Summary (Chapters six and seven)
The heart of strategic planning process is the Identification of the strategic issues facing the organization (step five of the strategic planning process). A strategic issue is simply a fundamental or an essential policy question or challenge that affects the organization. A strategic issue may affect the mandates, mission and values, and the products and services level and mix of the organization. It may also affect the customers and clients, the cost, financing or management of the organization. Organization’s mission and culture are some of the issues. The culture normally affects the issues that get on board, how they are framed, and the strategic options. The need to change the culture is therefore a strategic issue, especially when the culture blinds the organization.
The creation of the strategic issue agenda requires that the issues affecting the organization are listed and divided into two categories: the strategic and the operational. Strategic issues involves more need for knowledge exploration, new concepts, changes in basic stakeholders or their relationships, and radical new technologies. The responses may include institutional redesign or changes in the basic rules, mission, vision, and goals. Operational issues are more technical in nature and involve knowledge exploitation, refinement of strategy, and process improvement. After categorizing the issues, the next step is the arrangement of the issues in a given order (priority, logical, or temporal) to help people consider the importance, nature, and implications of every issue. Attention is focused on what is really important, and on issues, not answers. The identification of issues is what necessitates organizational change. The strategic issue identification should give the useful clues about how the issues can be resolved. The strategic planning process then becomes real to the participants.
In order to identify the strategic issues, one can formulate some questions based on the mission of the organization. Answering the questions is the main agenda item for the strategic planning retreat. This takes the organization to the strategy formulation process (step six). Major strategic issues involve information technology aspect, human resources aspect and financial management aspect. These issues should be addressed in a manner that they support the overall mission and efforts of the organization to meet its objectives or mandate. When describing the strategic issue, you need to frame the issue as a question that the organization can do something about. The question should have more than one answer. Then, you need to discuss the confluence of factors, and finally formulate a statement of consequences of the failure to address the question.
When identifying strategic issues, eight approaches can be adopted. They include the direct approach, the goals approach, the indirect approach, action-oriented strategy mapping, vision of success approach, the alignment approach, the issue-tension approach, and the system analysis approach. The approach to use depends on the situation at hand. For government and nonprofit organizations, direct and action-oriented strategy mapping approaches are preferred.
As a strategic planning team, various process guidelines are helpful. First, the team should review the organization’s mandate, missions, and SWOT, including the key indicators that should be watched. Secondly, an approach that fits the organization’s situation should be selected. Thirdly, the issues should be separated into strategic and operational. The issues should then be discussed and revised as appropriate. In terms of attention, strategic issues are grouped into three: those that require no action at present, those that be incorporated as part of the regular strategic planning cycle, and those that require urgent action. Focus on the issues, not the answers. Reach an agreement and keep it light. Transition into the next step requires careful management. Strong leadership, high morale, motivation, optimism, and reasonable sense of psychological safety keep the organization on track.
Chapter seven discusses the formulation and adoption of strategies, and the plans to manage the issues. It covers steps six and seven of the strategic planning process.
Strategy is a pattern of purpose, program, policy, action, resource allocation, or decision that defines the organization, what it does, and why. It is an extension of the organization’s mission that forms a purpose-driven bridge between the organization and its environment. Strategies are developed to handle strategic issues in the sense that they respond to the fundamental challenges facing the organization. Strategies are developed to achieve the goals or the vision. Every organization has a strategy, though the strategy may not be good enough. Strategy formulation often involves highlighting the limitations of the current strategy; reframing, downplaying or eliminating what is bad; and adding the new elements.
Strategy may be focused on addressing the need for new rules, institutional redesign, adaptations in terms of new concepts, knowledge exploration, stakeholder relationships, or radical new technologies; creating a process; producing products and services, programs, or projects; controlling strategy delivery; developing future capabilities; and enhancing stakeholder relationships.
The two approaches to developing strategies are the five-part process approach, and the action-oriented strategy mapping process. In the five-part process approach, planners answer five questions about each strategic issue. The questions address the practical alternatives, dreams or vision; the barriers to realization of these alternatives; the major proposals that may be pursued to achieve the alternatives; the major actions that must be taken to implement the proposals; and the specific steps that must be taken. This approach eliminates unnecessary conflicts. The action-oriented strategy mapping process is based on the Strategic Options Development and Analysis (SODA) method. It involves creating options to address each issue. The planning team needs to be practical and creative as possible when brainstorming the options.
The chapter also highlights the preparation of strategic plans. Strategic plans very in form and content. The simplest form consists of the mission statement, mandate, SWOC/T analysis, strategic issues, and the strategies. For the proposed plan to be adopted, it must address the issues that the key decision makers believe to be important and the solutions that are likely to work. Both the decision makers and the important stakeholders must be open to change. Formal adoption is most likely to occur at a window of opportunity. Sometimes it occurs in stages over some period of time.
As a guideline, the chapter stresses on strategic thinking, acting, and learning as the most important results, rather than any particular strategy formulation approach or the preparation of formal strategic plan.
Strategic Planning for Public and Nonprofit Organizations: A Guide to Strengthening and Sustaining Organizational Achievement, 4th Edition