importance of strategic planning essay

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Why Is Strategic Planning Important?

• 06 Oct 2020

Do you know what your organization’s strategy is? How much time do you dedicate to developing that strategy each month?

If your answers are on the low side, you’re not alone. According to research from Bridges Business Consultancy , 48 percent of leaders spend less than one day per month discussing strategy.

It’s no wonder, then, that 48 percent of all organizations fail to meet at least half of their strategic targets. Before an organization can reap the rewards of its business strategy, planning must take place to ensure its strategy remains agile and executable .

Here’s a look at what strategic planning is and how it can benefit your organization.

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What Is Strategic Planning?

Strategic planning is the ongoing organizational process of using available knowledge to document a business's intended direction. This process is used to prioritize efforts, effectively allocate resources, align shareholders and employees on the organization’s goals, and ensure those goals are backed by data and sound reasoning.

It’s important to highlight that strategic planning is an ongoing process—not a one-time meeting. In the online course Disruptive Strategy , Harvard Business School Professor Clayton Christensen notes that in a study of HBS graduates who started businesses, 93 percent of those with successful strategies evolved and pivoted away from their original strategic plans.

“Most people think of strategy as an event, but that’s not the way the world works,” Christensen says. “When we run into unanticipated opportunities and threats, we have to respond. Sometimes we respond successfully; sometimes we don’t. But most strategies develop through this process. More often than not, the strategy that leads to success emerges through a process that’s at work 24/7 in almost every industry.”

Strategic planning requires time, effort, and continual reassessment. Given the proper attention, it can set your business on the right track. Here are three benefits of strategic planning.

Related: 4 Ways to Develop Your Strategic Thinking Skills

Benefits of Strategic Planning

1. create one, forward-focused vision.

Strategy touches every employee and serves as an actionable way to reach your company’s goals.

One significant benefit of strategic planning is that it creates a single, forward-focused vision that can align your company and its shareholders. By making everyone aware of your company’s goals, how and why those goals were chosen, and what they can do to help reach them, you can create an increased sense of responsibility throughout your organization.

This can also have trickle-down effects. For instance, if a manager isn’t clear on your organization’s strategy or the reasoning used to craft it, they could make decisions on a team level that counteract its efforts. With one vision to unite around, everyone at your organization can act with a broader strategy in mind.

2. Draw Attention to Biases and Flaws in Reasoning

The decisions you make come with inherent bias. Taking part in the strategic planning process forces you to examine and explain why you’re making each decision and back it up with data, projections, or case studies, thus combatting your cognitive biases.

A few examples of cognitive biases are:

• The recency effect: The tendency to select the option presented most recently because it’s fresh in your mind
• Occam’s razor bias: The tendency to assume the most obvious decision to be the best decision
• Inertia bias: The tendency to select options that allow you to think, feel, and act in familiar ways

One cognitive bias that may be more difficult to catch in the act is confirmation bias . When seeking to validate a particular viewpoint, it's the tendency to only pay attention to information that supports that viewpoint.

If you’re crafting a strategic plan for your organization and know which strategy you prefer, enlist others with differing views and opinions to help look for information that either proves or disproves the idea.

Combating biases in strategic decision-making requires effort and dedication from your entire team, and it can make your organization’s strategy that much stronger.

Related: 3 Group Decision-Making Techniques for Success

3. Track Progress Based on Strategic Goals

Having a strategic plan in place can enable you to track progress toward goals. When each department and team understands your company’s larger strategy, their progress can directly impact its success, creating a top-down approach to tracking key performance indicators (KPIs) .

By planning your company’s strategy and defining its goals, KPIs can be determined at the organizational level. These goals can then be extended to business units, departments, teams, and individuals. This ensures that every level of your organization is aligned and can positively impact your business’s KPIs and performance.

It’s important to remember that even though your strategy might be far-reaching and structured, it must remain agile. As Christensen asserts in Disruptive Strategy , a business’s strategy needs to evolve with the challenges and opportunities it encounters. Be prepared to pivot your KPIs as goals shift and communicate the reasons for change to your organization.

Improve Your Strategic Planning Skills

Strategic planning can benefit your organization’s vision, execution, and progress toward goals. If strategic planning is a skill you’d like to improve, online courses can provide the knowledge and techniques needed to lead your team and organization.

Strategy courses can range from primers on key concepts (such as Economics for Managers ), to deep-dives on strategy frameworks (such as Disruptive Strategy ), to coursework designed to help you strategize for a specific organizational goal (such as Sustainable Business Strategy ).

Learning how to craft an effective, compelling strategic plan can enable you to not only invest in your career but provide lasting value to your organization.

Do you want to formulate winning strategies for your organization? Explore our portfolio of online strategy courses and download the free flowchart to determine which is the best fit for you and your goals.

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The Importance of Strategic Planning

Every successful business has a plan and knows where it is heading in the future. Setting a plan with goals, target dates, and a purpose should be finalized before embarking on a business. Taking the time on an ongoing basis to review the company's past performance, and predict its future performance, gives it a road map to follow.

Without strategic planning , which is knowing the current state of your business and where you want it to go, most businesses will fail. A strategic plan allows you to see what is important, how to get there, the pitfalls to avoid, and the noise to ignore. Below we discuss some of the reasons why strategic planning is important and how to implement it.

Key Takeaways

• Strategic planning is crucial for a business as it creates a map for a business to follow and course correct when need be.
• The first part of a strategic plan is the business plan, which outlines the purpose of the business, budgets, goals, and the mission statement.
• Making time to evaluate your business on an ongoing basis will allow you to determine how well your results are adhering to your plan. This will allow you to make adjustments or double-down on how the business is being run.
• Communicating your strategic plan to your employees is critical so that everyone is on the same page and working towards the same goals.
• Reviewing and following up on your business will highlight strengths and weaknesses in your business so that you can continue with what works well and eliminate what is hindering the growth of your business.

The very first strategic planning most businesses do is a business plan . When you first start your business, you will likely have prepared a mission statement , a budget, and a marketing and promotion plan. The business plan is a good first step, but it needs to be reviewed and updated as the business continues and grows. If you shove it in a drawer and let dust gather on it, it won't serve as the foundation of your business, as it was meant to.

A business plan serves as the blueprint for a company's success, providing a comprehensive roadmap that outlines its objectives, strategies, and tactics for achieving growth and profitability. In some cases, a business plan is also necessary for attracting external funding and support from an outside investor or bank.

How you go about conducting strategic planning will depend on many variables, including the size of your business, the time frame included, and your personal preferences. The most common style of plan is goals-based. In this type of plan, you set goals for the business (financial and non-financial) and map out the steps needed to meet those goals.

For example, if your goal is to have $100,000 in revenues next year, the steps to get there might include bringing in five new clients a month and attending three trade shows. Whatever the goals you set for your business, they should be concrete and measurable so that you know when you reach them. Another method of strategic planning is mission-based.

When you first started your business, you likely developed a mission or values statement, outlining the purpose of your company and its overall reason for being. A mission-based strategic plan ties each part of the plan into the mission, to ensure that the company is always operating in the service of that mission.

For example, if your mission statement is to be recognized as a leader in the financial services sector and to help families become financially independent, your strategic plans should address how you will meet those goals.

It can be difficult to find the time to plan your business. Other, more pressing priorities, like trying to bring in revenue , may grab your attention; however, carving out time regularly will help you keep on top of your business.

Blocking off a few hours a day or week to focus on your plan should be part of your business operations. During that time, you can examine the prior week's financial performance and update any marketing initiatives to make sure that your business is on track with your initial plan. If it's not, then you'll need to make adjustments to get back on track.

Regardless of how often you plan, make sure that you set it in stone in your day planner. Block off the time and don't let anything else get in the way. Turn off your cell phone and, if at all possible, go somewhere away from your office to plan in order to minimize distractions.

As a business owner, you will most likely have employees. It is critical to inform them of your strategic plan so that they are on the same page and working towards the same goal as you.

Including your staff in your strategic plan will instill a feeling of responsibility in their jobs that will help ensure productivity.

For example, if you have a sales team and your strategic plan involves bringing in five new clients a month, your sales team needs to be aware of this so that they know the goal to achieve. If they don't, perhaps they would be under the assumption that bringing in two new clients a month is excellent, when in actuality, it is only 40% of your goal. Without clear communication to your employees, your business will be a boat set adrift without any course to follow.

A critical part of the planning process is reviewing your previous plan and comparing it to your actual results. Were you able to bring in five new clients last month? If not, why not? Tweak the plan going forward to account for changes in your business or the general economic climate. The more experience you get with the planning process and with the operational side of your business, the more accurately you will be able to plan.

Once you have had your business running for a while and block out time to follow up on your strategic plan, you will be able to determine where the strengths and weaknesses in your business lie. This would allow you to correct course, perhaps changing your business plan and goals slightly to focus on your strengths, while allowing you to eliminate your weakness, making your business stronger and increasing the likelihood of achieving your goals.

Why Is Strategic Planning Important for Businesses?

Strategic planning is crucial for businesses because it provides a roadmap for achieving long-term objectives, identifying opportunities, and mitigating risks. It helps align organizational resources, activities, and goals, ensuring that everyone is working towards a common vision.

What Are the Key Benefits of Strategic Planning?

The key benefits of strategic planning include improved decision-making, enhanced resource allocation, increased organizational alignment, better risk management, and the ability to seize opportunities for growth and innovation.

What Are the Risks of Not Having a Strategic Plan in Place?

Without a strategic plan, organizations may struggle to maintain focus, allocate resources efficiently, or adapt to changing circumstances. They may miss opportunities for growth or become vulnerable to competitive threats. Companies with a strategy may be more likely to face challenges in sustaining long-term success.

What Are Some Best Practices for Effective Strategic Planning?

Best practices for effective strategic planning include involving key stakeholders in the process and conducting thorough environmental scans to fully understand all aspects of a company that will be impacted. This can be done through a SWOT analysis. Once your strategy is in place, set clear and measurable objectives, regularly monitor progress, and don't be afraid to realign the strategy with new information as it comes available.

Planning out the future of your business is the best way to ensure success. Creating an initial plan and communicating that plan to your employees will ensure that everyone is working towards the same goal.

Taking out time to review your business's results and comparing them to your plan will help ensure that the right policies and procedures continue whereas those that are not benefiting the company will be removed. It may seem awkward and difficult at first to create a strategic plan, but with practice, you will be able to move your business in the right direction.

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116 Strategic Planning Essay Topic Ideas & Examples

Inside This Article

Strategic planning is a critical process for any organization looking to achieve its long-term goals and objectives. It involves setting priorities, focusing resources, and ensuring that everyone is working towards a common vision. However, coming up with strategic planning essay topics can be challenging. To help you get started, here are 116 strategic planning essay topic ideas and examples:

• The importance of strategic planning in organizations
• The key components of a strategic plan
• How to develop a strategic plan for a small business
• The role of leadership in strategic planning
• The benefits of strategic planning for nonprofits
• The connection between strategic planning and organizational success
• How to create a strategic plan that is flexible and adaptable
• The challenges of implementing a strategic plan
• The impact of external factors on strategic planning
• The role of data and analytics in strategic planning
• The link between strategic planning and financial performance
• The importance of employee involvement in strategic planning
• The role of communication in strategic planning
• The connection between strategic planning and risk management
• The impact of technology on strategic planning
• The role of strategic planning in crisis management
• The connection between strategic planning and innovation
• The role of strategic planning in sustainability initiatives
• The benefits of strategic planning for government agencies
• The challenges of strategic planning in a globalized world
• The role of strategic planning in mergers and acquisitions
• The importance of strategic planning in the healthcare industry
• The connection between strategic planning and customer satisfaction
• The impact of organizational culture on strategic planning
• The role of strategic planning in talent management
• The benefits of strategic planning for educational institutions
• The challenges of strategic planning in a rapidly changing environment
• The role of strategic planning in the public sector
• The connection between strategic planning and corporate social responsibility
• The importance of strategic planning in the hospitality industry
• The impact of strategic planning on supply chain management
• The role of strategic planning in brand management
• The benefits of strategic planning for startups
• The challenges of strategic planning in a competitive market
• The connection between strategic planning and organizational culture
• The role of strategic planning in strategic alliances
• The importance of strategic planning in the retail industry
• The impact of strategic planning on employee engagement
• The role of strategic planning in performance management
• The benefits of strategic planning for small and medium-sized enterprises
• The challenges of strategic planning in a family-owned business
• The connection between strategic planning and succession planning
• The role of strategic planning in crisis communication
• The importance of strategic planning in the technology sector
• The impact of strategic planning on organizational structure
• The role of strategic planning in cost management
• The benefits of strategic planning for not-for-profit organizations
• The challenges of strategic planning in a regulated industry
• The connection between strategic planning and market research
• The role of strategic planning in project management
• The importance of strategic planning for the automotive industry
• The impact of strategic planning on customer retention
• The role of strategic planning in change management
• The benefits of strategic planning for a global organization
• The challenges of strategic planning in a decentralized organization
• The connection between strategic planning and business ethics
• The role of strategic planning in product development
• The importance of strategic planning in the pharmaceutical industry
• The impact of strategic planning on employee motivation
• The role of strategic planning in digital transformation
• The benefits of strategic planning for the manufacturing sector
• The challenges of strategic planning in a government agency
• The connection between strategic planning and customer loyalty
• The role of strategic planning in marketing strategy
• The importance of strategic planning in the energy sector
• The impact of strategic planning on organizational performance
• The role of strategic planning in diversity and inclusion initiatives
• The benefits of strategic planning for the financial services industry
• The challenges of strategic planning in a non-traditional organization
• The connection between strategic planning and employee training
• The role of strategic planning in organizational development
• The importance of strategic planning in talent acquisition
• The impact of strategic planning on employee retention
• The role of strategic planning in corporate governance
• The benefits of strategic planning for the real estate industry
• The challenges of strategic planning in a startup environment
• The connection between strategic planning and competitive advantage
• The role of strategic planning in supply chain optimization
• The importance of strategic planning in project portfolio management
• The impact of strategic planning on organizational culture change
• The role of strategic planning in performance improvement
• The benefits of strategic planning for the technology sector
• The challenges of strategic planning in a regulated market
• The connection between strategic planning and organizational resilience
• The role of strategic planning in leadership development
• The importance of strategic planning in corporate social responsibility
• The impact of strategic planning on organizational agility
• The role of strategic planning in capacity planning
• The benefits of strategic planning for the healthcare industry
• The challenges of strategic planning in a global organization
• The connection between strategic planning and crisis response
• The role of strategic planning in talent retention
• The importance of strategic planning in strategic partnerships
• The impact of strategic planning on organizational innovation
• The role of strategic planning in value creation
• The benefits of strategic planning for the hospitality industry
• The challenges of strategic planning in a rapidly changing market
• The connection between strategic planning and market segmentation
• The role of strategic planning in customer acquisition
• The importance of strategic planning in supply chain resilience
• The impact of strategic planning on organizational learning
• The role of strategic planning in organizational change management
• The benefits of strategic planning for the retail industry
• The challenges of strategic planning in a family-owned company
• The connection between strategic planning and brand positioning
• The role of strategic planning in employee development
• The importance of strategic planning in customer relationship management
• The impact of strategic planning on organizational sustainability
• The role of strategic planning in competitive intelligence
• The benefits of strategic planning for the public sector
• The challenges of strategic planning in a non-profit organization
• The connection between strategic planning and organizational effectiveness
• The role of strategic planning in organizational alignment
• The importance of strategic planning in organizational restructuring
• The impact of strategic planning on organizational resilience
• The role of strategic planning in organizational performance management

These strategic planning essay topic ideas and examples can serve as a guide for your next writing project. Whether you are exploring the benefits of strategic planning in a specific industry or analyzing the challenges of implementing a strategic plan, there are plenty of topics to choose from. Remember to conduct thorough research and analysis to support your arguments and provide valuable insights to your readers.

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Importance of Strategic Planning Essay Example

• Pages: 4 (884 words)
• Published: November 9, 2017
• Type: Case Study

Strategic planning focuses on stabilizing the current environment and supports the organization's business plans and goals. It helps implement new projects, technology, and consolidation efforts. Strategic planning also considers data growth, cost management, and resource allocation for future needs. This process analyzes the business plan and addresses any obstacles or issues in current architecture and processes. It aids in formulating ideas about key factors affecting both present and future development of the organization, as well as opportunities in the environment and organizational capabilities. Strategic planning plays a crucial role in solving strategic tasks by maintaining a balance between goals and resources in a changing market.

Strategic planning is a vital aspect of strategic management, as it helps determine the most promising areas for a company's growth and prosperity. It is considered the most important function within a company, and it encompasses the

planning, organizing, leading, and controlling aspects of management. The value of strategic planning arises from several reasons, including recognizing that an organization is an open system that relies on external factors for success. Strategic planning also enables companies to effectively respond to uncertainty and risk in the external environment. Given the difficulty of predicting the future, strategic planning incorporates scenario and situational methods to address this challenge. Additionally, an organization's ability to adapt to environmental changes is crucial for it to respond effectively.

• Strategic planning and long-term planning have become the main focus for many companies. An effective strategic plan will include long-term planning as well as other strategic initiatives, such as growth.

Strategic plan characterizes the activity of organizations in the market using the following paradigm: "Tomorrow will not necessarily be better than today". This

means that relying solely on past information and learned development patterns for long-term planning is no longer effective.

Strategic planning involves analyzing various prospects for a company based on changes in the environment. The key element of this analysis is determining the organization's position in the market competition. Based on this analysis, certain directions of activity and strategies are formed to achieve goals. Strategic planning also involves deciding which directions of activity to develop and which to eliminate in order to adapt to the ever-changing environment and seize new opportunities. Implementing organizational strategies is crucial for planning. Urbany and Davis (2007) emphasize that while most executives understand the importance of building a distinct competitive advantage for long-term growth and profitability, many have a vague understanding of what this actually entails.

This activity involves the systematic development of thinking among managers by creating a learning organization that can benefit from previous strategic decisions. Learning from experience helps organizations correct their strategic goals and improve professionalism in strategic management. An organization's success creates a continuous desire for management to learn from experience and predict the future. However, strategic planning alone cannot provide a complete picture of the future. The outlook provided by strategic planning only presents an overall scenario that can be categorized as a possibility. Strategic planning combines intuition and the art of setting and achieving goals through analyzing and planning skills. While the development of a plan is often emphasized in strategic planning, the most crucial aspect is implementing this plan.

In order to realize chosen strategies and achieve flexibility within an organization, it is necessary to create an organizational culture that utilizes all the tools of strategic

management and forms a system of motivation. Strategic planning involves several stages, including cause and effect purpose which aims to identify the most important input variables that explain variations in outputs. Priority is determined by considering the importance to customers and the strength of correlation. Another stage is Failure Mode and Effects Analysis (FMEA), which identifies primary causes of high priority defects.

Next, charts are used to determine whether a relationship exists between an input variable and the output variable. Finally, hypothesis testing is conducted to test claims about population parameters. This includes testing if an observed process change, based on sample data, is real. In conclusion, "Strategic planning has consistently been rated as a power tool by nearly all managers in all industries and company sizes" (Rigby D., 2007). Strategic planning provides an overall picture from a 30,000 foot level. Often, managers, executives, or directors within a company learn through trial and error.

When a concern or complaint is raised, these key employees must step back and ask focused questions until the situation is resolved. Managers are able to execute through instinct in this case. However, no matter how one prepares, either through education or experience, one must always expect the unexpected. Sandenaw (2007) advises, "Plan to leave some unassigned resource capacity." When complaints or concerns develop, even those issues seemingly as easy as someone not being happy with a certain system, or request for a change to how something looks visually when presented to the industry or the customer base, companies can use strategic planning to work out where they have been and where they are currently in the business environment.

Examining a company's past is

a crucial step in evaluating it analytically. The company achieves its competitive advantage by consistently allocating limited resources to its value-adding activities. By doing so, the company can satisfy customer desires by offering superior products and services, while also sustaining business growth and adhering to its strategic plan.

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The Importance of Strategic Management Essay

Strategic management affects organizational performance and allows a company to create strategic short-and long-term plans. Following Dobson and Starkey (2004) “Governing the choice between strategic options should be the notion of competitive advantage. The firm has to identify unique opportunities for itself in its chosen area” (p. 9). Two functional areas, personal and accounting, determine the organizational success and performance of every company. Personal functional areas require flexibility and autonomy of decision-making. In this case, strategic management allows companies to determine long-term objectives and foreshadow possible short-term changes and cultural variations.

The business intelligence system is extremely important in providing the input for such an assessment. Position, environmental, and projected intelligence are the bases of determining planning constraints. All plans and corporate goals are fulfilled by personal, so it is crucial to take into account cultural and social variations, rewards, and promotions issues. A personal functional area guides directional and fundamental planning activities of the firm, and are concerned with such problems as to whether to diversify and, if so, into what lines; whether new products should be added; whether acquisitions should be undertaken; where marketing investments should be directed; and, in general, the future orientation of the company. To a very large extent, success in managing a marketing operation depends on combining, integrating, and coordinating human resources that will achieve company goals (Thompson and Martin 2005).

The accounting functional area helps a company to determine its performance and foreshadow strategic directions. Strategic decisions regarding major directions of an organization are contrasted with tactical decisions that carry out the strategies. Reciprocal decisions, in which one individual interacts with another and causes a reaction (such as competition), are distinguished from controlling decisions, in which one person’s actions control the actions of another without interaction. Sequential decisions involving multiple actions and reactions, like those in the marketplace, are differentiated from single decisions. Accounting is very important for strategic management because it determines possible threats and opportunities for investment and financial performance. The latter can be judged on the basis of efficiency; the former depends on normative values. Accounting involves such estimations as return on capital employed’ (RO(K:), ‘return on investment (ROI) or ‘economic profit’.

Using historical records and data analysis techniques, a company can choose the best possible direction for its strategic growth and development. Income cases, a number of subsequent plans and establish the limits and ranges of optional choices. They involve the greatest risk since they bound the decision and planning area and give direction to the total marketing effort. Strategic plans are broad and comprehensive; they are the master plans (Dobson and Starkey 2004). For global corporations, long-range planning and capital budgeting tend to center on the local host country. The corporate plan aggregates planning for individual host country operations. Local conditions on costs and other markets that can best be provided by local managers are needed so that global alternatives can be evaluated. Budgets offer another practical, although the possibly less effective, approach to the evaluation of managers and units of multinational corporations. It would seem that the profit plan should be constructed in a participative manner between different management levels. Budget variances for aspects that are under local control can then be the basis for performance evaluations (Drejer, 2002). Both personal and accounting functional areas help strategic planners to encompass the search for market opportunities, the development of general guiding directions, the scope of activities, and the goals to be achieved.

Dobson, P., Starkey, K. (2004). The Strategic Management: Issues and Cases . Blackwell Publishing.

Drejer, A. (2002). Strategic Management and Core Competencies: Theory and Application . Quorum Books.

Thompson, J. L., Martin, F. (2005). Strategic Management: Awareness, Analysis and Change. Thomson Learning.

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Business Strategy

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Why strategic planning is crucial?

Strategic planning is an organisational culture where a strategy is defined. A businessman decides to acquire resources to pursue a plan. Strategic planning consists of two words:- strategy and planning. Strategy is a blueprint of actions for achieving long-term goals and planning is the thinking process and organising of required actions to achieve those goals.

This is a fundamental step in achieving a long term set business goal or in other words, the conversion of a business vision in clearly defined objectives and goals and a sequential set of step-by-step plan to achieve that long term vision. It is a very flexible way of attempting for a business growth and takes into account a wider picture a dream. There are various benefits and importance of undergoing a strategic planning process, major ones are enlisted below:

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1. Systematic Proven Business Tool

Strategic Planning is a traditional means used over a long span of time by the business leaders and managers to create milestones and give business new heights. This is a very systematic organizational blueprint consisting of step-by-step activities to be undertaken by the team to achieve their long term business goals. Being systematic is its major benefit that helps the managers to clearly define the directions of their business decisions one after the other without any chaos, ambiguity and stress. This has been proven overages that, for achieving a long term vision, there is a need to define sequential missions broken in a set of easily achievable goals over a period of time.

2. Missing Opportunities

With the help of a finely created business strategy plan, one can take an advantage of one of the premium opportunities arising all of a sudden or in the near future out of external environmental factors. With a plan the business is able to extract benefits out of the competitive and tough situation and treating it as a challenge rather than taking it as a threat to the organization. Such windfall opportunities can prove to be a boon for the business if attempted for in time like buying a competitor's stock and assets in a liquidation sale or hiring employees of a closed down plant of rivals.

3. Focus on problem solving

With strategic planning process one takes into account a long term view of the business operations and its model. There can be some consistent minor problems that prevent the business from achieving its highest efficiency and thereby stopping from maximizing the organizational success which can be solved by strategic planning process focussing on the root cause of the problem from choosing short term measures to solve the issue. When the things are organized the issues can be sorted out on a permanent basis, which not only cut down the present cost, but enables to have a different outlook for future organizational growth.

4. Enables creating a fine and clear strategy

Clear strategic plans not only benefit the business or its shareholders, but the stakeholders at large. With a clear business strategy the employees and managers get a clear idea about their roles, targets and performances. Like the short term plans detail about the achievement of a business goal over a span of a few months like business targets, deadlines, etc. Whereas, the other may comprise of the longer span of time over next 5-10 years, which may comprise of expansion strategies, new product development, market development, business acquisitions and mergers, marking national or a global presence, etc.

5. Proactive business tool

With a systematic and clear strategic plan the managers are not only able to attend to the current business conditions and situations, but also address future activities based on the upcoming industry scenarios and factors. This helps the business leaders to attempt for a quick and appropriate move at the very initial stage of business downtime or tough industry recession. These finely planned moves not just save the business through a tough time, but also enable it to maintain a strong and stabilized position over its competitors and rivals. This helps capitalize the brand development of a business.

6. Appropriate allocation of resources

Systematic planning, directed activities and properly thought upon business decisions, not only help the business to allocate its resources in an efficient way but also enable it to judiciously make use of its assets with the motive to maximize its output and minimize its wastage. With this the capital and interest cost goes down rising the short term profits and long term stakeholders’ returns. When the current resources are rightly and properly allocated it opens up the ways for new sources of resources available to the business which enhances its capital base, opens up new avenues of opportunities and assure of more stakeholder’s value generation.

7. Measurable means of business performance

Strategic planning as read above is a step-by-step plan of the long term vision of the business which means it is broken down into smaller and more easily achievable missions or business goals over a short span of time. This enables to measure the performance of the business over the series of these short term business targets. This will enable a manager to sketch the picture of the business growth in terms of profits, shareholder value or turnover, etc. achieved in these fragmented time frames. This will therefore form base of the business statistics and will help to frame the future moves and suggest for better or changed business activities for achievement of that long term objective.

8. Flexible yet disciplined means

Though this is a measurable tool in case of any variation in the targeted business goal a strategic plan will enable to take a changed business move in order to achieve same long term business goal may be with a different set of actions. Thus it facilitates any changes to be made to the current set of actions or plans for a more flexible approach for reaching a same destined goal with more disciplined efforts and spirits. This way of moulding in order to remain on the same path to attain the thought of aim keeps the discipline in the hierarchy and the structure of working.

9. Simplified yet motivating

The strategic plan is based on the concept of simplifying the complex goal into fragments of simple and understandable sections of smaller targets. This helps to understand the complex whole picture in an easier way by breaking down into sections. This one-by-one fragmentation is called mission creation which is taken one after the other not only simplifying the process of achievement, but also keeps the spirits of the business leaders and stakeholders high on analysing the business performance. On being able to measure the acts and then compiling a set of scorecard, the team gets motivated on achieving more and higher targets for growth and development of all at the same plane.

10. A competitive edge over rivals

When a business leader has a plan which is systematically made to cover his long term vision and is finely crafted in sections to elaborate its small, thoughtful goals, he has better and higher chances of extracting from the upcoming opportunities and fighting back the threats or converting them to their advantage. This strengthens the business position over its competitors and rivals and reduces the changes of failures and weak decisions resulting in loss. A more stable and strong position is a threat to the competitors as that helps to sustain a longer market presence, stronger brand image and higher stakeholder loyalty.

11. Enables Follow-up and change implementation

The strategic planning process is based on goals which are nothing but just the small pie’s in a big cake which are achieved over a span of time to form that Big chocolate cake. For example the wider vision is to capture the national market over the span of the next 20 year. Now to achieve that vision missions are created for yearly basis, which starts from getting a specific number of clients every month to achieve a budgeted turnover every year. These smaller goals help to evaluate the route covered over the map to achieve that desired destination. Following up with these statistics and measuring these smaller missions’ enables business leaders to make appropriate changes to their current plans to facilitate better and efficient steps to be taken in the targeted growth. Following up is an essential activity to keep up with the right track and reach the decided destination or goal by making necessary changes to the current plan and set of activities.

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Product Lifecycle Phases and Their Importance

1. introduction.

The product lifecycle, in a marketing context, is a method which is used to find the competitive advantage a business has. The marketing activity of a business is determined by the life cycle of the product it is selling and as the product passes through its life cycle, the strategy will alter and the marketing mix will vary. The concept of product lifecycle involves an attempt to move consumers to different stages, to 'steal' customers from other products in different stages and to take customers back to a previous stage. This can be done using various pricing and other strategies. An understanding of the product lifecycle and how to market at different stages is crucial to a business, enabling it to maintain and increase sales of a product and thus secure its future. The product passes through four key phases in its life: introduction, growth, maturity, and decline, with each phase requiring a different marketing mix and marketing strategy to maintain sales and profitability. Development plays a key role in any product's success, how long it lasts and what sort of an impact it will have on the company and the consumer. During this period, any intellectual property is legally protected and the new product is developed, usually incurring high costs and little reward until the product is launched. This first phase is often skipped as it will be started again later when the product idea has been ascertained. The first logical step in the product lifecycle is the introduction of a product to the market. This is where a company will incur heavy marketing and production costs. The objective for a company here will be to inform consumers of their product and what it can do for them, gaining consumers who are 'switching' from a similar product and taking others consumers from competing products. Pricing is often low and high sales are required just to break even. Widespread distribution is essential which will involve deals with retailers and incentives for them to sell the product. This phase will determine the success of a product and can often be quite a risky period for a company. Only when a small company can generate enough profit and larger companies incur relatively low costs, will the product lifecycle move into the growth phase.

2. Importance of Product Lifecycle Phases

In this modern era, every product has its own lifecycle depending upon its nature and the complexity of the product. Like human beings, products also have a lifecycle that starts from birth and ends in death. The product lifecycle consists of four stages. Each stage between the birth and death of the product is important, as it leads to the introduction of new technological products in the market. These phases are: Planning Phase: This is the most important phase of the product lifecycle. In this phase, the future of the product is predicted and its behavior in the market is assessed. The marketing strategy of the product is defined in this phase. The following tasks are performed during the planning phase: Market Research: This is the most crucial activity throughout the entire lifecycle of the product. It determines the success of the product. It involves gathering details about the target market and identifying the areas where the product will sell. Competitor Analysis: This involves identifying the strengths and weaknesses of competitors, as well as potential opportunities and threats. Marketing Strategy: Based on the market research and competitor analysis, a clear marketing strategy is defined. This strategy helps in identifying the product's strengths, determining the pricing, deciding where to promote it, and planning its distribution.

2.1. Planning Phase

Planning is the foremost phase in the product lifecycle. It's the stage that differentiates strategic ideas from numerous others which are noble but never attain reality. It all starts with an idea. However, an idea which is not documented will remain just that, an idea. The initial step in the planning phase is to begin to formalize the concept of a product. This is done by preparing a high-level definition of the product and a project charter. The charter should describe the product at a high level and also set the boundaries for the project. For example, the charter should identify target customers for the product, identify the main benefits of the product and how it is positioned compared to competitors, set a rough budget and schedule for what is planned, etc. A project steering committee should be formed and responsible for continuously monitoring the project and ensuring that the project does not deviate from the charter and making decisions when it does. This can be a critical success factor. Products which are developed without a clear understanding of what the product is and isn't and lack customer or industry consensus often need to be reworked and revised endlessly. By setting clear goals from the beginning and sticking to them, a product is more likely to have a shorter and less painful development cycle.

2.2. Development Phase

The development phase sets the stage for the entire life cycle. It is during this phase that the actual product is formed. Now is the time to assess all of the positive and negative aspects of the item that is being released. This helps reduce future errors that can be very costly. During the development phase, there are several key decisions to be made. They all have to be made carefully as they are not easily undone. These decisions include the following: what is to be made, what materials will be used, and what technologies are required. All of these decisions can affect the cost of manufacture and the potential price for the product. At the same time, it is important to recognize the margin for error, as mistakes often lead to more spending in order to correct the problem. Many companies building products want to use the latest technology. This can be both profitable and harmful to the product. Using the latest technology suggests quality and efficiency. Consumers like the idea of a quality product that requires less time. Using automated machinery or a specialized tool design to reduce manufacturing time can significantly reduce product costs. However, using the latest technology can also be harmful. For untested technologies, the reliability is often less than that of the technology being replaced. Product testing may also require new methods, always a risk if the testing failure will damage the product. Ultimately, development decisions weigh present cost with future efficiency to maximize profit and product quality.

2.3. Launch Phase

As you move from development to production, the importance of matching design and materials carries on through the testing phase. The aims of the testing phase are to ensure that the item is safe, both structurally and functionally. In order to do this, a sample of items is used in a destructive test. This will indicate the durability and reliability of the product. If the product is successful in passing the destructive test, then there is a good chance it will move onto the next test. Non-destructive testing is a more accurate piece of testing, which allows engineers to gather an in-depth data collection of a particular product and use the data to form conclusions. Another part of non-destructive testing is reliability testing, which uses the item until functional breakdown in order to understand the life of the product. These tests make an important contribution towards an overall assessment of the quality and value of the product, as well as providing data for comparisons with competitors' products. This links in with the importance of the evaluation phase before the actual launch of the product. A business needs to have a clear understanding of the market conditions, the target customers, the product's current place and position, and the details of the competitive environment. If these are known accurately, then there is a higher probability of success. If carried out correctly, the evaluation should provide a set of valid, reliable, and comparable baseline measures of the price, the distribution, the sales, and the profits for the product over the course of a specified time frame. Ongoing research will compare the baseline measures with actual results using marketing intelligence systems and make adjustments based on the findings. The major point here is that you need to know what the customer wants and needs. Too often, a great idea is developed into a product that does not satisfy a true customer need, and the product will be a failure.

3. Conclusion

The article has a practical focus and delivers a great deal of information on product development and how it is managed through the use of the product life cycle. A thorough analysis of the product life cycle reveals to us that product development and management is not a simple and straightforward task. There are various factors that have to be considered: the purpose of the phase, the resources required, the potential pitfalls the phase may come across, the way a phase is conducted, to what extent a phase is monitored, and time and quality expectations. Looking at the various analysis models used throughout the article on both product lifecycle and development, you can see that various companies have different tactics for how they carry out their product lifecycle, and how there are a number of variable factors considered for taking an approach with a product lifecycle. This article is related to much of the content that is presented through lectures, in particular the models and analogies used to evaluate product lifecycle from one perspective and with the varying tactics seen in assessment of product development and its methods. This model is directly related to the development of the apple (into the future generations), which can be seen in lecture slides. Overall, the article is an essential consideration of product development and management.

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