Strategic planning

Business strategic planning is a dynamic, controlled, and continuous process of review that focuses corporate thinking on consistency of purpose and long-term economic gain. It requires answers for questions like why the business exists, who its clients are, what unique PRODUCTs differentiate it from competitors, where it wants to go, what marketing and financial strategies it needs, and how the identified strategies can be implemented to move the business forward. Strategic planning has a history that dates back to the fourth century B.C., when Sun Tzu, a military strategist, wrote the classic book The Art of War, a treatise still widely read by Asian business leaders and even Western military strategists and one that contains important strategic logic applicable for both eastern and Western businesses. Early American business strategic planning centered on solving the immediate problems of SUPPLY and DEMAND, daily events, opportunities, and threats. World War II, with its logistic complexity, global orientation, and need for sophisticated technology and coordinated decision making, changed the focus of companies like Ford Motor Company to a more strategic one, though many other companies kept their primary orientation on supplying postwar consumer demand. By the 1960s the general consensus was that strategic planning was a separate and deliberate business function that could be managed to improve margins and generate revenues. Since that time, various permutations of the basic concept of strategic planning have occurred. It is theorized that strategic planning is guided by a dominant logic that exists within an organization. The three logical frameworks that govern strategic planning are capability logic, guerrilla logic, and complexity logic. Capability logic assumes the premise that businesses look for strategies that will create a sustainable competitive advantage by protecting and nurturing ASSETS, building on excellence, and creating a future that needs exactly what the business has to offer. Guerrilla logic is based on the assumption that competitive success is achieved when a business is able to generate new ideas that create new demands and new arenas of action faster than their competitors. Competitive advantage is fleeting under this framework of logic, and organizational energy is seen to be best used in transforming weaknesses rather than building on strengths. Long-term success is achieved by implementing short-term tactics that take advantage of emerging opportunities and keep the COMPETITION off balance. Complexity logic links success to the ability to understand, maintain, and encourage the individual functions of cooperation and competition as well as the creative and destructive forces that shape business systems. According to complexity logic, the success of any business is directly related to the health of the community in which it operates. Therefore the goal of a strategic plan with a complexity- logic basis would be to set in motion events that are profitable for the business and consequently favorable for the community. The first step most successful businesses take in strategic planning is to focus on the future that they want to create. In this way they are able to focus on the potential of doing things differently to provide better SERVICES, make better PRODUCTs, etc. Second, they make innovation a priority, a norm, a part of the routine; they look for the needs of clients and prospective clients, focusing not so closely on how to improve current services but more on what services clients really need. Third, they look for ways to make themselves different from and more valuable than their competitors. They set radical goals and involve participation from all levels of the business hierarchy among people who care most about the organization and its future. Often a bottom-up method is employed to generate recommendations from rank-and-file employees that are then taken to higher levels of MANAGEMENT and executive staff for further development and coordination. Finally, they develop a strategy that evolves through experimentation, thought, adjustment and implementation.