Strategic Thinking and Business Planning

Businesses are formed with specific, well established goals in mind. Business planning is an organized way for a firm to achieve short-term and long-term goals--determined through strategic thinking. Strategic thinking is the how to of getting things accomplished to realize goals. Strategy allows managers and other key personnel to plan business activities effectively, which translates into the realization of long-term goals.

Basics of Strategy

According to William J. Rothwell, Patrick E. Gerity and Elaine A. Gaertner in their book Linking Training to Performance, strategy is defined as a planned, systematic course of action that aligns an organization with its environment in such a way that can positively impact its future.

Strategic Thinking

Strategic thinking involves fact and data collection, synthesis, creativity, intuition and seeing relationships and patterns in objects, structures and people in an organization's internal and external environment. It focuses on the long-term rather than the short-term. Strategic thinking involves utilizing resources at hand and deriving maximum potential from them. It is both a creative and an analytical process, allowing an organization to capture, assimilate and analyze data and input that information into creating or reinventing an organization's vision/goals.

Business Planning

A business plan, according to Peter McCann in his book Strategy and Business Planning of Privately Held Companies, sets out marketing, administrative and operations tasks. Business plan activities are short-term and specify a firm's activities for its first three or five years of operations. Business planning includes functional plans (finance and administration, people management, human resources and purchasing) for various departments of an organization.

Strategic Thinking and Business Planning : The Link

Strategic thinking determines the business plan. Strategic thinking takes a broader view of the business, its roles and expectations, environmental impact and long-term vision. A business plan is narrower in scope and defines day-to-day operations that allow the organization to function. Strategic thinking is long-term and involves the president while business planning is short-term and involves the president along with senior management.

Strategic Business Planning

Strategic business planning involves key personnel who decide among themselves what the organization aims to achieve and how it proposes to do so. According to the book Linking Training to Performance, successful strategic business planning must aim to address and clarify five points: the organization's mission, its vision, key environmental issues, organizational strategy, and the various monitoring and evaluating tools and techniques proposed to ensure that the organization's progress is monitored.
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Why Is Strategic Thinking Critical to Your Future Success in the Workplace?

Companies use strategic planning to manage the growth and development of the organization. Managers and employees in an organization using strategic planning must use strategic thinking to develop plans that anticipate obstacles. In other organizations or positions in a company, employees using strategic thinking can perform at the highest level and outshine other workers to move ahead.

Ability to Identify Trends

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An employee who uses strategic thinking has an ability to see trends in the industry and make workplace decisions that benefit the company. Forward-thinking employees help organizations position themselves in the marketplace for growth and development. Strategic thinkers are aware of the subtle cues in business that signal a change in the environment. These workers are a valuable asset for the organization, which can translate to advancement opportunities.

Vision
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Strategic thinking requires vision and innovation. Managers or employees who use strategic thinking strategies have the ability to visualize the ideal situation for the workplace and the methods that will bring the vision to reality. Management employees who have vision and a clear picture of how the company should operate can lead others to create that reality. Workers who are strategic thinkers have the tools to become the leaders in an organization.

Strategic Planning
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Strategic thinking allows employees to develop strategic plans for developing an idea or improving a process. Organizations require managers who have the skills to put together a plan that will benefit the company. Creating a plan to complete an improvement project or to implement a new policy is an important skill for managers and those in leadership roles. Leaders must set the direction for others to follow when implementing a strategic plan. To succeed and advance in the workplace, employees must have the skills to develop a plan for improvement.

Measurement
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A strategic style of thinking always measures the results of a planned improvement or project. Changing trends and situations can cause a plan to require refinement and change. The skills to monitor improvements and projects for continued success allows the employee to remain ahead of the curve and prepare for changes. Strategic thinkers always measure their plans to ensure they are on the appropriate course of action. Self-review is an important ability in the workplace.

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Critical Skills Needed to Be a Strategic Thinker

By Nicola Jones, eHow Contributor

Strategic thinking is the practice of developing and analyzing every decision made after taking into consideration the present and future conditions, the desired outcome and the expected results. Strategic thinking involves solving problems and challenges that arise by assessing these in a broader context. Critical skills are required in formulating an idea of what you aim at achieving in the future, and working towards it.

1. Developing a Vision
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Strategic thinkers have the ability of creating a precise vision, by stating the goals and objectives that will be achieved within a given time line. They also formulate an action plan for every goal by breaking it down into smaller tasks, with each of the tasks having a list of the required resources, people and the specific time frame for completion.

Flexibility
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Strategic thinkers design flexible tactics by constantly reviewing the progress made and changing plans in coping with the current circumstances. They benchmark their thinking and utilize any emerging opportunity that will help in achieving the set goals. They are proactive, anticipate changes, and are prepared in dealing with challenges that may arise. Instead of being overwhelmed by changes, strategic thinkers adjust their thinking and formulate other contingency plans.

Perceptive
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Strategic thinkers are subtle and recognize clues that will help in navigating the future direction and realizing opportunities. They listen when other people are talking and make observations which will provide guidance in decision making. They eagerly learn things from life experiences and use the insight in thinking out strategic issues.

Time Out
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Strategic thinkers set aside time to reflect, meditate, recollect and formulate ideas. They take a walk alone or stay in a quiet room, during which they might come up with new ideas or assess how many past goals have been achieved.

Discipline
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Strategic thinkers are patient and refrain from making hasty judgments, decisions or conclusions. They are aware that time is required in achieving success for the defined vision. Strategic thinkers do not abandon their plans half-way because of challenges, but soldier on until the end. They do not judge the thoughts of other people harshly, but instead use these to come up with ideas.

Mentor
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Strategic thinking involves seeking advice from other people and sharing ideas with groups or a mentor. It also entails seeking help from an expert when needed and offering people ideas feedback and insight.

Top 10 Strategic Thinking skills

by Martin Haworth on 28th March 2011

To be up there with the best strategic thinkers, you need to use the left and right sides of your brain, a skill which takes practice as well as confidence. Having the logic and creative sides to your skillset are of immense value. To be up there with the best strategic thinkers, you need to use the left and right sides of your brain, a skill which takes practice as well as confidence. Having the logic and creative sides to your skillset are of immense value. Here are some skills that the very best strategic thinkers have, and use, every day. They Have a Vision They are great at both thinking with a strategic purpose as well as creating a Visioning process. They have both tools in their kit and they use both to complement each other. This form of supportive thinking and seeing the future, creates a way of thinking and evolving strategy that is focused and yet broad. Make Time In a busy businesses and organisations, be they small or large, making the time is vital. At the top of their game key strategic thinkers take time out. Maybe a retreat (maximum points!); maybe a day in a hotel foyer; maybe an afternoon somewhere/anywhere, with a blank sheet and a thinking hat on. Whatever works for them but they do it. Are Not Hasty The clue is in the description, Strategic Thinking is not about today, tomorrow or next week. In close partnership with holding a clear vision for the business future, these two create the tomorrows of the future. But not tomorrow! This is shaping, coaxing, tuning for a quality business performance in the years to come. Great exponents take time to fine tune, revise and engineer quality futures! Absorb and Notice They are truly aware. In any business, there are clues, often subtle, both internal and external, to help guide future direction and realize opportunities. Great Strategic Thinkers take all of this in, so that as they set aside time to think, they have a full deck of information to guide them. Sometimes, its an aha moment on vacation, when they observe something that resonates; it might be on a morning walk out in the country; it might be what someone says as they serve them coffee. Making links, however tenuous, is what makes this work so well. Review Often The best Strategic Thinkers check that their thinking has been validated. Is it going to work, against a world of regular, consistent and yet sometimes volatile change? This activity is a moving target, so to build a better understanding, snapshots; benchmarks and regular stocktaking are all very useful to confirm the quality of the thinking and absorbed into the skillset for their and their organizations future. Learn from Experience Over time, these folk use their experiences, small and large, to think better on strategic issues. This makes their use of this time really efficient and particularly effective. There are learned short-cuts to the perhaps more formalized strategic planning process and experience is a huge, valuable added bonus. Use a Team

By utilising more than just their own brain (though this is vital for some of the process!), those great at Strategic Thinking bounce ideas off others in the workplace and encourage their input above and beyond their delivery of the day job. The old adage that 1+1=3 in the input of thinking is hugely valid. And 5 people make a much more significant contribution than 2 and so on! Realism Rules (A Little!) Although they create ideas very openly, key strategic thinkers have a sense of realism and honesty about what is achievable in the longer term. This is not to hold them back; more it is to deliver success. They underpromise and overdeliver, whilst also ensuring that the day to day business of the organization the now is served adequately too. Thats what gets the business paid today, whilst building the future of tomorrow. Have Clear Milestones By creating checks in their thinking, to review progress, they have the opportunity to tweak. They have an innate ability to spot the twists and turns necessary. A 5,000 mile journey by a jet plane reaches the destination only by regular and consistent course checks and adjustments. Are Non-Judgemental Because the route to a successful future is not bounded by judging their, or others, thinking as they get creative that is for elsewhere better ideas flow. Open minds are encouraged and the detail tested later. Open minded thinking needs real checks and balances but AFTER the openness has stimulated the breadth of imaginative ideas only such freedom can provide. In the most successful organizations over the years and decades, where the test of time has shown them the excellent businesses they are, the Sonys, Coca Colas, Nokias and Toyotas of this world think ahead and encourage great Strategic Thinking at least somewhere in their busness plans. In a cut-throat today world of this years bonus and dividend, big business has a tendency to look short-term and manage that efficiently and well. A sustainable future needs more, whatever size your business is.

What Are Strategic Thinking Skills?

By Craig Woodman, eHow Contributor

It is important for any business leader to set goals for where he wants his business to be in the future. Strategic thinking will help you meet these goals through a process of developing your skills in creative problem solving and teamwork, as well as your critical thinking skills. To be a strategic thinker, you must be able to see the end result of your vision, and work backward from that point to where you are at the present; then build the correct road map to move forward.

1. Organization and Observation

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To implement strategic thinking in business, you must first define what your organization needs to look like in order to meet your goals. Consider the work that must be accomplished and the skills that the ideal workers will have to do so. Observe who in your organization has these skills. If they are in other departments, you may be able to redeploy them into the places where you need them. Look at how you can find people with these skills from outside your company, or think about how to train the people within your organization to master new, necessary skills.

Lenses
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Strategic thinking requires you to look at business approaches through different views or lenses. When you look at your business through an environmental lens, you are considering how your business fits in to the community and how your business affects the places where it operates. Looking through a marketplace lens lets you consider how your suppliers and vendors affect what you do. The measurement lens focuses on how you will measure the performance of your business, or which metrics determine the overall health of the business.

The SWOT analysis

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The strength, weakness, opportunity and threat analysis (SWOT) is a great exercise in strategic thinking. In this, you identify your business' or personal strengths, or what you do well. Equally important are the weaknesses, because you need to know what you don't do well and develop plans to remedy this. List your opportunities, or the best potential for future gains in your business, as well as the threats, or the things that can come from nowhere to derail your plans. This is a good exercise for plotting the strategy of your business.

Ideal Position
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Take the necessary time to write down the ideal position of your business. This is a type of goal setting, but it is more; it is not just the things you wish to accomplish with your business, but also how your business will look if all of the variables are the most favorable. Include the conditions necessary for your business to thrive. Also include the particular niche market that your business fills in its ideal condition. List the competencies and skills that you will need to get your business where it needs to be.

How to Develop Strategic Thinking Skills in Business

By an eHow Contributor

Strategic thinking is a process in which you develop a vision for your business and then work backwards to develop a plan to accomplish that vision. Without vision, a business will have no direction, but it's impossible to achieve a vision without a strategy. Strategic thinking involves developing skills in creativity, problem solving, teamwork, critical thinking and flexibility. Strategic thinkers are able to see the big picture, as well as how to attain it.

Instructions
Learn to Think Strategically
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1
Examine the status quo. Strategic thinking skills require you to examine how things have always been done critically in order to determine if that is the way things should be done. Strategic thinkers are willing to look outside of the norm to find more efficient and creative ways of doing things.

2
Look at the forest, not the trees. Strategic thinkers are not mired down by the details of managing day-to-day issues. Strategic thinkers look at the organization as a whole to assess attributes and areas of opportunity.

3
Focus on the future. Strategic thinking is goal oriented and guided by a vision for the future of a company. When you are developing strategies for business growth, those strategies must have clearly defined goals that contribute to the overall vision for the company.

4
Consider external forces when you develop a strategic plan. Governmental regulations, legal developments, market conditions, economic factors and technological developments can all affect how you plan for the future.

5
Get feedback from within your industry. Market research, particularly in product-driven industries, can help you match the vision for your company to consumer expectations.

6
Check the facts. Even though strategic thinking involves making predictions about the future, those predictions must be realistic. Gather hard data, including your organizations financial reports and analysis of your industry, to inform your predictions and help you develop goals based in reality.

Consider the organizational structure of your business and assess how that team fits into your strategies for the future. You may have to reorganize your team to achieve your goals.
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8
Anticipate challenges. An important part of thinking strategically is being able to predict what issues will arise and devising a plan to confront those issues ahead of time.

Tips & Warnings

Develop a vision for your company by thinking about the future needs of your industry. Use past indicators to predict the evolution of your market, and then define your role within that future market. Remember that any plan based on assumptions or predictions must be flexible in case the future does not turn out the way you thought it would. Flexibility is an important part of strategic thinking skills.

Strategic Thinking Methods

By Candace Webb, eHow Contributor

Strategic thinking provides a foundation for current and future business decisions. John Voyer, an associate professor at the University of Maine, wrote in his paper "Techniques for Improving Strategic Thinking" that successful strategic thinking involves the ability to think differently. Learning what some of the more common strategic thinking methods are allows you to understand how they each fit into the larger picture.

Adaptable
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The adaptable strategic thinking method is flexible. Instead of having a plan carved in stone with the rigidity of granite, an adaptable strategic-method thinker designs a loosely based idea of how the business will run and makes adjustments as things arise. For example, hours of operation are set for the year for retail businesses, but as holidays, tax return season and peak shopping events arrive, the hours are temporarily adjusted to garner the most benefit from such changes. A business owner who uses the adaptable method should not use reactive knee-jerk ideas but should remain open to changing direction as needs dictate.

Goal-Oriented
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The goal-oriented strategic thinking method provides a figurative carrot in front of the horse. Financial or production goals are determined. The company then comes up with a plan to meet those goals. For example, the business owner decides he wants to achieve $10,000 in sales each month. This means he needs to average $2,325 per week. Once he knows this, he can plan his days to achieve the numbers. This means different things to different businesses. Whether it is making X number of sales calls, offering a meal deal to every customer in the restaurant, or getting Y number of widgets through the assembly line each hour, the goal is broken down into attainable steps and then accomplished.

Fact - Based
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Regardless of the goals and ambitions a company has, the facts are important to remember. Local economy, competition, overhead and ability to employ enough workers all come into play when it comes to strategic thinking. Aligning goals and desires with the facts as they currently exist will keep the goal setting realistic and attainable.

Focused
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Narrowing the field will give you clarity. Focused strategic thinking removes all excess and focuses on a narrowly defined criteria. For example, instead of trying to rework an entire store and its outcome, focused thinking might tackle the product display first. For a month, all ideas and brainstorming will be devoted to rearranging the products to be more eye pleasing and easy to access. Once this is completed, focused thinking might move to hours of operation and spend some time examining what they are and whether they should be adjusted. Focused thinking breaks the large picture down to individual components and works on them one at a time.

Strategic Thinking and Business Planning

Businesses are formed with specific, well established goals in mind. Business planning is an organized way for a firm to achieve short-term and long-term goals--determined through strategic thinking. Strategic thinking is the how to of getting things accomplished to realize goals. Strategy allows managers and other key personnel to plan business activities effectively, which translates into the realization of long-term goals.

Basics of Strategy
o

According to William J. Rothwell, Patrick E. Gerity and Elaine A. Gaertner in their book Linking Training to Performance, strategy is defined as a planned, systematic course of action that aligns an organization with its environment in such a way that can positively impact its future.

Strategic Thinking
o

Strategic thinking involves fact and data collection, synthesis, creativity, intuition and seeing relationships and patterns in objects, structures and people in an organization's internal and external environment. It focuses on the long-term rather than the short-term. Strategic thinking involves utilizing resources at hand and deriving maximum potential from them. It is both a creative and an analytical process, allowing an organization to capture, assimilate and analyze data and input that information into creating or reinventing an organization's vision/goals.

Business Planning
o

A business plan, according to Peter McCann in his book Strategy and Business Planning of Privately Held Companies, sets out marketing, administrative and operations tasks. Business plan activities are short-term and specify a firm's activities for its first three or five years of operations. Business planning includes functional plans (finance and administration, people management, human resources and purchasing) for various departments of an organization.

Strategic Thinking and Business Planning : The Link

o

Strategic thinking determines the business plan. Strategic thinking takes a broader view of the business, its roles and expectations, environmental impact and long-term vision. A business plan is narrower in scope and defines day-to-day operations that allow the organization to function. Strategic thinking is long-term and involves the president while business planning is short-term and involves the president along with senior management.

Strategic Business Planning

o

Strategic business planning involves key personnel who decide among themselves what the organization aims to achieve and how it proposes to do so. According to the book Linking Training to Performance, successful strategic business planning must aim to address and clarify five points: the organization's mission, its vision, key environmental issues, organizational strategy, and the various monitoring and evaluating tools and techniques proposed to ensure that the organization's progress is monitored

Why Is Strategic Thinking So Important To The Success of Any Business?

Strategic planning is a systematic way of planning for the future, but it's based on strategic thinking. Remember that a major business function is to create a sustainable (something that works long-term) means of creating revenue so you can pay the bills. One reason many businesses fail during the first year or two is that the business owners do not think through their longer term strategies, and when things in the world change, they either lack the resources (i.e. capital, talent) or the business strategies, to allow them to remain competitive. Thinking strategically involves looking not just at the present, but the future. Here's an example of the failure to think strategically. In July, 2006 Google introduced what's called a Quality Score that affected the advertising rates for paid advertising on their sites. For some business owners, the Quality Score resulted in huge increases in advertising costs, such that the companies could no longer be competitive. For companies that thought strategically, this meant that they had to use other ways to generate visitors and sales to their websites, but they had planned for such eventualities, to ensure they weren't totally reliant on any one method of making sales. Thinking strategically resulted in these companies having a "plan B", and even a "plan C". For other companies, however, who did not think strategically and relied completely for revenue on cheap Google based advertising, they were stuck. They couldn't afford to pay the new ad costs, and they had nothing in place to replace the revenues those ads used to generate. The result was that those companies were stuck. Backs to the wall, some of these companies, out of desperation, tried to cheat the new Google system, which is not strategic or sustainable, since eventually Google would once again remove their access to low cost advertising. Even more honest companies ended up losing considerable amounts of revenue (revenue they could not afford to lose) while they scrambled to figure out what to do next. In short, regardless of business, strategic thinking helps you anticipate changes in the environment, and plan for them so you are prepared and don't go under.