Each manager and director of the organization must prepare a strategic plan for the development of the company. Strategic planning often involves planning resources, projects, and staff.
The manager and the director must be aware of the goals to be able to adequately prepare the plan. Once you have a ready organizational plan, you need to implement it. And the implementation of the strategic plan is subject to evaluation and control of implementation.
Evaluation and control are usually again performed by managers and directors, but can also be performed by external stakeholders or other internal managers and directors of the organization. Reference: “Planning a project in Agile Management: Research and deliverables”, https://bvop.org/learn/pmplanning/
Strategic planning only makes sense when it is put into practice. To avoid disorientation and misinterpretation of the plan and objectives, management should develop additional plans and specific guidelines that will lead to the implementation of the objectives of the strategic plan of the organization.
Basic components of planning
The main components of formal planning are – tactics, policy, procedures, and rules. Tactics are called short-term strategies. It is being developed to implement the strategy.
It is prepared at the middle level in the organization, unlike the strategy, which is set by the top management. It is developed for a shorter period. Unlike strategic results, tactical ones manifest themselves much faster.
To avoid disorientation, management should also resort to developing additional guidelines. This role is played by politics. It is formulated by senior management over a long period and explains how the goals should be achieved. Eg. – providing equal employment opportunities for minority groups and women.
However, politics alone is not enough to guide action in an organization. When there is a tendency in the organization to frequent repetition, standard guidelines are developed, which for short are called procedures.
They describe the actions that need to be taken in a specific situation. They are rather programmed solutions.
The rules determine exactly what needs to be done in a particular situation. They differ from the procedures in that they relate to a specific and specific issue. When the organization’s management wants to limit the actions of its associates to ensure that specific actions are performed in specific ways, it develops rules. Eg. – the requirements for holding a certain position – by gender, age, length of service, specialty, etc.
Deciding to occupy a certain job, the decision-maker cannot deviate from them. Of course, there are also problems related to the application of rules and procedures, which are mainly psychological. The reason for their occurrence is primarily their presentation by the management of the employees.
Methods in the process of implementing the strategic plan
Two of the most common methods that provide a high degree of coherence in the process of implementing the strategic plan are – budgeting / ie. resource allocation / and management by objectives.
A budget is a method of allocating resources in the quantitative form to achieve quantified goals. It is the most widely used element of formal planning. The first step in developing a budget is to quantify both resources and formulated goals.
The stages of budget development are several: the first stage is characterized by forecasting sales volume; on the second – a draft budget is developed for a certain period; at the third stage – a final version of the organization’s budget is developed; at the fourth stage – the management approves the final budget; the fifth stage involves the implementation of the budget.
Management of the goals of the organization
In goal management/target management / the main attention is paid to the attempts to predict the future and to react to it. It is oriented towards the final results. Each subordinate leader, realizing his goals, also carries out the fulfillment of the goals of his direct superior.
This method allows the manager to be judged on the results achieved and not on personal qualities. Target management is a process that consists of four interdependent related stages – formulation of short and clear goals; action planning; inspection and evaluation of work and corrective measures.
The evaluation of the strategic plan
The evaluation of the strategic plan is of great importance for its successful implementation. The evaluation is done by comparing the results of the work with the goals of the organization.
For an assessment to be effective, it must be done systematically and continuously. When evaluating the strategic planning process, it is necessary to answer the following five questions:
- Is the strategy compatible with the capabilities of the organization?
- Does the strategy assume an acceptable level of risk?
- Does the organization have enough resources to implement the strategy?
- Does the strategy take into account external dangers and opportunities?
- Is the strategy the best way to use the organization’s resources?
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The evaluation of the strategy is done with the help of criteria that have a quantitative and qualitative character. Quantitative criteria are – market share, sales growth, lost days due to strikes, cost level, staff turnover, absenteeism, net profit, share price, and more.
Qualitative criteria are – the ability to attract highly qualified managers, expanding the volume of customer services, deepening knowledge of the market, reducing the number of hazards, using opportunities, etc.
A serious factor in evaluating the strategy is the time factor.