Chapter 3 Performance Management and Strategic Planning
Chapter 3 Performance Management and Strategic Planning
STRATEGIC PLANNING
-is a process of that involves:
describing the organization’s destination,
assessing barriers that stand in the way of that destination, and
selecting approaches for moving forward.
“The main goal of strategic planning is to allocate resources in a way that provides organizations with a
competitive advantage.”
Strategic Plan
- serves as a blueprint that defines how the organization will allocate its resources in pursuit of its goals.
I. Environmental Analysis
- identifies external and internal parameters with the purpose of
understanding broad issues related to the industry where the
organization operates so that decisions can be made against the
backdrop of a broader context.
INTERNAL EXTERNAL
Organizational structure Economic
Organizational culture Political/Legal
Politics Social
Processes Technological
Size Competitors
Customers
Suppliers
Gap Analysis
- analyzes the external environment in relation to the internal environment.
II. MISSION
- the organization’s most important reason for its existence.
Mission statements include the following
components:
Answers the following question:
• Basic product or service to be offered
Why does the organization exist?
(does what?)
What is the scope of the organization’s activities?
• Primary markets or customer groups to
Who are the customers served?
be served (to whom?)
What are the products or services offered? • Unique benefits and advantages of
products or services (with what benefits?)
Mission statements include the following components: • Technology to be used in production or
• Basic product or service to be offered (does what?) delivery
• Primary markets or customer groups to be served (to whom?) • Fundamental concern for survival
• Unique benefits and advantages of products or services through growth and profitability
(with what benefits?)
• Technology to be used in production or delivery
• Fundamental concern for survival through growth and profitability
III. VISION
- the organization’s future aspirations.
V. STRATEGIES
- are descriptions of game plans or how-to procedures to reach the stated objectives. The strategies could
address issues of growth, survival, turnaround, stability, innovation, and leadership, among others.
Strategic Consensus
- occurs when the various organizational units agree on a common set of strategic priorities.
Job Descriptions
- need to be congruent with the organization and unit mission, vision, goals, and strategies. Should include
activities that, if executed well, will help execute the mission and vision.