific methodology and a sequence of events; it is never haphazard.

"...process..." The value of strategic planning lies more in the journey than the destination. While strategic planning must indeed produce a product, a Strategic Plan document, the primary value comes from the teamwork, vision, commitment to and ownership of organizational success the planners gain through the process of making the decisions the document contains.

"...people..." A strategic planning process must involve all the right people, and those people must be ready and willing to contribute to the process.

"...decisions..." Strategic planning is a decision making process. Organizations that are ready to plan strategically have leaders who are ready to make decisions.

"...outcomes..." Strategic level planning addresses external results, or the organization's effects on the outside world, particularly how it affects its customers. An old adage states: "If you don't know where you're going, any road will take you there." Strategic planning is primarily about defining where "there" is, a type of roadmap outlining the outcomes and results designed to be achieved throughout the journey.

"...how outcomes are to be accomplished..." Strategic planners don't quit just because they defined the target future; they go ahead and select the roads that will get them there.

"...how success is measured and evaluated." Strategic planning is all about succeeding. A well-written strategic plan will describe clearly how anyone can tell whether the organization is successful. The plan may measure intended future outcomes either quantitatively or qualitatively, but it always defines threshold criteria for achieving success.

Strategic Planning in the Public and Not-for-Profit Sectors

Strategic planning in the public and not-for-profit sectors is different than strategic planning in private sector firms. The key difference between the two approaches include:

The public and non-for-profit sectors do not have the universal measuring tool of bottom-line profits that applies to private sector planning. Instead, planners in these two sectors must measure their ultimate success in terms of non-financial, or programmatic performance goals. This difference raises debates about what the goals should be, and what should be the intended direction of change. These debates do not typically occur in private sector strategic planning, where profit is the goal, and more profit is better than less.

Public sector stragic planners typically find themselves caught in the middle, between those who want higher program service levels, and those who want less expensive or less intrusive programs. A well-constructed strategic planning process should lead decision-makers to resolve these types of conflicts.

Blackerby Associates has had considerable success in helping client organizations to raise and resolve conflicts arising from the goal-setting process.

Private sector strategic planning also typically involves fewer people. Key strategic decision-makers in the private sector usually include members of the Board of Directors and key line and staff operating officials. Rarely, major suppliers or customers may also provide input.

Public sector strategic planning processes typically have many more people involved. In addition to Board of Directors members, line and staff operating officials, key suppliers and representatives of customer groups, other interest groups may want to have an impact on the strategic plan. These groups may include funding sources, administration representatives, competitive private sector service providers, members of the regulated community, customers of the regulated community, environmental groups, public safety groups, and conservative and liberal political organizations. An effective strategic planning process should provide for orderly ways to receive the input from these disparate interests.

Blackerby Associates has helped many organizations to design and implement open strategic planning processes that receive and process input from a wide variety of related interests.

Strategic Plan Elements

The Blackerby Associates Strategic Planning Cycle contains 8 elements: the first, the plan-to-plan, is unique to the Performance Strategies model; the other seven elements include: mission, needs assessment, strategic objectives, outcome measures, strategic priorities, strategies and performance feed-forward.

Figure 1. shows how these elements relate to each other. The arrows indicate the general sequence of the elements, but planners often find themselves backing up to re-examine an element they had already drafted. The elements are iterative, and truly a "continuous process."

Figure 1. Blackerby Associates Strategic Planning Cycle

A brief description of each element follows:

  • The plan-to-plan is a project plan that describes how the organization will develop its strategic plan.
  • The mission, goals and values element always begins with the mission, the broadest possible description of the organization's vision of its future. Also, organizations may want to define goals in this step: written statements describing the external direction of success, ultimate achievement, or improvement in organizational performance. In addition, Values are written statements describing the principles the organization wants to express as it works to move in the direction described in the goals.
  • External needs assessment is an appraisal of the key outside trends and forces that influence the success an organization will have in achieving its mission and goals. These external trends and forces may pose either an opportunity or a threat to the organization, such as changes in economic conditions, population, technology, environment, or statutes. Some planners call this element an "environmental scan."
  • Strategic objectives are written statements that describe an intended outcome. They clearly describe measurable targets of achievement.
  • An outcome measure is a yardstick, or standard, used to measure success in achieving a strategic objective. It measures how well an organization is doing. As one type of performance measure, it indicates the actual impact of the organization's activities. Every strategic objective has an accompanying outcome measure, and the outcome measure uses terms identical to the strategic objective it measures. By comparing the quantity or quality in the outcome measure to the strategic objective's performance target, management can state clearly whether or not the organization achieved its strategic objective.
  • Strategic priorities rank each strategic objective according to its relative importance to the organization. Setting strategic priorities is a management decision. These priorities will guide budget and resource requirement decisions later.
  • Different strategic planners use and define "strategies" in many different ways. In the Performance Strategies model, a strategy is an approach, or an implementation methodology, that will lead to achieving a strategic objective.
  • In the strategies element, planners identify all the alternative approaches, rate them according to criteria such as timeliness, projected cost or effectiveness in achieving a strategic objective, and then select a set of strategies that will best achieve the performance target specified in the strategic objective.

  • Performance feed-forward is a systematic procedure for comparing actual performance to planned performance, and for using that information to improve subsequent planning cycles. Other terms frequently used to describe this procedure include program evaluation, management evaluation, management audit or continuous improvement processes.