Strategic Management: A Competitive Advantage Approach Concepts and Cases 17th Edition Instructor ma
Set 4: Individual vs. Group Strategic Planning
EXERCISE 1E
How Detrimental Are Various Pitfalls in Strategic Planning?
Answer: The Expert Ranking
Pitfalls to Avoid In Authors’ Ranking
Doing Strategic Planning (1 = most detrimental to 13 = least detrimental)
1. Using strategic planning to gain control 11
2. Doing strategic planning only to meet requirements 4
3. Too hastily moving to strategy formulation 3
4. Failing to communicate the plan to employees 6
5. Top managers making too many intuitive decisions 5
6. Top managers not actively supporting the process 7
7. Not using plans as a standard to measure performance 8
8. Delegating planning to a “planner” 10
9. Failing to involve key employees 12
10. Failing to create a collaborative climate for change 9
11. Viewing planning as unnecessary 1
12. Too engrossed in current problems to plan 2
13. Being too formal in planning 13
Rationale:
The authors have developed strategic plans for many companies. The rankings given above are based on their experience and the readings given at the end of Chapter 1, rather than being based on empirical research. First, millions of businesses, especially small businesses, view planning as unnecessary, so that pitfall is the #1 most potentially detrimental or severe. Millions more businesses report that they are too engrossed in current problems to plan, so that pitfall is the #2 most detrimental when it is encountered. Millions of businesses that do strategic planning in some form move too hastily from vision/mission to deciding/selecting strategies to pursue, bypassing the external and internal audit, so that pitfall is #3. Hundreds of thousands of businesses do strategic planning only to meet accreditation or government requirements, so that pitfall is #4. At thousands of businesses that do strategic planning, the top managers make too many intuitive decisions without using planning matrices or taking the time to gather relevant data and statistics, so that pitfall is #5. The #6 most detrimental pitfall is doing strategic planning but not communicating the plan to employees who then basically work in the dark. The #7 pitfall is top managers not actively supporting the planning process for a variety of reasons ranging from differences of opinion about the process itself to disagreement about the strategies selected for implementation. The #8 pitfall most detrimental is doing strategic planning but not using the plans as a standard to measure performance, basically just filing the planning documents away rather than using them to guide operational and strategic expectations. The #9 pitfall is failing to create a collaborative climate for change; the only constant is change and change must be viewed as essential for the firm to successfully adapt to its external environment. Less potentially detrimental are pitfalls # 10, 11, 12, and 13 listed above that, respectively, deal with delegating planning to a planner or technocrat rather than using a collaborative approach, using the planning process to gain control over decision making, failing to involve key employees to help facilitate change, and being too formal, ritualistic in the planning process.