Strategic Planning and Customer Understanding
The constantly changing business environment makes it necessary for companies to also change and operate dynamically. The ability of companies to maintain competitive advantage in the dynamic environment depends on how well they are capable of managing their customers. This can be effective if only companies can be capable of learning about their customers and strategically planning to address the needs of the customers. In the past, companies have had strategic plans that did nothing other than acting as decorations. However, there is need for companies to draft strategic plans that will be the drivers of action (Ashkenas, 2013). Strategic plans are made to link organizational resources to the future aspirations. While doing this, the organization has to lay down goals and plans and to decide how far into the future the strategic plan is desired to go. The products in the organization and the level of technological advancement are both essential factors to consider when deciding how far into the future the plan should go.
Although technological changes mainly affect organizations that deal with technology, it should be considered in other organizations as a factor of production. Moreover, the lead time and the environment of operation should also be considered. The lead time in this case refers to the time between formulation and implementation of the strategic plans as well as the duration required by the plan to attain maturity. The organization’s life cycle and the validity of the strategic plan also affect the length of the implementation time (Harrison, 2005). The key objectives in the implementation of organizational plan is to achieve business well being. As such, both scope and the decision making process outlined in the strategic plan, dictate the timing and direction of transformation. The scope of the strategic plan can help businesses to choose from an available range of alternatives. In this way, businesses can chose the best ways to utilize other opportunities.
The scope of the organization’s strategic plan takes into consideration the company’s key competencies and serves as a hedge that buffers the organization against the competitors. The outlay of the strategic plan involves the analysis of the company in terms of its key strengths, weaknesses, opportunities and threats without focusing only on the organization’s SWOT. In addition to this, the strategic plan transcends the SWOT to include aspects of organizational growth. The plan is the intersection of the departments in an organization since it includes the plans of all the individual departments and places them together while considering all the suggestions and opinions from the departments (Thompson, 2013). The formulation of a strategic plan involves several stages. The first stage is the identification of organizational vision and mission followed by the analysis of the internal and external organizational environment. The formulation of the strategic plan is followed by constant evaluation to determine whether the organization is moving in the right direction.
The process of strategic planning in retail encompasses the very crucial step of situational analysis. The situational analysis involves review of available opportunities for the organization and allows organizations to develop departmental goals. The review of the company’s target market enables the organization to tailor its marketing strategies to the market needs and conditions at any particular time. It also involves review of customer behaviors such as their purchasing trends, successful loyalty programs and creation of products that will be instantly successful in the market while also ensuring that the customers available are retained (McNaghten and Passino, 2011).
Ashkenas, R. (2013, October 1). Four Tips for Better Strategic Planning. Harvard Business Review. Retrieved from http://blogs.hbr.org/2013/10/four-tips-for-better-strategic-planning/
Harrison, E. F. (2005). Strategic planning maturities. Management Decisions, 33(2):48-55. ProQuest
McNaghten, M. & Passino, C. (2011). Understanding Customer Retention In The Retail Industry. Deloitte. Retrieved from https://www.deloitte.com/assets/Dcom-Peru/Local%20Assets/Documents/CB_understanding_customer_retention.pdf
Thompson, L. (2013). The Value of Strategic Planning. IB Mag. Retrieved from http://www.ibmag.com/Main/Archive/The_Value_of_Strategic_Planning_12283.aspx
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