​Is your strategic planning focus and planning time horizon appropriate to your needs ?

Strategic Business Planning is a process undertaken by most enterprises on an annual basis. 

Most of us probably develop business strategy and implementation plans with a particular emphasis on the immediate 12 months

However there different areas of focus and timeframes, where a different strategy development approach may be appropriate.

The planning focus can be:

• Largely concentrating on the enterprise and typically having a focus on the immediate situation and next 12 months.
• Medium term one to three years, focusing on the current and related market sector/segment growth, and centred on elements like competitive advantage, market coverage, development of expertise and reorganizing resources.
• Enterprises involved in fiercely competitive markets may have to address long-term survival while others may wish to pursue exponential growth by creating/capturing new potential high growth opportunities. In such circumstances a major strategic shift may be based on a three year plus enterprise strategic planning horizon.

Tools available to address the longer-term horizon of three years plus include a Blue Ocean strategy and Porter’s Five Competitive Forces framework.

A Blue Ocean Strategy is a marketing strategy in which a business makes a paradigm shift away from existing highly competitive saturated markets to creating and capturing new demand in a largely uncontested market where competition becomes irrelevant.

Porter’s model of competitive forces assumes that there are five generic competitive forces that influence the competitive power of the key players in the relevant business environment.

By analyzing how each force affects the enterprise, and by identifying the strength and direction of each force, one can quickly assess the strength of your position and your ability to make a long-term sustained profit in a particular market or industry under consideration.

The SPACE Matrix and Grand Strategy Matrix tools address the macro environment and provide a transition from the long term and offer a pathway to the more familiar one-to-three-year strategic business plan.

The term SPACE matrix is derived from Strategic Position & ACtionEvaluation matrix and it focuses on strategy formulation as related to the competitive position of an organization. Should the overall strategy theme be aggressive or conservative? Other options include strategies focused on being defensive or competitive.

The Grand Strategy Matrix is a useful framework to suggest alternative medium to long-term strategies. It allows the user review strategic options within a market framework where markets are defined in terms of market growth rates and the enterprise’s competitive position.

There is a portfolio of familiar tools for the one-to-three-year planning process. The portfolio includes, PEST, PESTLE, SWOT, TOWS, BCG Matrix, GE-McKinsey Matrix, Ansoff Model, Perceptual/Market Mapping, and Competitive Analysis.

The Business Tools Store strategic planning portfolio includes templates for most of the tools.

Subsequent blog posts will address each of the sets of tools for the different planning horizons.