Strategic Management Cycle

A useful way we have found to help organisations plan and think strategically is by using the strategic management lifecycle model.

This involves four main elements:- Strategy formulation, Planning, Implementation, & Review

Strategy Formulation – this is where you define your objectives in broad terms. What you want to achieve, where do you want to be over the medium term. This could be things like ‘we want to have 20% market share in three years time’, a turnover of x per year in 5 years time, x number of members, x number of satisfied customers etc. Whatever your performance metrics are they should be defined here. In the formulation of strategy you want to define your organisational values, niche, ethos. What you stand for what is your mission. These may not have changed but it is useful to reaffirm them to be sure they guide further development. Horizon scanning as it is sometimes called is where you look internally and also externally. What are your competitors and partners doing and how should you respond. What external developments are likely to offer threats or opportunities to you. These might be political, economic, legal, technological etc. In short your organisational strategy should encompass both an internal and external appraisal of the environment you will be operating within over the medium and longer term.

strategic-management-cycle

Brainstorming is where you gather together people from different elements of your organisation to do some blue sky thinking. This is where there are no bad ideas. Hopefully no personal pet projects or interference from office politics. The purpose is to think creatively to come up with ideas to move the organisation forward. These sessions can be extremely productive. We suggest they are facilitated by an external coach or chair.

Planning is where the broader direction defined within the strategy formulation process is built into the organisation governance framework. In other words broad aims are specified into action plans that staff teams can enact. For example if your strategic aim is to increase sales this might be enacted through your action plans through a series of statements such as ‘increase marketing activities through the following media channels’, ‘increase the number of sales people from x to y’, ‘promotion and development of new products via the following events’ etc. So the broad aim to increase sales is supported by some concrete measureable actions within departmental action plans. Planning should translate a top level strategy into actionable activities that your staff can implement. We would suggest the use of action plans and SMART targets for this activity as planning is where the strategy begins to become a reality.

Implementation is where the strategy is enacted. It is where the action plans are given out and the real work happens. During implementation real world problems will arise and will need to be managed. Plans may need to be adapted and modified.

Review is the time when you need to ask where you are and where do you want to be. We suggest getting an external viewpoint on where you are. Review is the phase where you want to see what worked well and what did not work so well. In overall terms did your strategy meet it the objectivers defined at the outset. What did you learn during the process and how will you capture the knowledge for the future.

Continuous Improvement is key to this approach. Once the cycle has been completed it begins again as this process is underpinned by a continuous improvement philosophy. You never rest on your laurels or feel that you have ‘arrived’. The idea is that you are always seeking to improve further and adapt in a changing environment. The timescale of the cycles will vary according to the organisation type and size but is intended to be medium term (2-5 years).

Communication and consultation of your strategy. This is one of the key elements that people often forget or fail to give sufficient prominence to. A strategy that has been written by an individual or a small group is highly unlikely to be successful. A strategy that does not have the support of people from across the organisation is not going to succeed. Any strategic initiative will take your people out of their comfort zones and will challenge them to think differently about what they do. In order to bring people with you you will need to consult and communicate effectively throughout the process. This is not easy but there are some key concepts that will help. The most important is to recognise that your customers/clients, stakeholders and importantly your staff are a huge source of talent which you should be aiming to draw upon.  Do not think of consulting staff as a chore think of it as an opportunity to harvest their ideas and enthusiasm to make your strategy come to life. Pose questions then listen and record their responses. Prompt debate about the best way forward. Create a dynamic atmosphere where all ideas are valued and evaluated against your high level objectives/mission.

By Martin Sepion

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.