Build a Great Strategic Plan for Your Function | Gartner (2023)

Strategic planning maps the initiatives and portfolio of investments required to achieve long-term strategic objectives.

Build a Great Strategic Plan for Your Function | Gartner (1)

Strategic Planning That Works for Functional Leaders

Implementing strategy often takes too long and costs more than expected. Turn enterprise strategy into functional initiatives with a succinct plan you can easily communicate to stakeholders.

Use this framework to:

  1. Translate enterprise ambitions into a strategic plan your function can actually use.
  2. Focus on specific key initiatives and actions for your function.
  3. Create a simple one-page view that’s both easy to follow and communicate.

4 Critical Things to Know About Strategic Planning

Especially in times of disruption, it’s key to understand what strategic planning is and does, what assumptions you need and how to leverage the value of adaptive strategy and scenario planning.

  • What is strat planning?
  • Strategic assumptions
  • Scenario planning
  • Adaptive strategy

Strategy and strategic plans: How they are different and why it matters

Strategy creates a common understanding of what an organization wants to achieve and what it needs to do to meet its goals. Strategic plans bridge the gap from overall direction to specific projects and day-to-day actions that ultimately execute the strategy. Job No. 1 is to know the difference between strategy and strategic plans — and why it matters.

  • Strategy defines the long-term direction of the enterprise. It articulates what the enterprise will do to compete and succeed in its chosen markets or, for the public sector, what the agency will do to achieve its mission.
  • Strategic planning defines how the enterprise will realize its strategic ambitions in the midterm. Too often, strategic plans are created and then forgotten until the next planning cycle begins. A well-done strategic plan turns an enterprise strategy into a clear roadmap of initiatives, actions and investments required to execute the strategy and meet business goals.
  • Functional strategic plans document the choices and actions needed for the function to move from the current state to the desired end state, and contribute effectively to the enterprise business model and goals.
  • Business unit strategic plans define and finalize business unit goals, objectives and initiatives, while cognizant of enterprise priorities and external trends.
  • Operational plans deal with the short-term execution of specific projects and changes, as well as any operational tasks not contained in the strategic plan.

Build a Great Strategic Plan for Your Function | Gartner (2)

If you’re responsible for functional strategy,such as IT, create strategic frameworks focused only on what’s material — critical assumptions, relevant metrics and the key initiatives your function needs to contribute effectively to organizational goals, even as those goals shift.

(Video) The steps of the strategic planning process in under 15 minutes

Look out for key trends and disruptions and test strategic assumptions

It’s critical to scan and respond to trends and disruptions that could impact your strategy and strategic plans — and change your strategic assumptions. Strategic planning cycles should incorporate some mechanism to vet assumptions for relevance (also see “Scenario Planning”).

Ignoring or devaluing trends and disruptions can leave critical gaps in both your strategic assumptions and your strategic planning process, because you may be overlooking both threats and opportunities for your value proposition and competitive positioning.

One Gartner survey found that only 38% of organizations have a formal process for this type of trendspotting. Gartner scopes the seven key areas of disruptive change as a “TPESTRE” of interconnected trend areas (see figure).

Executives across functions and teams can use the TPESTRE construct to identify key trends at any time — from augmented human experience to purpose-driven organizations and digitally enabled sustainability — and analyze their impact. From there, they can build strategic assumptions around the trends as they begin to map what actions might be needed in terms of business models, people/capabilities, IT systems and resources.

After sudden humanitarian or geopolitical disruptions like the COVID-19 pandemic or Russia’s invasion of Ukraine, a framework like TPESTRE can help you identify and monitora range of risksthat may affect your enterprise or function and you may need to include in scenario planning.

Build a Great Strategic Plan for Your Function | Gartner (3)

Scenario planning as a strategic planning tool for functions

Scenario planning enables executives and their teams to explore and evaluate plausible alternative futures to make strategic plans more robust and resilient. Pandemic-related disruption and volatility showed the importance of leveraging a range of scenarios to reset business strategy and strategic plans.

Commonly used by strategists at the organizational level, scenario planning at the functional level is just as valuable. Many functional leaders have little experience with strategic scenario planning, even though they may regularly work with their CFO to build budget and forecast scenarios. Those who can learn and apply scenario planning in strategic planning can help their organization navigate volatile and dynamic conditions more effectively, especially in areas like supply chain, where disruption remains high.

Exploring scenarios enables you to determine suitable action plans or strategies for different possible futures. It reveals how to react to a specific future and which set of actions would make sense no matter what conditions ultimately unfold.

For leaders of functional teams, developing scenarios and their underlying assumptions is in itself a useful exercise to corroborate or challenge strategies and keep them current.

The objective of scenario planning is to secure the best immediate outcome while preparing suitable alternative action plans, depending on how a situation unfolds. Proactively agreeing on both near-term operational decisions and long-term strategic plans will reduce the time it takes you to respond to emerging risks and opportunities. This can help your function preempt, rather than reactively control for, the negative effects of a major event or disruption.

Build a Great Strategic Plan for Your Function | Gartner (4)

Additional resources:

  • Guide to Scenario Planning for Functional Leaders
  • Scenario Planning for Supply Chain Leaders
  • Scenario Planning Ignition Guide for Marketing

Use adaptive strategic planning to enable a dynamic response

In an increasingly volatile and uncertain world, strategy can rapidly become out-of-date. To address this challenge, strategic planning must be adaptive. The faster the rate of change in operating conditions and the more disruptions you need to integrate into long-term strategy, the more adaptive your strategy models must be.

An adaptive strategy approach is what ensures your organization can spot new opportunities earlier and respond more quickly than your competitors, making you most likely to succeed in a dynamic digital world.

A truly adaptive strategy approach is consistent with four core practices (see figure) designed to move the enterprise from a rigid, top-down, calendar-based process to a more event-driven strategy approach. Functional strategy can incorporate the same principles. While a truly adaptive approach will be based on all four core practices, functional leaders can initially focus on the practices that address their immediate strategy challenges.

Rather than requiring perfect or complete information to execute, adaptive strategy uses available information to identify immediate actions required for an enterprise or function to be successful. These actions may range from focusing on high-priority areas to making foundational investments or conducting experiments to test ideas. You can use insights from these actions, along with any new information and analysis, to identify your next set of actions.

Adaptive strategy requires you to review strategy whenever new (and relevant) information becomes available, so it’s important to continually scan the business context to identify changes and review — and, where necessary, adjust — strategy in response to changes. (Also see “Strategic Assumptions.”)

(Video) Strategic Planning Process: How to Create a Strategic Plan

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What is strategic planning?

Strategic planning is the process through which enterprises, functions and business units identify the roadmap of initiatives and portfolio of investments that will be required in the medium-term to achieve long-term strategic objectives.

(Video) A Plan Is Not a Strategy

What are the four types of strategic planning and the three levels of strategic planning?

Strategic planning starts with setting strategy at the enterprise level, but that strategy must then be turned into action. The three levels of strategic planning typically refer to corporate vs. business unit and functional. The four types of plans are typically strategic, operational, tactical and contingency.

What steps are involved in the strategic planning process?

To build a successful strategic plan with a consistent and sequential process,functional leadersshould:

  1. Ensure consistent usage of terms to minimize confusion in strategic planning and set a baseline for collaboration.
  2. Build a strong foundation for more detailed planning by setting or pressure-testing mission, vision and goal statements first.
  3. Streamline stakeholder input by limiting mission, vision and goal setting to senior leadership, and leaving objective, action plan, measure and metric development to managers with execution expertise.

What are the key elements of strategic planning?

The key elements of a successful strategic plan include:

  • Mission and vision.The organization’s mission articulates its reasons for being, and the vision lays out where the organization hopes to be. The strategic plan, which links the two, must be adaptive enough to respond if the context changes during execution.
  • Strategic assumptions.To build a successful strategic plan, leadership should scope for trends and disruptions, and assess their potential impact on enterprise goals.
  • Strategic plan design.A rigorous strategic planning design effectively translates the strategy into plans that can and will be executed. Poor plans lead to poor execution.

What are the key terms in strategic planning?

  • Mission:Organization’s purpose
  • Vision:Desired future state
  • Goal:Aim
  • Objective:How to reach goals
  • Action plan:What’s needed to achieve objectives
  • Measures and metrics:To track progress toward goals

How do we design a strategic planning system?

Strategic planning “systems” refer to the tools used to document strategic plans. Gartner urges organizations not to focus on strategy in terms of the document they’re creating, but instead focus on turning strategy into an easily communicated action plan.

(Video) The Art of the One-Page Strategy | Gartner Webinars

What is a strategic action plan?

The strategic action plan is a formal document that serves as the primary source of information for how objectives will be executed, monitored, controlled and closed. Many organizations also deploy an associated but separate “action plan” for achieving the operating model.

What are strategic measures and metrics?

Measures are observable outcomes that allow organizations to evaluate the efficacy of their action plans. Metrics quantify those observed changes to enable an organization to concretely quantify its progress and stay aligned to its chosen measures.

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FAQs

What are the three important questions to answer in developing a strategic plan? ›

Here are the three questions to get your strategic plan on track.
  • Question 1: What is the real problem here? ...
  • Question 2: Why is our solution better than everyone else's? ...
  • Question 3: How are you going to do it?
Sep 18, 2015

What is strategic planning questions answers? ›

Strategic planning is a process in which an organization's leaders define their vision for the future and identify their organization's goals and objectives. The process includes establishing the sequence in which those goals should be realized so that the organization can reach its stated vision.

What are the steps to strategic quality planning your answer? ›

How to Strategic Plan in 7 Steps
  1. Step 1: Environmental Scan. ...
  2. Step 2: Internal Analysis. ...
  3. Step 3: Strategic Direction. ...
  4. Step 4: Develop Goals and Objectives. ...
  5. Step 5: Define Metrics, Set Timelines, and Track Progress. ...
  6. Step 6: Write and Publish a Strategic Plan. ...
  7. Step 7: Plan for Implementation and the Future.
Apr 26, 2022

What is an example of a strategic plan? ›

One of the most commonly available examples of strategic planning, a corporate strategy is designed to increase revenue and brand reputation. From new products and quality enhancements to aggressive marketing and sales techniques, there are many ways to tap into growth opportunities.

What are the six keys to successful strategic planning? ›

Strategic Planning Best Practices
  • Gather your team, set up meetings, and create a timeline. Before you say “thank you Captain Obvious” hear us out. ...
  • Operate Off Data, Not Assumptions. ...
  • Confirm Your Mission, Vision, and Values Statements. ...
  • Mission statement. ...
  • Vision Statement. ...
  • Values statement. ...
  • Strategy. ...
  • Prioritize Transparency.

What are the five 5 tasks in strategic planning? ›

There are five essential tasks of strategic management. They include developing a strategic vision and mission, setting objectives, crafting tactics to achieve those objectives, implementing and executing the tactics, and evaluating and measuring performance.

Which is the most important thing in strategic planning? ›

The key to identifying the most important elements of a strategic plan is to choose goals and objectives that expand your potential without straining your resources or creating too much risk.

What are examples of strategic questions? ›

Strategic Questions Examples:
  • Where do you want to go from here? What do you want to accomplish? ...
  • What obstacles will you have to overcome? What problems will you have to solve? ...
  • What additional knowledge, skills, or resources will you require to achieve your strategic objectives?
Jan 24, 2019

What is strategic plan in your own words? ›

A strategic plan defines who you are as a business and lists concrete actions to achieve your goals. When the unexpected occurs, a strategic plan helps your business survive and find new opportunities while staying true to your values and mission.

What are the 3 types of strategic plan? ›

What Are the Three Types of Strategy- And How You Can Apply Them!
  • Business strategy.
  • Operational strategy.
  • Transformational strategy.

What are the five 5 steps in making a strategic decision successful? ›

The strategic decision-making process requires you to work through five stages:
  1. Define the problem. It is crucially important to determine whether this is the real root of the problem, or simply a symptom of another issue. ...
  2. Gather information. ...
  3. Develop options. ...
  4. Evaluate options. ...
  5. Choose and take action.
Jun 16, 2021

What are the five steps in the strategic planning process explain with examples? ›

What is strategic planning?
  • Define your vision.
  • Assess where you are.
  • Determine your priorities and objectives.
  • Define responsibilities.
  • Measure and evaluate results.
Aug 19, 2022

What is an example of quality planning? ›

Quality Plan Example

A manufacturing business that processes metal parts is an example of a quality management strategy. Its quality plan includes applicable processes (detailing the manufacturing and duties), appropriate skill requirements, acceptable measurement margins, and material specifications.

What is a strategic plan summary? ›

Summary. A strategic plan helps you define and share the direction your company will take in the next three to five years. It includes your company's vision and mission statements, goals, and the actions you'll take to achieve those goals.

What is a successful strategic plan? ›

A successful strategic plan provides the information and guidance the management team needs to run the company with greater efficiency and help the business reach its full potential. Strategic planning helps managers make decisions based on logical assumptions and a clearer view of the future.

What makes a great strategy? ›

A good strategy provides a clear roadmap, consisting of a set of guiding principles or rules, that defines the actions people in the business should take (and not take) and the things they should prioritize (and not prioritize) to achieve desired goals.

What makes an effective strategy? ›

A strategy is effective if it uses the resources you allocate according to your plan and delivers the expected results. You have to continually evaluate use of resources and performance to check if your strategy is hitting your targets.

What are the four basic activities of strategic planning? ›

The following steps ensure that plans are used to guide the work of the organization: Communicating or "marketing" the plan, • managing the implementation of the plan, • supervising the actual work, and • monitoring and reporting progress on the plan.

What factors will make your plan successful? ›

In our work with clients, we've found five factors that contribute to successful plan development and implementation, while boosting credibility with business leaders.
  • Remember the purpose of planning. ...
  • Use facts and data. ...
  • Tie your plan to specific business objectives. ...
  • Set verifiable goals. ...
  • Build in accountability.
Sep 28, 2020

What are the three main questions that a good strategy should ask? ›

He taught that the three most important strategic questions each company must answer are:
  • What is our business? (Mission)
  • What will our business be? (The changing environment that we are certain about)
  • What should our business be? (Vision)
Apr 11, 2017

What are the powerful strategic questions? ›

Strategic questions to ask when building a company strategy
  • Who is your target customer? ...
  • What are the biggest challenges the company is facing? ...
  • How can you improve the company's current product? ...
  • How did the company get to where it is? ...
  • Where does the company want to go? ...
  • What should the company do more of?
Jun 1, 2021

What are the 4 strategic questions? ›

Four Strategic questions
  • What is your current share position in the market?
  • What is the core strength that your brand can win on?
  • How tightly connected is your consumer to your brand?
  • What is the current business situation that your brand faces?
Dec 6, 2014

What is strategic planning quizlet? ›

Strategic Planning. A long term process that helps an organization allocate its resources to capitalize on opportunities in the marketplace. The Strategic Planning Process. Includes conducting a situation analysis and developing the organization's mission statement, objectives, value proposition, and strategies.

What is strategy Short answer? ›

Strategy is the intelligent allocation of resources through a unique system of activities to achieve a goal. Simply put, strategy is how you plan to achieve a goal.

What is strategic planning and explain its purpose? ›

The purpose of strategic planning is to set overall goals for your business and to develop a plan to achieve them. It involves stepping back from your day-to-day operations and asking where your business is headed and what its priorities should be.

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