Every successful organization, before getting down to its business, should answer a few essential questions:
- In what direction I want my organization to grow in the future?
- Who will be my customers, and what value is my organization going to bring them?
- What measures will my organization take to get this value to potential clients?
These questions are the organization’s vision – visualization of its desired state and mission – a short, precise manifesto of the organization’s most important objectives and the value it brings for its environment. And the process of determining the vision and mission of an organization is called strategic planning.
What exactly is strategic planning?
Strategic planning is developing long-term tactics that aim to define and achieve an organization’s goals. It addresses fundamental issues, such as the organization’s core activity, and provides a framework for further tactical and operational planning.
The strategic planning process consists of 3 main stages. The first one is a strategic analysis. This is a process based on diagnostic activities that aim to identify the current and future strengths of an organization and its development potential and its threats and areas that can still be improved. Porter’s five forces analysis, SWOT analysis, and PEST (PESTEL) analysis are the most common tools used for this process. This stage should be thoroughly carried out because a well-prepared analysis, giving an accurate picture of the situation, can be a basis for creating a successful plan.
The second step is strategic planning. It is a moment for considering various options an organization may adopt and the methods of implementing them. The planning stage should culminate in developing a strategic plan, usually including several different scenarios of the future with varying optimism levels, and in deciding to adopt and implement a particular strategy.
The last (but not least) step is strategic implementation. This stage follows the selection of a specific plan and includes several activities related to its performance. These activities, however, are related to operational planning, which deals with more complicated issues than strategic planning.
Due to its importance, strategic planning is a top-level activity because the top management must actively participate in it. However, even if the final strategic decisions are the board and top managers’ responsibility, the planning process itself can be carried out by an external company. Why then is it worth hiring a consulting agency for strategic planning?
Why should we hire a consultant for strategic planning?
One of the main reasons is time-saving. Strategic planning is a time-consuming process, especially when carrying out comprehensive, in-depth research at the strategic analysis stage. If this were to be handled by the company’s employees or managers, it would distract them from their proper work for a long time. However, in a situation where carrying out the analysis is outsourced to an external consulting company, the managers’ only responsibility is to maintain contact with the consultants, supervise the progress of their work, and make the final decisions based on the provided conclusions.
Why hire a consultant for strategic planning? Another reason is access to expert knowledge. At first glance, strategic planning appears to be a simple task. Still, when it comes down to it, it turns out that conducting a comprehensive, valuable analysis requires a great deal of knowledge and experience. Behind an excellent consulting company, there are dozens, if not hundreds, of similar projects completed. Consultants have extensive knowledge of strategic analysis tools, have access to the best sources of data, reports, and studies, as well as to a vast network of experts in their chosen fields. All this means that a comprehensive, reliable analysis carried out by an experienced team of consultants provides very accurate conclusions and invaluable market insights that would be very difficult or even impossible to obtain in any other way.
Finally, as the name suggests, an external consulting company can look at the organization and its activity from the outside. The management’s perspective can be biased or too narrow, especially when it comes to seeing threats or weaknesses in an organization. External consultants see their clients in a broader market context, enabling them to spot opportunities that have not yet been exploited or lurking threats that those working within the organization might never have noticed.
What does a strategic planning consultant do? Hiring an experienced, proven consultancy is usually quite expensive. However, it is essential to see this expense from an opportunity cost perspective. Ordering a strategic analysis to a team of company employees would take them away from their proper duties for a long time, thus depriving the company of the value generated by their work. Besides, an analysis carried out inaccurately or by inexperienced people could result in the organization making the wrong strategic decisions, which could cause significant losses.
Therefore, hiring a consulting firm to conduct a strategic analysis should be treated as an investment in the organization’s development.
Find out also more about strategic planning.