BUSINESS PLANNING

For most of the 1980s and '90s, the distinct but interdependent disciplines of strategic and business planning have been out of favour, with Peters' 'bias for action' holding sway in many 'excellent' organizations. The prevailing wisdom was that empirical evidence linking planning and improved financial performance was slight, particularly among small firms, and that the associated processes were bureaucratic and inefficient. Peters' work on innovation quotes Ross Pero "Fire. Ready. Aim."

Recently though, strategic planning has made due to intensifying competition, accelerating environmental change and the emergence of value management. All point towards a need for clear strategic goals directing business effort efficiently and effectively. The watchword has become 'Aim, Aim, Aim, Ready ...FIRE!'. 

For any organization dependent upon financial backing, business planning has never really gone away. The new wave of planning has introduced some important principles which can be applied equally to strategic and business planning: 

1. There are infinite varieties of strategic or business plan: purpose and context are two key determinants of the best approach and format for individual organizations
   
   

2. Neither strategic nor business planning are necessarily financial processes: equally valid foci can be provided by marketing, business integration, internal review, and so
   on. 
   
   

3. Both processes should be democratic exercises involving not only staff at all levels of an organization, but a full representation from across the organization's entire 'ecosystem' .
   
   

4. Action is still important: strategic or business planning processes must produce widely visible results after a short period of time (some say eight weeks). 
   
   

5. For managers these trends mean not only a greater involvement in strategic and business planning, but an expected ability to consult, inform and involve others. This in turn requires the existence of a robust framework, providing clear outlines for planning contributions, while allowing scope for varied, creative approaches. Managers will also need to be adept at
   
   

   1. extrapolating team or business unit objectives from strategic plans, and,
      
      

   2. integrating planning activity across different functions so that, for instance, resource planning will need to take in training and development needs, and marketing goals will influence staffing plans. 
      
      

As a measure of the success of strategic and business planning processes, the extent to which objectives have been met is only partially useful. It's important too to look at whether and where performance has improved, and at the levels of satisfaction with the processes themselves. 

• Are staff clear about the organization's mission?
  
  

• Do suppliers or clients feel consultation is genuine?
  
  

• Do managers feel the final set of objectives strikes an appropriate balance?
  
  

• Do shareholders feel that they understand where the organization is going?
  
  

Positive answers to these questions would indicate that a successful process is operating, and it would be peculiar if organizational performance did not reflect this optimism. 

POINTS TO PONDER

1. How involved are you in the business planning process for your organization?

2. What are the indicators for measuring the success of this process?
   
   

In order to help you,  we have published a dossier on this subject called  "Business Planning"  this dossier along with our well stocked on-line reading room will help you to develop your knowledge in this area as part of our multi-format management development infrastructure.