What is Strategic Planning?

Definition: Strategic planning is the process of defining the key directional elements of an organization. It is the general map given by the executives that allows the entire organization to maintain the right path in their daily decisions.

What Does Strategic Planning Mean?

Strategic planning is a systematic process that commonly embraces the definition of strategic objectives, short, medium and long-term goals and broad plans to achieve them. It generally starts with strategic statements such as company´s vision and mission. Once the strategic plan is made, every department should define more operational or “tactic” plans. Strategic planning provides the framework for all decisions to be made through the entire organization until the next strategic plan is delivered.

Every department and ideally every employee must know if his work is correctly aligned to the strategic plan. After all, consecution of objectives is not possible with few top executives but the combined outcome of all employees. In many companies, strategic planning takes place in a yearly basis but this frequency may vary. Participants can also range from the very top, like Board of Directors members working alone, to a wider group that includes top and middle management. In any case, it is a process conducted by the leadership.


Jolson & Barnt is a young company operating in retailing that successfully grew to reach 12 stores in eight years. It is a family business whose decisions are mainly taken by three brothers who hold the top leading positions. In recent years, middle management felt confused about the right direction when deciding about product portfolio, price strategy and store image. The managers did not perceived coherent guidelines from the senior executives.

Sometimes they think that the objective is to open new stores and expand portfolio but in other occasions they think that they should be cutting costs and investments in an aggressive way. After analyzing the issue, the top leadership decided that a strategic plan was needed. They, therefore, met with some advisors during a week and delivered a useful strategic plan. For example, it defined a goal to have three new stores opened for the next year and specific financial goals to reduce operational costs and increase profits.