Strategic Audit

Topics: Strategic management, Management, Strategic planning Pages: 7 (1896 words) Published: June 27, 2009
Very simply put, strategic planning identifies where the organization wants to be at some point in the future and how it is going to get there. The "strategic" part of this planning process is the continual attention to current changes in the organization and its external environment, and how this effects the future of the organization. Skills in strategic planning are critical to the long-term success of your organization. This form of planning includes:

a) Taking a wide look around at what's going on outside the organization and how it might effect the organization (an environmental scan) b) Taking a hard look at what's going on inside the organization, including its strengths, weaknesses, opportunities and threats (a SWOT analysis) c) Establishing statements of mission, vision and values

d) Establishing goals to accomplish over the next (usually) three years or so, as a result of what's going on inside and outside the organization e) Identifying how those goals will be reached (strategies, objectives, responsibilities and timelines) Strategic planning determines the overall direction and goals of the organization. Consequently, strategic planning influences numerous aspects of the organization, including what: a) Products and services will be provided by the business and how those products and services will be designed b) Organizational design and roles are needed by the organization c) Performance goals are established for positions throughout the business d) Resources are needed to reach those goals, and consequently, how much money is needed to procure those resources -- ultimately, the goals determine the content of various budgets The scheduling for the strategic planning process depends on the nature and needs of the organization and the its immediate external environment. For example, planning should be carried out frequently in an organization whose products and services are in an industry that is changing rapidly Consider the following guidelines:

1. Strategic planning should be done when an organization is just getting started. (The strategic plan is usually part of an overall business plan, along with a marketing plan, financial plan and operational/management plan.) 2. Strategic planning should also be done in preparation for a new major venture, for example, developing a new department, division, major new product or line of products, etc. 3. Strategic planning should also be conducted at least once a year in order to be ready for the coming fiscal year (the financial management of an organization is usually based on a year-to-year, or fiscal year, basis). In this case, strategic planning should be conducted in time to identify the organizational goals to be achieved at least over the coming fiscal year, resources needed to achieve those goals, and funded needed to obtain the resources. These funds are included in budget planning for the coming fiscal year. However, not all phases of strategic planning need be fully completed each year. The full strategic planning process should be conducted at least once every three years. As noted above, these activities should be conducted every year if the organization is experiencing tremendous change. 4. Each year, action plans should be updated.

5. Note that, during implementation of the plan, the progress of the implementation should be reviewed at least on a quarterly basis by the board. Again, the frequency of review depends on the extent of the rate of change in and around the organization. The process of conducting a strategic audit can be summarized into the following stages: (1) Resource Audit:

The resource audit identifies the resources available to a business. Some of these can be owned (e.g. plant and machinery, trademarks, retail outlets) whereas other resources can be obtained through partnerships, joint ventures or simply supplier arrangements with other businesses. You can read more about resources here. (2) Value Chain Analysis:

Value Chain...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Information Technology Audit Essay
  • Strategic Audit Essay
  • Strategic Direction of Fannie Mae Essay
  • Mcdonalds Strategic Audit Essay
  • Audit Essay
  • Essay about Audit
  • Essay about Audit Communications
  • Essay about Audit and Assurance

Become a StudyMode Member

Sign Up - It's Free