The Benefits of Strategic Planning: Why is an Effective and Well Planned Strategy Crucial?

Having a strategic plan in place is essential for any organization to reach its goals and succeed. It provides the necessary foundation for decision-making, tracking progress, and creating a sense of direction. A strategic plan is only as good as its ability to be executed and sustained, which is why it's important to have a specialized team in place to communicate, coordinate, and evaluate progress. A strategic plan helps to establish roles and limits for everyone involved, thus improving efficient decision-making and creating a greater sense of overall momentum and direction.

It also allows you to track progress towards objectives. When each department and team understands the company's broader strategy, their progress can directly impact their success, creating a top-down approach to monitoring key performance indicators (KPIs). Having a strategic plan in place also helps maintain harmony with members and departments, as well as to maintain a positive and healthy work environment. By planning your company's strategy and defining its objectives, KPIs can be determined at the organizational level.

For example, if a company is not reaching its target customers, having a strategic plan to meet the objectives could help. In the online course Disruptive Strategy, Harvard Business School professor Clayton Christensen points out that in a study of HBS graduates who created companies, 93% of those with successful strategies evolved and moved away from their original strategic plans. This is where stakeholders use the existing strategic plan, which includes the statement of objectives and long-term strategic objectives, to carry out evaluations of the company and its environment. Realizing the importance of strategic planning helps the organization to be more proactive rather than reacting to future issues and problems when it comes to achieving goals and objectives.

It is very important that the company's management and employees understand the significance of strategic planning, as well as that they follow the actions proposed in that planning. The strategic plan is periodically reviewed and revised to adjust priorities and reevaluate objectives as business conditions change and new opportunities arise. A specialized strategic management team works with leaders and senior managers across the organization to communicate, coordinate, and evaluate progress in relation to objectives.