Why would you recommend the Institutionalising of Strategic Management through a participative planning workshop?

What are the benefits and what agenda would you follow at the workshop?

By B. W. Murimirwa

Institutionalisation of Strategic Management

This question was basically asking me how strategic management can be out into practice in a participative manner, as well as how and why I would cover the whole process

Institutionalisation of Strategic Management

To answer the question, I broke it down into four parts as follows: Briefly, what is Strategic Management? How would you put it into practice in a participative manner? What agenda would be followed at the participative workshop? Why should Strategic Management be done in a participative manner? (What are the benefits?)
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Briefly, What is Strategic Management?

Strategic Management is an ongoing and systematic process that evaluates, in the long term, the business and industry in which a company is involved in; assesses its competitors and formulates strategies to outwit existing (and potential) competition; and then reassesses each strategy regularly to determine how it has been implemented and whether it has succeeded or needs replacement with a new strategy to meet changed circumstances, new technology, new competition or a new operating environment. Lamb (1984)

Briefly, What is Strategic Management?

Stated simply, strategy is a road map by which an organisation moves from a current state of affairs to a desired future state. Strategy allows a company to position itself effectively within its environment to reach its maximum potential, while monitoring the environment for changes that can affect it so as to make changes to its strategic plan accordingly. In short, strategy defines where you are, where you are going and how you get there.

How would you put Strategic management into practice in a participative manner?
Although a strategic sense of direction is important for an organisation, it can stifle creativity and its ability to be implemented if not done properly a participative strategic planning workshop can help minimise such adverse effects. I have taken participative strategic planning in this sense to be the bringing together all of organisational stakeholders in crafting a strategic plan so that each one participates in the strategic formulation before an organisation draws up its strategic plan for implementation. These stakeholders include employees, (senior) management, Board of Directors, suppliers and customers were possible all of who are affected in one way or the other by the firms chosen strategy A danger of not consulting widely in strategic formulation is the common handicap whereby strategies undergo only brief periods of usefulness or where strategies either tend to be too narrow in focus to build a complete corporate strategy on or too general and abstract to be applicable to specific, practical situations.

How would you put Strategic management into practice in a participative manner?
Strategic planning as a formalised business process has been in practice for almost forty years, but worryingly and commonly it, a lot of organisations have no clear concept of how to effectively conduct the planning process. As a result, most strategic plans never make any real impact on an organisation and its activities Fortunately, in the past decade, there have been attempts to clarify the major components and processes of strategic planning. It has thus become easier for an ordinary organisation to effectively create and implement a first rate strategic plan. Recent studies and leading management theorists have advocated that strategy needs to start with stakeholders expectations and use a modified balanced scorecard that includes all stakeholders.

How would you put Strategic management into practice in a participative manner?
Developing corporate strategy should be interactive, where participants are given time to question and/or improve the intended objectives or implementation method. Initial corporate objectives may need to be altered if there is no feasible implementation plan that will meet with a sufficient level of acceptance amoung the range of stakeholders or if the required resources are not available. All stakeholders should be involved in strategy development to ensure that it addresses relevant problems and issues, as well as to provide practical solutions to enable the firm to gain a larger market share. This avoids ivory tower strategies. Strategic formulation should follow a participatory and demand driven or needs based approach, hence stakeholders need to be consulted regarding their requirements, needs and expectations.

How would you put Strategic management into practice in a participative manner?
Participative strategic planning (through a workshop) can be done in the following ways: Bottom up approach. This is where employees are allowed to participate at the planning stage through submission of strategic proposals to management , who then in turn funnel the more useful ideas further up the organisation. Top bottom approach. This is the most common approach, where usually the CEO (probably with the assistance of a strategic planning committee) decides on the overall direction that the firm should take. Collaborative approach. This is whereby the management team, strategic planning committee, employees and other concerned stakeholders jointly and collectively decide on the strategy an organisation can adopt and implement. After all the information is collected from the participants, the strategic planning team then evaluates the data, and uses the organisations strengths and opportunities (both existing & potential) to formulate the final strategic plan. This team should be composed of top level managers capable of representing the interests, concerns and opinions of all relevant stakeholders.

How would you put Strategic management into practice in a participative manner?
There are however other ways in which strategic planning can be done through stakeholder engagement. In the early days of Hewlett-Packard (HP), Dave Packard and Bill Hewlett devised an active management style that they called Management By Walking Around (MBWA) were senior management at HP spent time visiting employees, suppliers and customers. This direct contact with key stakeholders provided them with a solid ground on which viable, successful strategies were crafted for the company. A successful strategic plan is executed when stakeholders contribute in every phase of the planning procedure. A problem solving strategic plan also needs relevant feed forward information from its stakeholders. It is thus imperative that a participatory method of strategic planning be applied to ensure a needs based strategy which can realistically be implemented and provide benefits to the different stakeholders.

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How would you put Strategic management into practice in a participative manner?
Advertising is key to successful implementation of the strategy. The more often employees hear about the plan, its elements and ways to measure its success, the greater the possibility that they will undertake it as part of their daily work. It is especially important that employees are aware of the measurement systems and that significant achievements be rewarded and celebrated. This positive reinforcement increases support of the strategic plan and belief in its possibilities. The strategy should have the support of at least most members of the firm, but of course, the companys leader is its most influential member. His support and implementation of the strategic plan into daily activities greatly increases the likelihood that other people in the organisation will do the same.

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What agenda would be followed at the participative planning workshop?

The Strategic planning team would host the workshop, and obviously begin by welcoming participants, introducing themselves (as well as having participants introduce themselves) and explaining to them the purpose of the workshop, which will be to gather relevant ideas on the firms strategy from each of them. The team can then present their overview to the stakeholders, and seek confirmation from the stakeholders that they indeed understand the general direction the organisation wants to take and how that strategy will affect the different stakeholders differently. Questions can then be invited from the floor, should they have any. The stakeholders can then be divided into groups to have discussions amoungst themselves, brainstorming on the firms strategy. The groups can then make presentations/give feedback to all workshop participants on how they feel about the firms strategy, what they may want incorporated or changed, why they feel that way and which specific areas they may want addressed. This method will ensure that all approaches of gathering strategic information (bottom-up, top down and collaborative) are taken into account. The strategic planning team should ensure that relevant information gathered from the workshop participants is taken up when the final strategy is formulated and implemented. Stakeholders are more likely to take ownership of the strategy and make it a relevant, working one if their suggestions are incorporated in the final strategy.

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Why should strategic planning be done in a participative manner?

This section looks at the benefits of coming up with a strategic plan in a participative manner. Participative planning ensures that pertinent questions related to the firms chosen strategic direction are answered. Such questions may include: Which business should the organisation be in? How does being in that type of business create synergies and/or add to competitive advantage of the corporate as a whole? Why does the organisation exist? Where is the organisation now? Where does it want it to be? How does it get there?

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Why should strategic planning be done in a participative manner?

Strategic planning in participative manner is done for the following reasons: To educate management, employees and other stakeholders on the chosen corporate strategy. It allows for the planned utilisation of the organisations resources in a manner that enhances performance of the firm in its external environment. Allows buy in and ownership from the concerned stakeholders. It allows the organisation to check if the corporate culture fits in with the chosen strategy. It allows for an environmental scan which highlights all pertinent aspects affecting the organisation ,whether external or industry based. This will also show areas on which the firm can capitalise on in addition to areas in which expansion or growth can be pursued. It shows whether the chosen strategy will address the key strategic issues underlined by the organisations strategic position (sustainability). It assesses whether the resources required to implement the strategy are available, or can be developed or obtained (feasibility). The organisations strategy can be measured for effectiveness through conducting a SWOT analysis analysing the internal strengths & weaknesses and the external opportunities & threats

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Why should strategic planning be done in a participative manner?

It is significant in defining and setting up a corporates long term goals, as well as its mission, vision, objectives and values. Provides direction and guidance to employees, setting up measurable goals and a time span to achieve them, and designating duties to all corporate personnel. A well formulated and implemented strategy will ensure survival, success and growth of the organisation. It allows for uniformity of purpose, provides a basis for resource allocation, guides organisational culture, establishes corporate boundaries, facilitates accountability and enhances performance. Allows for the detailed layout of paths by which the company plans to fulfil its mission and vision. This involves defining the firms major lines of businesses, identifying/establishing critical success factors and identifying strategic thrusts to pursue. Allows for the closing of any performance gaps that will have been identified through gap analysis. This involves looking at the current state of affairs against the desired state of affairs and then determining what needs to be done to ensure that the desired future state becomes a reality.

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Why should strategic planning be done in a participative manner?

Allows for organisation to build on its strengths to exploit existing and future opportunities, while managing risks arising from internal weaknesses and external threats. Allows for contrasting strengths against weaknesses to determine if the organisation has enough strengths to offset its weaknesses. At an external level, a similar contrast can be made between existing opportunities and threats to determine whether the organisation is capitalising on opportunities to offset emerging threats. Leaves room for a change in the strategic direction in pursuit of organisational objectives should there be unforeseen circumstances or a change in operating environment. This is done through contengency planning.

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Institutionalisation of Strategic Management

THE END

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