Vistage Research Center

Get actionable, data-driven insights and expert perspectives from our global community of CEOs and thought leaders. Led by Joe Galvin, Chief Research Officer

What Every Business Executive Should Know About Creating a Comprehensive and Executable Strategic Plan – Part 2


Given the opportunity to better leverage the art and science of strategic planning, organizational leadership should endeavor to understand strategic planning and unlock the competitive advantages it can bring them.

Strategic Planning Defined

Strategic planning is the process of devising a plan of both offensive and defensive actions intended to maintain and build competitive advantage over the competition through strategic and organizational innovation.

A well-formed corporate strategy lays out the bumper-pads to keep organizational momentum aimed in the properStrategic-Planning-Defineddirection, accomplished through unambiguously expressed strategic goals (outcomes) and operational actions to achieve those strategic organizational outcomes.

At a minimum, for strategic planning to yield competitive advantage, it must address three key questions:

  • “What do we do?”
  • “Who are our customers?”
  • “How do we do what we do better than our competitors?”

What do we do?

While it may sound almost silly to suggest that organizations should expend effort during strategic planning defining what it is that they do, but it is not as unproductive as it may seem.  If an organization cannot succinctly explain what they do, how will their marketplace understand it?  Furthermore, this line of analysis during the planning process often uncovers misperceptions on the part of leadership’s understanding of core lines of business and market focus.  Strategic planning begins with getting leadership on the same page about the mission of the organization and the core offerings the business provides.   Additionally, in strategy development, the question of “what should we do” is a corollary to the “what we do” question.  This perspective relates to building competitiveness in your offering and exploring tangential markets that might be exploited, provided that the barriers to entry are not too high and organizational capabilities match the opportunities being evaluated.  Truly gauging core competencies is key to this analysis, not just from leadership, but down through the organization.

Who are our customers?

An organization’s strategy cannot overlook the most important stakeholder – the customers served by the company.  Data analysis of the organization’s customer base is recommended prior to, or as a part of the strategic planning process in order to firm up suspicions and debunk any incorrect perceptions.  Knowing the attribution of the organization’s customer profiles helps drive value-creation, sales growth, product and service innovation and ultimately profits.  A thorough understanding of the major customer groupings, segmented by loyalty, profitability and annual spend will help answer questions like:

  • Why are our customers still buying from us?
  • How stable is that long-term buying relationship?

How do we do what we do better than our competitors?

For an organization to understand its own competitive advantage, it must first examine its core “essence of goodness” and understand the triggers that compel customers to buy products or services from them instead of a competitor.  Is it service, product superiority, pricing or something else?

Competition always exists externally from third parties, but it can also come from within current customers.  Internal competition occurs when a customer develops a solution that displaces the product or service of the selling organization.  Strategy must remain close to the creation of tangible customer value or risk losing market competitiveness.

When we can define and explain our value proposition succinctly, strategic goals related to innovation and value creation can more easily be developed and ultimately implemented.

A Graphical Depiction of the Elements of Strategic Planning

The graphic below shows inputs into a well-formed strategic planning process, in the context of the environmental and structural current state of the organization.

Method-Frameworks-Strategic-Plan-Overview

In the articles over the coming weeks, we will walk through various aspects of the graphical model and clarify terminology.

———–

To View Part 1 of this Series, Click Here

To View Part 3 of this Series, Click Here

To View Part 4 of this Series, Click Here

To View Part 5 of this Series, Click Here

To View Part 6 of this Series, Click Here

 

Print Friendly, PDF & Email

Leave a Reply

Your email address will not be published. Required fields are marked *

Predefined Skins

Primary Color

Background Color

Example Patterns

demo demo demo demo demo demo demo demo demo demo

Privacy Policy Settings

  • Required Cookies
  • Performance Cookies
  • Functional Cookies
  • Advertising Cookies
These cookies are essential in order to enable you to move around the Sites and use its features, such as accessing secure areas of the Sites and using Vistage’s Services. Since these cookies are essential to operate Vistage’s Sites and Services, there is no option to opt out of these cookies.
These cookies collect information about how visitors our Sites, for instance which pages visitors go to most often. These cookies don’t collect information that identifies a visitor. All information these cookies collect is aggregated and therefore anonymous. If you do not allow these cookies we will not know when you have visited our site, and will not be able to monitor its performance.

Cookies used

Visual Web Optimizer
These cookies remember information you have entered or choices you make (e.g. as your username, language, or your region), and provide enhanced, more personal features. They may also be used to provide services you have asked for such as watching a video or commenting on a blog. They may be set by us or by third party providers whose services we have added to our pages. If you do not allow these cookies then some or all of these services may not function properly.

Cookies used

Google Analytics
GTM
Gravity Forms
These cookies are used to make advertising more relevant to you and your interests. The cookies are usually placed by third party advertising networks. They remember the websites you visit and that information is shared with other parties such as advertisers. If you do not allow these cookies, you will experience less targeted advertising.