Strategic Planning in Management: A Critical Analysis

This essay delves into the significance of strategic planning in modern business management, arguing against the notion that it is a waste of time. It defines strategic planning as the process of setting organizational objectives and charting the course to achieve them, emphasizing its importance for providing purpose and direction to a company and its employees. The essay acknowledges debates about the relevance of strategic planning in a rapidly changing business environment, particularly with advancements in technology and unpredictable futures. However, it counters these arguments by highlighting that strategic planning enables firms to adapt to change, make informed resource allocation decisions, and maintain stakeholder relationships. The essay emphasizes that strategic planning fosters organizational alignment, transparency, and effective communication, which are critical for responding to market shifts and competitor actions. By providing a roadmap for performance and enabling proactive rather than reactive strategies, strategic planning is presented as essential for long-term business survival, especially in an era of complex customer demands and evolving market conditions. The essay concludes by reinforcing the necessity of strategic planning for goal formulation and adaptation to change, while highlighting that a lack of strategic planning can lead to organizational chaos and failure.

Management Principles
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Contents
Introduction......................................................................................................................................3
Strategic Planning is not a Waste of time........................................................................................3
Conclusion.......................................................................................................................................7
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Introduction
Strategic planning is the planning of the objectives for a firm and the direction the firm takes to
attain these objectives (Alkhafaji, 2013). Strategic planning involves creation, implementation
and evaluation of the various strategies that a firm makes in order to achieve its goals and
objective. Strategic planning has been an important management tool since a very long time.
However, there has been a constant debate about the relevance and effectiveness of strategic
planning in view of constant changes and uncertain future (Bryson, et al., 2009). In the wake of
changing dynamics of modern business and changing technology, this debate has become fierce.
However, majority of thinkers believe that uncertain future and change is the main reason why
strategic planning is necessary (Alkhafaji, 2013). The following essay argues in favour of
strategic planning and tries to give persuasive reasoning why strategic planning is not a waste of
time considering the pace of change.
Strategic Planning- not a waste of time
Strategic planning is considered to be the central line for management and governance of a
company (Bryson, et al., 2009). It is argued that, strategic planning provides a purpose to an
organisation and its employees. Moreover, those in favour of strategic planning point out that,
without planning there will be chaos and confusion which will spell doom for an organisation
(Berry, 2007). However, certain researchers and academicians feel that there is no clear evidence
about relevance or irrelevance of strategic planning Furthermore, it is debated that, due to the
unpredictability of future and rapid and dynamic business changes, strategic planning is a waste
of time. However, some academicians also point out that firms which plan for the future based
on the expected future outcomes have more chances of being successful
Due to a revolution in information and communication technology, business scenarios have
undergone a rapid change (Alkhafaji, 2013). Production and marketing methods have changed
and are continuously changing. On the surface level due to changing methods and practices of
business, planning seems a futile activity. A sudden invention or innovation may change the
whole shape of business functioning, leading to irrelevance of whatever planning that has been
done (Spee & Jarzabkowski, 2011). Hence, it is believed that senior management should utilize
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ideas to manage customer wants on a frequent basis rather than going for long term plans (Berry,
2007). Therefore, the centre point of the argument against strategic planning is that planning
does not help in finding solution to the events evoked by rapidly changing business environment.
However, contrary to the above arguments there is still evidence that despite the mammoth
changes hitting the business world on frequent basis, strategic planning is still an important
process in business management (Alkhafaji, 2013). Strategic planning, it is argued, gives a basis
to the organisational vision.
Strategic planning is relevant even in the time of change (Berry, 2007). Only through planning,
reflection and analysis a firm can decide to invest its resources. Without strategic planning a firm
will not be able to respond to change as it wouldn’t know how to respond or what action to take
(Berry, 2007). Planning gives guidance to the management and workers which helps them in
taking adequate action; given a sudden situation.
It is argued that, change renders strategic planning useless (Alkhafaji, 2013). However, on closer
inspection it can be said that, strategic planning builds the alignment of the organisation
effectively. Through planning the firm can understand the change and react to them by making
necessary amendments in the overall plan. Strategic planning also assists in communicating
action plans on a daily or monthly basis to the workforce (Dwyer, 2013). Due to the process of
strategic planning the entire workforce of an organisation becomes aware of their purpose and
the reason of actions taken by the management.
Plans are not made by firm to be followed rigidly (Spee & Jarzabkowski, 2011). They can be
altered as and when required. In face of a change the firm can realign itself and its objectives and
change its plans to suit the changed process. However, not making any plan at all will render the
firm goal less. The employees won’t know what action to take and even during a drastic change
they will not be in a position to manage the organisation (Alkhafaji, 2013). In absence of
strategic planning, there will be chaos and ultimately the organisation will fail. Therefore, even
during a business situation change the firm needs proper strategic planning of the future course
of action.
Strategic planning brings about transparency (Berry, 2007). Due to strategic planning all
departments know what others are doing and act in a synchronised manner. In absence of
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strategic planning there will not be coherence between various departments and they will not be
able to take a planned and cohesive action to achieve the organisational goal.
Strategic planning also helps in forming proper workable relationship with stakeholders
(Alkhafaji, 2013). Even if change occurs, stakeholders will try to stick with the organisation if
relationship has been built through effective planning. Additionally, stakeholders will also feel
more secure if the organisation has structured plans of goal achievement which involves them as
per their areas and expresses. For example, a plan of a future contract with a supplier will make
him feel secure about his future business. Even if a change occurs the organisation can have a
clause in the contract to make allowance for a certain change. However, a lack of plan can breed
insecurity in stakeholders regarding their own future with the organisation (Alkhafaji, 2013).
Therefore, strategic planning is also important for stakeholder relationship.
The most relevant argument which is given against the strategic planning process is that future is
uncertain and sudden changes may affect the organisation and render the plan ineffective.
However, the organisation is not faced with drastic changes all the time (Alkhafaji, 2013). Most
of the time small business changes affect the firm. Planning helps in adapting to change.
Furthermore, a good strategic plan has a window to adapt to change and make necessary
amendments to contend with it (Alkhafaji, 2013). However, without strategic planning the basic
functioning of the organisation will be hampered. The organisation would not have a purpose
(Berry, 2007). It would not have a road map for performance and even if a positive change
occurs, the firm will not be able to respond to it.
To cite and example in support of the argument, suppose a sudden shift in demand pattern occurs
which affects a firm’s sales revenue and impacts the objective of sales volume achievement
which it has set for itself. In absence of a proper plan, the management wouldn’t know how to
handle this situation. Without prior strategic planning there would not be any proper resource
allocation to make any adjustment. There wouldn’t be any objectives which could be altered to
react to the situation (Alkhafaji, 2013). However, if the firm has planned its finances, marketing
and human resource policies effectively, it can make small amendments in the plan and realign
resources to change certain product features to meet the change in demand.
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Similarly, if a competitor changes price or comes out with a product innovation which affects the
demand of the product of the firm, the firm can make changes in its plans, adapt to the
requirements and respond to the competitor’s action (Alkhafaji, 2013). However, if there is no
plan and the firm is running on day to day basis by responding to daily needs in an unplanned
manner, the workforce will not get proper instructions regarding wheat actions to be taken in
view of the competitor’s policy change (Alkhafaji, 2013). Therefore, to manage change a firm
needs adequate strategic planning so that it can communicate regarding realignment of resources
to the stakeholders and employees.
Those against strategic planning use the unpredictability of future as a bottom-line of their
argument and say that, as changes cannot be predicted; strategic planning is a waste of time
(Alkhafaji, 2013). However, this argument speaks of a laid back attitude and belief in fate. This
argument holds for letting the future happen and not making it happen (Bryson, et al., 2009). It is
a matter of fact that without planning, action cannot be taken. In other words any action taken
without planning can be suicidal for the organisation (Bryson, et al., 2009). An unplanned
respace to change can lead to undesired outcome. For example, if the firm reacts to a demand
shift without planning the next action, the firm may face rejection from the customers.
Future is uncertain and ridden with unpredictable changes (Alkhafaji, 2013). However, strategic
planning based on scientific forecasts and projections can help safeguard the organisation in the
face of imminent changes. Strategic planning is about being proactive while lack of strategic
planning is being reactive. Future cannot be foreseen but forecasts can be made regarding
changing market conditions based on the present trends. Extreme drastic changes are rare. Most
changes can be predicted to a great degree of accuracy by reflection and application of
management principles (Alkhafaji, 2013). However, in case of a drastic change no plan will
work but one should not stop planning because a drastic change may befall the organisation.
Basic aim of strategic planning is to give a purpose and a direction to the organisation (Alkhafaji,
2013). For example, a certain sales outcome can be an objective. Even if changes occur the firm
will still be able to achieve near figure of the projected figure of the sales outcome that it had
planned. However, in absence of strategic planning there will be no direction. The employees
will be working on daily instructions and there will be no serious thoughts given to any goals
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(Alkhafaji, 2013). In this scenario even if a change occurs the firm may buckle down and may
not be able to respond accurately.
In the view of changing business scenarios those companies which do not have strong foundation
made by the tools of strategic planning will not be able to survive for long in the field (Alkhafaji,
2013). Customer choices have become complex and demanding. Therefore, a proper
understanding of consumer behaviour is required (Alkhafaji, 2013). This understanding can only
be brought about through strategic planning. A good plan which focuses on solid goals and
creates proper policies can help in understanding the customer needs.
Companies can only survive if they focus on goal achievement and make adaptable plans to
achieve the goals. Focus of the organisation on the goal can be created through proper strategic
planning as strategic planning gives a purpose to the organisation. Purposeless organisation will
not be able to focus and hence will not be able to react to changes (Alkhafaji, 2013). Therefore,
such a firm will not be able to survive in the changing times of business.
Proper strategic planning will help in understanding market conditions, customer segments,
product preferences and other important aspects of business. Strategic planning also helps to
understand the competitor. Lack of strategic planning will cause an organisation to function in
isolation due to which it will not be able to understand the changes when they occur (Alkhafaji,
2013). Strategic planning gives a proper direction to the business and helps in creating goals for
achievement in near or long term future. It also helps in giving vision and purpose to a business
even in the time of change (Berry, 2007). Consequently, such firms will not be able to respond to
change. Therefore, strategic planning is very important and essential for business in changing
market conditions.
Conclusion
Strategic planning is considered to be useless by some thinker. However, strategic planning is
important to formulate goals and objectives. Changes can also be forecast based on scientific
measures of trend projection and plans can be altered based on changes. However, an
organisation without strategic planning will be purposeless and will not be able to respond to the
changing demands of business. Therefore, strategic planning is not a waste of time but need of a
business to sustain itself in the ever-changing business world.
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References
Alkhafaji, A., (2013) Strategic Management: Formulation, Implementation, and Control in a
Dynamic Environment. New York: Routledge.
Berry, F., (2007) Strategic Planning as a Tool for Managing Organizational Chan. International
Journal of Public Administration, 30(3), pp. 331-346.
Bryson, J., Crosby, B. & Bryson, J., (2009) Understanding strategic planning and the formulation
and implementation of strategic plans as a way of knowing: The contributions of actor-network
theory. International public management journal, 12(2), pp. 172-2007.
Dwyer, J., (2013) Communication for Business and the Professions, Strategies and Skills,. 5th
ed. Melbourne: Pearson Education Austrilia.
Spee, A. & Jarzabkowski, P., (2011) Strategic planning as communicative process. Organization
Studies, 32(9), pp. 1217-1245.
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