Understanding the Dynamics of Strategic Planning
Understanding the Dynamics of Strategic Planning
From John M. Bryson, Strategic Planning for Public and Nonprofit Organizations: A Guide to Strengthening and Sustaining Organizational Achievement (1995)
1. Why Strategic Planning in Public and Nonprofit Organizations is More Improtant Than Ever
Prevalence of upheaval and change. Demographic changes, shifts in values, increased interest-group activism, privatization of public services, unfunded federal and state mandates, shifts in federal and state responsibilities and funding priorities, a volatile global economy, increased importance of the nonprofit sector.
Organizations that want to survive and prosper must respond to these changes. Organizations typically experience long periods of relative stability; also typically encounter periods of rapid change.
Stephen Jay Gould: “Life seems to be characterized by long stretches of boredom punctuated by periods of intense terror.
Ënvironmental and organizational changes are aggravated by the increased interconnectedness of the world. Changes anywhere typically result in changes elsewhere (financial crisis). Since the mid-1970s, blurring of traditional distinctions:
Domestic and international spheres;(world economy);
Policy areas (educational reform as a type of industrial policy”);
Public, private and nonprofit sectors (private and nonprofit organizations as service providers)
Blurring of boundaries—moved to a world in which no one organization or institution is fully in charge, and yet many are involved or affected or have a partial responsibility to act. Increased jurisdictional ambiguity requires public and nonprofit organizations (and communities) to think and act strategically as never before. Strategic planning is designed to help them do so.
2) Purpose and Benefits of Strategic Planning
What is strategic planning:
Ä disciplined effort to produce fundamental decisions and actions that shape and guide what an organization is, what it does, and why it does it.
To deliver the best results, strategic planning requires broad yet effective information gathering, development and exploration of strategic alternatives, and an emphasis on future implicaitons of present decisions.
Strategic planning can help facilitate communication and participation, accommodate divergent interests and values, foster wise and reasonably analytic decision making, and promote successful implementation.
Most work on strategic planning in this centruy has focused on for-profit organizations. Until the early 1980s, strategic planning in the public sector was applied primarily to military organizations and the practice of statecraft on a giant scale.
It can be applied, however, to a number of public and nonprofit organizations. Specifics of implementation differ for each one. For example, when strategic planning is focused on an organization, it is likely that most of the key decision makers will be insiders. When most of the key decision makers are insiders, it iwill likely be easier to get people together to decide important matters, reconcile differences, and coordinate implementation activities.
When strategic planning is focused on a function—often crossing organizational or governmental boundaries—or on a community, almost all of the key decision makers will be outsiders. In these situations, the focus will be on how to organize collective thought and action within an inter-organizational network in which no one person, group, organization, or instituiton is fully in charge. It will likely be more difficult to organize an effective strategic planning process in such a “shared-power”context.
3) Why do organizations engage in strategic planning?
• Facing conflicting demands; need to identify priorities;
• Pressure for outcomes to justify continued resources;
• Increasing demands, shrinking resources;
• Leadership change;
• Moment of transition; legacy?
4) Regardless of why public and nonprofit organizations engage in strategic planning, similar benefits are like to result:
1) Promotion of strategic thought and action;
• More systematic information gathering about the organization’s external and internal environment and various actors’interests
• Heightened attention to organizational learning;
• Clarification of the organization’s future direction;
• Establishment of organizational priorities for action.
2) Improved decision making.
• Focuses attention on the crucial issues and challenges an organization faces;
• Helps key decision makers figure out what they should do about them.
• Coherent and definsible basis for decision making
3) Enhanced Organizational responsiveness and improved performance.
• Organizations engaging in strategic planning are encouraged to clarify and address major organization issues;
• Respond widesly to internal and external demands and pressures;
• Deal effectively with rapidly changing circumstances.
4) Benefit the organization’s people.
• Policy makers and key decision makers can better fulfill their roles and meet their responsibilities, and teamwork and expertise are likely to be strengthened.
Although strategic planning can provide all these benefits, there is no guarantee it will. Indeed, it is highly unlikely that any organization will experience all or even most of the benefits of strategic planning the first time through—or even after many cycles of strategic planning.
The process will work only if enough key decision makers and planners support it and use it with common sense and a sensitivity to the particulars of their situation. Even then, success is never guaranteed, particularly when very difficult strategic issues are addressed.
Not always advisable. If an organization lacks the skills, resources, or commitment by key decision makers to produce a good plan, strategic planning will be a waste of time. Paradox of strategic planning: it is most needed where it is least likely to work and least needed where it is most likely to work.
Purpose of strategic planning is to produce fundamental decisions and actions that define what an organization is, what it does, and why it does it. A good antidote to relying on the intuition and vision of even extremely gifted leaders instead of on formal strategic planning processes.
A reasonably structured and formalized strategic planning process helps organizations gather the information necessary for effective strategy formulation. It also provides the discipline and commitment necessary to effectively implement strategies.
Strategic planning should not be undertaken if implementation is extremely unlikely. Engaging in strategic planning when effective implementation will NOT follow is the organizational equivalent of the average New Year’s resolution.
Organizations simply may not know where to start the process. Good news: strategic planning can begin almost anywhere—the process is so interconnected that you end up covering most phases via conversation and dialogue, no matter where you start.
What Strategic Planning is NOT
Not a panacea. Simply a set of concepts, procedures, and tools designed to help leaders, managers, and planners think and act strategically. Used in wise and skillful ways by a “coalition of the willing,” strategic planning can help organizations focus on producing effective decisions and actions that further the organization’s mission, meet its mandates, and satisfy key stakeholders. NOT a substitute for strategic thinking and action.
Not a substitute for leadership.
Not synonymous with creating an organizational strategy. Organizational strategies have numerous sources, both planned and unplanned. Strategic planning is likely to result in a statement of organizational intentions, but what is realized in practice will be some combination of what is intended and what emerges along the way.
Strategic planning can help organizations develop and implement effective strategies, but they should also remain open to unforeseen opportunities. Excessive reverence for strategic plans can blind organizations to other unplanned and unexpected—yet incredibly useful—sources of information, insight, and action.
Why Strategic Planning is Here to Stay
Yet another new management technique? Perverse management hazing or “status degradation ritual”?
Not just a passing fad. Builds on the nature of political decision making. So many other management techniques fail because they ignore, try to circumvent, or even try to counter the political nature of life in private, public, and nonprofit organizations. Most of these new management innovations have tried to improve government decision making and operations by imposing a formal rationality on systems that are not rational, at least in the conventional meaning of the word. Public and nonprofit organizations are politically rational. Thus, any technique that is likely to work well in such organizations must accept and build on the nature of political rationality.
Rational-deductive approach to decision-making: goals, policies; programs; actions. Only in fairly centralized, authoritarian, or quasimilitary bureaucracies will this assumption hold—that there will be a consensus on goals or that consensus doesn’t matter.
Political decision making model==inductive, not rational-deductive. Begins with issues, which by definition involve conflict, not consensus. Various policies and programs are, in effect, treaties among the various stakeholder groups. Represent a reasonable level of agreement.
The heart of the strategic planning process that we are going to try to work with is the identification and resolution of strategic—i.e. very important—issues.
Strategic planning accepts political decision making’s emphasis on issues and seeks to inform the formulation and resolution of those issues. It will last in government and non-profit organizations because it accepts and build on the nature of political decision making.
Two models not inherently antithetical—need to be sequenced. Political decision-making model to work out consensual agreements; rational planning model can recasst that consensus into the form of goals, policies, programs, and actions.
Intense attention to stakeholders and their interests, external and internal environments, and strategic issues at the core of the approach.
Strategic planning efforts differ in:
• Extent to which focused directly on the organization and what it should do or on what should happen in the community of which the organization is a part;
• Different reasons – improve performance, transition, resource crisis, improve management?
Successful planning efforts have:
• Leaders that are willing to act as process sponsors to endorse and legitimize the effort;
• Process champions committed to making the process work;
• A fairly clear understanding and agreement among key decision makers about what strategic planning is and what it expects from the process;
• A reasonably structured strategic thinking and acting process;
• A decision-making or advisory body to oversee the process;
• A strategic planning team to manage the process, collect information and prepare for meetings, and draft a strategic plna;
• Identified critical issues that require effective action if the organization is to avoid being victimized by serious threats, missed opportunities, or both;
• Each worked hard to develop strategies that were politically acceptable, technically workable, and ethically responsible;
• Relied on outside assistance, including consultants, to help with the process;
• Each made a point of not getting so bogged down in the process that it lost sight of what was truly importat; strategic through and action
What it is/Why important
Abilitiy to help public and nonprofit organizations and communities respond effectively to the dramatically changed circumstances that now confront them.
More upheaval likely in the future. What will the new millenium bring!
Strategic planning is one way to help organizations and communities deal with changed circumstances. Strategic planning is intended to enhance an organization’s ability to think and act strategically. It can help organizations formulate and resolve the most important issues they face. It can help them build on their strengths and take advantage of major opportunities. More effective in a hostile world.
Builds on the nature of political decision making. Strategic planning seeks to improve on raw political decision making by helping ensure that issues are raised and resolved in ways that benefit the organizations, its key stakeholders, and society.
Background to the method.
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