Strategic management involves evaluation of various situations in the organization, the available options for solving organizational issues. This article analyzes various studies on organizational behavior with regard on the aspects that are relevant for strategic planning. The article analyzed the need for explicit setting out of objectives of an organization and monitoring the results.
In the article “The Value of Formal Planning for Strategic Decisions,” Armstrong (1982) examined the importance of planning in organizations and found out that planning is very useful. He conducted an empirical study on planning in organizations that use formal planning and those that use informal planning.
Ten cases out of the studied cases indicated that formal planning improved performance with only two cases portraying negative outcome. During planning, planners should formal plan rather than an informal plan. Additionally, the stakeholders of the firm should always be involved to avoid any complications in the execution of the plan.
Objectivity is a very important factor in planning. As indicated in the article. Planning should include setting out of the goal and objectives of the firm. Without objectives, strategies laid down may not achieve the desired outcome. Implementation and monitoring is part of strategic planning (Armstrong, 1982). Proper steps in the implementation should enable the organization achieve its objectives. However, monitoring and control is vital.
Implications for Professionals Involved in Strategic Management
This article on the value of formal planning for strategic decisions is very relevant in the field of strategic management. Strategic management professionals usually run the strategic management section of any organization. These are the people behind all the strategic decision-making in the firm. The professionals are involved in strategic planning, strategy formulation, implementation and monitoring of the strategies to ensure they achieve the intended outcome.
The article outlines the importance of formal strategic planning and execution of strategies in an organization (Armstrong, 1982). It also highlights the importance of objectives in the strategic planning process. These two factors are vital for the success of a strategic plan. The professionals in strategic management will find the article relevant because of the empirical study on the importance of conducting a formal strategic plan.
Strategists in strategic management will learn to make decisions based on the objectives of the firm. The decisions made should be arrived at strategically basing on the analysis of the existing set of solutions.
Effective strategic decision-making based on formal strategic planning in an organization can result in improved performance of the company as indicated in the article. Therefore, strategic management professionals are part of the strategic resources in an organization and can help the company improve its performance by following formal strategic planning (Vermeulen & Curseu, 2008).
References
Armstrong, S. (1982). The Value of Formal Planning for Strategic Decisions: Review of Empirical Research. Strategic Management Journal, 3, 197-211
Vermeulen, P. & Curseu, P. (2008). Entrepreneurial Strategic Decision-Making: a Cognitive Perspective. Edward Elgar Publishing.