The benefits of strategic planning

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The benefits of strategic planning v the time and effort required.

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The benefits of strategic planning

  1. 1. The benefits of 5 year strategic planning to non-financial managers versus their time and effort that this requires. John Mayfield 1
  2. 2. John Mayfield 2 Content of the presentation 1.Definition -what is strategic planning 2.The benefits of strategic planning 3.Time & effort required 4.Feedback 5.Improving the process 6.Conclusion
  3. 3. What is strategic planning? John Mayfield 3
  4. 4. John Mayfield 4 The benefits of strategic planning
  5. 5. • Purpose of the organisation more clearly defined • Improved Communication of goals & objectives to stakeholders • Greater ownership, commitment & retention among employees • Resource utilisation is improved • A baseline from which progress can be measured John Mayfield 5 Benefits of strategic planning (1)
  6. 6. Measureable output: • Actions and goals to be achieved • Resources needed to achieve goals • Funding needed to obtain resources • Links to budget & financial/operating targets John Mayfield 6 Benefits of strategic planning (2)
  7. 7. • Environment. Improved understanding of the competitive, legal, political etc. environment • Awareness. Greater awareness of strengths & weaknesses – capabilities and obstacles to exploit opportunities, react to threats • Stimulates change – better prepared for the future • A more proactive business • Survival of the organisation. • Happier stakeholders & superior performance • Failing to plan is planning to fail John Mayfield 7 Benefits of strategic planning (3)
  8. 8. John Mayfield 8 The time & effort required
  9. 9. Time & effort required (1) • Significant. 1 month+.. /people/depth • Greater effort for the first time • Time and effort depends on frequency, which is greater where products, services & environment are changing rapidly • Process repeated every 18-36 mo (‘a cycle’) • Implementation is key / quarterly review John Mayfield 9
  10. 10. Time & effort required (2) • The planning process can become long, drawn out & frustrating • Interference with day to day operations • Rigid & routine? Need for a true debate about where the organisation should be heading • Good input = better quality output/results John Mayfield 10
  11. 11. User feedback John Mayfield 11
  12. 12. Feedback • Mckinsey survey: X Only 45% satisfied with the process; However the process sets operational & financial targets & identifies priorities for the management team Can the process be improved? Probably John Mayfield 12
  13. 13. Suggestions to improve the strategic planning process John Mayfield 13
  14. 14. Improving the strategic planning process Management: • Make better use of time – advance availability of important financial & operational info’ • Team mix: knowledgeable, with skill set • Traffic coding /rotation system to ID those units to undergo full planning process • Honest, open discussion of difficult issues John Mayfield 14
  15. 15. Improving the strategic planning process Measurement: • Track strategic decisions not only by financial targets (lagging indicator), but KPIs – eg. new product revenue, retention rates • Compensation linked to progress of new initiatives – motivates and will identify any problems early on. John Mayfield 15
  16. 16. Conclusion John Mayfield 16
  17. 17. Conclusion • Failing to plan is planning to fail • Results in a clearer message, a sense of purpose & future direction • Better use of resources For better return on time & effort: • Discuss difficult issues, sacred cows • Measurement of decisions & outputs • integrate strategic planning process with HR processes – evaluation & compensation John Mayfield 17

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