Planning is a management function that involves making decisions about goals and activities to be pursued in the future by an organization. It is a purposeful effort directed and controlled by top executives and draws on knowledge and experience throughout organization. Effective planning helps organizations adapt to change by identifying opportunities, improving decision-making and avoiding crises. Planning sets the direction for other functions of management and for teamwork. All levels of management engage in planning.
Strategic planning is the process of developing and analyzing the organization's mission, goals, strategies, and allocation of resources. A strategy is a course of action designed to achieve long-term goals. Strategies may take two, three, or as many as five years to implement. The length of time is generally determined by how far in the future the organization is committing its resources. Goals are the ends that the organization strives to attain. Many companies are moving to a system of continuous planning, to permit quicker response to changing conditions.
Strategic planning produces decisions and actions that shape and guide what an organization is, what it does, and why it does it. It requires broad-scale information gathering, an exploration of alternatives, and an emphasis on the future implications of present decisions. Top executives must answer such questions as "What is the purpose of this organization?" "What does this organization have to do in the future to remain competitive?" (Allen, 2002.) In the strategic planning process, the top executives define the organization's mission, analyze its strengths and weaknesses, identify opportunities and threats (SWOT), set goals and objectives, develop tactics and operations, and monitor the ...