Strategic Planning Swot Analysis

The strategic planning process involves setting visions and missions, goals and objectives; it defines policies and procedures and examines strengths, weaknesses, opportunities and threats (SWOT). Lynch (2012) defines perspective strategic planning as a “formal planning system for the development and implementation of the strategies related to the mission and objectives of the organization”. Strategic planning consists of the careful analysis of the organisation’s external environment; the aim of strategic planning is to document the most important developments in which an organization must formulate its future strategies, goals and systems. Strategic planning also involves an assement of the organisations internal environment, strategic planning

The below factors are the causes which inhibit strategic formulation thus making the strategic formulation process ineffective.

i. Identical procedures

In some large companies with different strategic business units (SBU’s) management tend to make the crucial mistake of forcing SBU’s to follow an identical or uniform procedure. Effective strategic planning requires a flexible and an unstructured procedure because each SBU faces different problems, different opportunities and threats in the organisation’s external and internal environment. Latif et al (International Journal of Management & Organizational Studies) ii. People

Large organisations must be able to understand the culture of its people, this is very important when executing strategy formulation. Failing this understanding becomes a hurdle in effective strategic planning.

iii. Power and

Any strategy that could result in any change in an organization might be met with hostility from top managers in the fear of losing or having their power and influence disrupted thus this creates hurdles in the implementation of strategic plans.

• Barriers to strategy implementation

Kaplan and Norton (2001) identify the below as the four common barriers to strategy implementation;

i. Vision Barrier

Kaplan and Norton (2001) state that only 5% of company employees understand their organization’s strategy.

ii. Resource Barrier

Only 60% of organisations do not link their budgets to strategy, B. Paladino (2007) states that most companies might be pursuing financial strategies that are different from their operational strategies and customer strategies.

iii. Management Barrier

This barrier indicates that only 85% of executive team members spend too less of their time ( less than 1 hour per month) discussing strategy and strategic issues.

iv. People Barrier

The people barrier exhibits that only 25% of management link personal objectives and incentives to strategy. Most companies only reward management for initiatives not linked to company strategic