what is Strategic Planning in management ? Concept, process, importance and limitations
Concepts of Strategic Planning
In other words of Glueek strategic plan is "a unified, comprehensive and integrated plan designed to assure that the basic objectives of the enterprise are achieved."
Thus, strategy plan is an integrated and unified long-range plan for a set of plans regarding the development of organisation's resources to achieve the goals of the organisation in a competitive environment.
Objectives and Importance of Strategic plan
- It provides direction to the organisation.
- It prepares organisation to face or respond environment challenges properly.
- It helps utilise in sources optimally.
- It enables organisation to take advantages of the opportunities available in the environment.
- It facilitates coordination and control
Strategy formulation/steps in the process of strategic planning
- Tar range of the products or services provided by the organisation
- Geographical coverage of the organisation, local, national or international.
Limitations of strategic planning
- Lack of knowledge: strategic planning requires lot of knowledge, training and experience. Managers should have high conceptual skills and abilities to make strategic plans and less which the desired goals will not be achieved.
- Interdependence of units: If business units at different levels(corporate levels, business level and functional level) are not coordinated, it can create problems for implementation of strategic plans.
- Managerial perception: in order to avoid risky objectives and strategies which they will not be able to achieve , managers may land up farming sub-optimal goals and plans. Sometimes, short term commitments also differ making long term strategies.
- Financial considerations: planning requires huge amount of time, money and energy, managers may be constrained by these considerations in making effective strategic plans.