Discuss the proposition that despite the potential advantages of formal strategic planning approaches, it is of limited benefit to organisations operating in uncertain and dynamic environments. About this discussion, I would like to introduce two steps. First step, I want to introduce the potential advantages of formal strategic planning approaches. Then I will introduce the second step: some important reasons about the formal strategic planning is of limited benefit to organisations operating in uncertain and dynamic environments. Finally, the main purpose of this paper is to prove the formal strategic planning is of limited benefit to organisations operating in uncertain and dynamic environments. My conclusion will emphasize it again. First, how should we understand the formal strategic planning? The objective of the formal strategic planning is to convey that a company’s strategic planning process includes specific systematic procedures used to gain the involvement and commitment of those principal stakeholders affected by the plan (J. Richard Falshaw, Keith W. Glaister, Ekrem Tatoglu, 2006). What is the purpose of strategic planning? Generally, formal Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to carry on this strategy. In order to determine the direction of the organization, it is necessary to know its current position and the possible ways through which it can pursue a particular course of action strategic planning do with at least one of three key questions: "What do we do?" "For whom do we do it?" and "How do we excel?” (J. Scott Armstrong, 1986)
OK, I have a simple introduction about the character and purpose of formal strategic planning. Then we must make clear about the structure about formal strategic planning approaches. There is common view about strategic planning researchers that the strategic planning process consists of three major parts: (1) Formulation (which includes developing a mission, setting major objectives, assessing the external and internal environments, and evaluating and selecting strategy alternatives). (2) Implementation. (3) Control. (J. Richard Falshaw, Keith W. Glaister, Ekrem Tatoglu, 2006). Some famous formal strategic planning approaches include SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats), Balanced Scorecards, Scenario planning, PEST analysis (Political, Economic, Social, and Technological), STEER analysis (Socio-cultural, Technological, Economic, Ecological, and Regulatory factors).
What are potential advantages of formal strategic planning approaches? Generally, formal planning has these advantages: 1. Formal plans represent a useful standard. 2. It is fully formulated; communicated plan is an important motivational device. 3. The analysis and survey by all those participating in the planning process is useful and can improve the companies' understanding of it's position.4. Plans which swift actions in anticipation of future changes in the environment is a better approach to strategic management than an advertisement to events. Take me for example, for 20 years, contradictions between the planning and process schools of strategy have shaped the debate on strategy planning. Here we illustrate that a scenario-based approach to strategic planning can serve as a new management tool in the field with the potential to overcome differences between the two opposing schools of strategy. The scenario-based approach to strategic planning builds on the strengths of traditional scenario planning. It is an open and creative approach that considers many strategy options and takes multiple perspectives into account. Synchronously, it overcomes the weaknesses of traditional scenario planning by offering a systematic process to scenario creation that is built on specific management tools and is easy to implement. The outcome of this approach is an important strategy...
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