The concept of “strategy” became one of the conditions of operation in the ’50s when the problem of reaction to unexpected changes in the external environment became very important. At first, the meaning of this concept was unclear. Glossaries did not help because after military use they defined strategy as “the science of deploying troops for war.” However, our main topic is the function of strategic planning and its short summary.
At the time, many directors, as well as some scholars, were skeptical of the new concept. In front of their eyes, for half a century American industry has done great work without any strategy and why did they ask the question why it suddenly became necessary and how to use it for the organization?
Rules of Decision Making of Strategic Planning:
In short, a strategy is a set of decision-making rules that governs an organization in its activities. There are four distinct groups. Such as
- Rules used to evaluate firm performance in the present and future. The qualitative aspect of the evaluation criterion is usually called the criterion and the quantitative content is the work.
- The rules by which a relationship forms with the external environment of a firm determine what kind of products and technologies it will develop, where and by whom it will sell its products, and how it will excel over competitors. This set of rules is called product marketing strategy or business strategy.
- Rules through which relationships and procedures established within the organization. They often refer to as organizational concepts.
- The rules by which the firm conducts its day-to-day operations calls basic operating techniques.
Features of Strategic Planning:
Strategies have several distinctive features. Things are better understood through the strategic management model.
- The process of strategy development does not end with any immediate steps. This usually ends with the establishment of a general direction, the progress of which will ensure the growth and strengthening of the firm’s position.
- The formulated strategy should use to develop strategic projects using the search method. The role of the search strategy is to first help focus on specific sites and opportunities; Second, to rule out all other possibilities as inconsistent with the strategy.
- The need for a strategy disappears as the real path of development leads the organization to the desired events.
- It is impossible to predict the possibilities that will open up when drafting a specific activity when determining a strategy. Therefore, one has to use highly generalized, incomplete, and accurate information about different options.
- The search process will reveal more accurate information as it reveals specific options, but it may raise questions about the validity of the initial strategic choice. Thus, successful use of the technique is impossible without feedback.
The Logic of Tactical Design:
The process of strategic planning is a tool to justify management decisions in economic activities. Its most important task is to provide the innovative and organizational changes necessary for the life of the organization. As a process, strategic planning includes four types of activities. Such as
- Resource Allocation,
- Adaptation to the External Environment,
- Internal Coordination and Control, and
- Organizational Change.
After considering all things, we can say that strategic planning is an important thing in the field of strategic management. Read more- Realist vs Visionary
