Which of the following is the process that develops creates and implements strategies for the accomplishment of objectives a leading b controlling c organizing D planning?

1. Career development
2. Strategic Planning: What Are the 7 Stages to the Process?

By Indeed Editorial Team

Updated June 27, 2022 | Published December 12, 2019

Updated June 27, 2022

Published December 12, 2019

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A team member presents project information during a team meeting as their colleagues listen from a conference table.

Strategic planning is one of a manager’s most important roles. Effective planning allows a business to accomplish its goals, as well as help teams function more effectively—with a clear plan to follow. Understanding the various steps of the planning process is key to planning well.

In this article, we explain the seven stages in strategic planning, as well as address how taking these steps and going through the entire planning process can help you be an effective manager.

What is a strategic planning process?

The primary purpose of the planning process is to help companies set goals and have an actionable plan to achieve those goals. Strategic planning can take place at every level of a company. There may be a plan in place that covers the goals of the entire organization, but there may also be plans individual managers design and implement with their teams.

The strategic planning process is integral to a company’s long-term success. With a strategic plan in place, a business can more effectively focus its energies and resources on achieving a goal. 

Read more: How To Write an Action Plan (With Template and Example)

7 stages of strategic planning

Consider the following seven steps to help you create effective, actionable plans:

1. Understand the need for a strategic plan

The first and perhaps most important step of the planning process is understanding that there's a need for a plan. In terms of management, this means that you need to be aware of the industry environment in which the business operates so that you can identify opportunities for development. You must also be aware of the business’s internal operations so that you'll know when there is a problem that needs to be solved.

After you've identified opportunities, you can begin looking at actions that would help you take advantage of those opportunities.

Example: The government is offering contracts for businesses in your industry. After becoming aware of this, you make a plan to help your business compete for a bid. 

Related: Strategic Plan vs. Business Plan: What's the Difference?

2. Set goals

Setting goals is the second step of the strategic planning process. Goals can be set for both individual departments and for the business as a whole, depending on their purpose. Continuing the example of using government bids, a company-wide goal could be to secure the bid. Meanwhile, a department's goal would be to improve specific performance metrics, such as sales or customer satisfaction.

A goal for an organization can be general, but when you're setting goals for a department, you need to be detailed and specific so that your team members will understand what they need to do. For instance, while increasing profits could be a goal for the business, the individual departments will need more detailed goals related to boosting profits, such as “We will generate an extra $5,000 in revenue by April 24.”

Read more: SMART Goals: Definition and Examples

3. Develop assumptions or premises

When you make a plan for your business, it should be done with the future in mind. Of course, the future is unpredictable, which means your plan will need to be based on certain assumptions or premises. 

A forecast is a common type of premise that involves making certain predictions about the future. If the company’s goal is to increase profits, management would need to forecast whether or not the industry would be able to support an increase in profits.

During the strategic planning process, you'll need to develop both internal and external premises. Internal premises are based on the inner workings of the company and factors. Some examples of internal premises include:

• The resources you expect to have available

• Company policies that you need or will have to implement

• How the levels of management will interact with the plan

External premises are anything outside of the company that may affect the plan and the ability to achieve set objectives. Some examples of external premises include:

• The political and social environment

• Technological advancements

• Competition from other businesses

When trying to achieve an organizational goal, it's important that all managers are operating under the same premises and that they agree with the premises.

Related: Strategy vs. Plan: Definition and Key Differences

4. Research different ways to achieve objectives

There are usually several different ways to achieve a goal. You'll need to take the time to research various ways your team could work toward completing a set objective. Researching different solutions for completing a goal is important because it gives managers some flexibility when they're directing their teams.

Some managers may prefer innovative solutions for completing goals, while others may wish to use more traditional methods. When researching different ways to achieve objectives, the goal should be to narrow options down to a few choices.

Once you've identified a few of the best ways to potentially achieve your goals, it's time to closely examine these solutions to decide which is the best option. You need to carefully consider the strengths and weaknesses of each solution, particularly as they relate to your business’s set goals.

Related: Setting Goals To Improve Your Career

5. Choose your plan of action

Once you've set your objectives, developed your premises and identified or evaluated different solutions for completing your goals, you can then decide which course of action to take. Ideally, the strategic plan that you choose is the one that will be the most profitable. Before you choose your plan of action, there are a few things you'll need to keep in mind: 

• Avoid a plan that could potentially cost the business money. This is something to consider whether it’s in the short term or the long term.
  

• Be sure you select the plan with the least amount of potentially negative consequences. Every plan you can choose will naturally have drawbacks, but some plans will have more disadvantages than others. Compare the different options for completing your goal, and choose the one that has the highest chance of success.
  

• Choose a plan of action that's adaptable. While you're executing your plan, you may encounter obstacles that you did not anticipate. If your plan is flexible, you should be able to overcome these obstacles more easily than with a plan that’s fixed.

When you form a plan of action, you should largely base your decision on concrete evidence, such as mathematical analysis. That said, your experience as a manager can also help you decide which plan is best for accomplishing your set objectives.

Example: When comparing two financial plans, you find that one has a better solution for increasing profits and the other contains an effective strategy for shielding the business from unexpected losses. You consider combining these two elements to create one strong plan.

Related: Problem-Solving Skills: Definitions and Examples

6. Develop a supporting plan

Once you know which plan you're going to implement, you may also need to develop a secondary plan to help you institute the primary plan. Secondary plans will vary depending on your objectives, so you should keep your goals in mind while developing this additional plan.

If your objective is for your company to launch a new product your main plan may include steps, such as product research, developing a marketing plan and arranging for manufacturing. The secondary plan will include all the steps you need to take to support the implementation of the main plan.

Example: You need to expand your product research team, which means hiring new employees could be a step in your secondary plan. Similarly, you need to hire a product research team as your firm doesn't already have one. Further, you need to increase your company’s manufacturing capability as your current facilities aren't suitable for the new product. With this said, training personnel is a common component of a secondary plan regardless of the goal. Whether you're trying to launch a new product or want to increase sales of a current product, your staff will likely need further training before the company will be able to achieve these objectives.

Read more: What Are the Different Types of Workplace Training

7. Implement the strategic plan

The final step of the strategic planning process is implementing the plan. In some cases, this can be the most involved step in the planning process depending on the objectives you've set. When it comes time to implement a plan, managers draw on their skill set and experiences to make sure everything runs smoothly.

If the organizational goal is particularly complex, managers will need to take the time necessary to make sure their team members understand their responsibilities and how everyone connects to the larger goal. All team members need to be informed and work together to make the project successful. The tools you'll need to implement the plan depend on the specific circumstances.

Example: Your plan is related to instituting a new company policy, and implementation of the plan will require consulting with the legal department to make sure that the policy is outlined correctly so that it will be effective.

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What is the process of strategic planning?

Is the process of setting performance objectives and determining how do you accomplish them?

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