Will the benefits of strategic planning overcome the uncertain environment has been argued for a long time. Strategy decides the long-term direction of an organization and scopes its activities. The benefits of strategic planning have helped many companies succeeded in today’s competitive environment. But more companies failed due to the uncertainty of the environment. This essay will present a clear thought about the benefits of strategic planning will be very limited due to the uncertain and dynamic environment.
Nature of traditional strategic planning tools
Strategy is the direction and scope of an organization over the long term, which achieves advantage in a changing environment through its configuration of resources and competences with the aim of fulfilling stakeholder expectations ( Johnson and Scholes, 1999).
Strategy decides the long-term direction of an organization and scopes its activities. Take Yahoo in 2006 as an example. Yahoo was losing its advantage to the fast-growing companies such as Google. Strategy helps to take advantages for Yahoo to overcome this competition. It fits organization to position itself in the competitive environment and exploits the strategic capability of an organization, in terms of its resources and competences, to provide competitive advantage and yield new opportunities as well.
Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy. In order to determine the direction of the organization, it is necessary to understand its current position and the possible avenues through which it can pursue a particular course of action.
We will explain strategic planning better by looking at GE. In exploring the evolution of strategic planning we first define the term, as its meaning and usage varies