The six stages of strategic planning
This guide will describe each of the six steps in the strategic planning cycle.
Illustrated below is the strategic planning cycle from our strategic planning toolkit Tools for Tomorrow - a practical guide to strategic planning for voluntary organisations. It has six stages:
- Get the direction right
- Analyse the internal and external environment
- Refine options and choices
- Plan
- Implement
- Evaluate
Get the direction right
Is your organisation on the right track? Does it meet the needs of service users, clients, and other stakeholders?
Examine vision, mission, and values
This fundamental question can either seem obvious or daunting. The right approach is to refer back to your organisation's mission statement and original vision. Are those values still relevant today? Are they championed throughout the organisation?
Unless these questions are asked, there's the risk of mission drift. Mission drift means the organisation is losing touch with its service users and is off target.
Consult stakeholders
All the relevant stakeholders should be consulted, both internally and externally. Everyone who works in the organisation - including the volunteers - and the service users and beneficiaries need to be sounded out to see where they think the organisation currently sits, where it is going, and most importantly of all, where it should be heading.
Consider the pace of change
If your organisation operates in an environment that is changing rapidly, the reassessment of your direction should happen frequently – perhaps every year. Otherwise, it should be carried out once very five years or so.
Use the right tools
Useful tools for getting the direction right include:
- Stakeholder analysis
- Engaging service users
- Mission, vision and values
These tools are included in Tools for Tomorrow - a practical guide to strategic planning for voluntary organisations.
Analyse the internal and external environment
Planning requires looking at the operating environment within and outside your organisation.
External analysis
Understanding the external environment is the focus of our resources on this website. Read How to make sense of your external environment for detailed support.
Internal analysis
The internal environment is the shape and fitness of the organisation. Internal analysis tries to identify potential inhibitors that diminish organisational effectiveness. An inhibitor is a mismatch between the structure or activities of the organisation and its direction. Examples include:
- cultural changes that must take place
- training requirements
- insufficient resources
Being aware of your internal environment is the first step in dealing with them.
Use the right tools
Useful tools for assessing your internal environment include:
- Internal healthcheck
- Portfolio analysis
- SWOT
These tools are included in Tools for Tomorrow - a practical guide to strategic planning for voluntary organisations
Refine options and choices
Once analysis of the operating environment is complete, your organisation is faced with a number of options how to carry out its mission.
Thinking through the options presented by an external strategic analysis is covered in Assess Drivers.
These options need to be assessed so that an informed decision can be made. This isn't just about choice, but it is also about priority, feasibility and risk assessment.
Stay on track
Watch out for opportunities that appear like a good option but actually take the organisation off track. An organisation exists to fulfil its vision through its mission and values. Other activities should be avoided.
Take stock
This stage marks the half-way point in the planning journey, and therefore, is the ideal time for staff and trustees to take stock. Review and sort all the information generated, and prepare for detailed planning.
Use the right tools
Useful tools for assessing options and making choices include:
- Ansoff matrix
- Other player options
- Force field analysis
- Cost-benefit analysis
- Break-even analysis
The above tools are included in Tools for Tomorrow - a practical guide to strategic planning for voluntary organisations.
Plan
Detailed planning starts now. Options and choices are brought into reality.
One way of doing this is to develop some goals and targets, capture the strategy in some kind of written document and think about the resources required to deliver the plan.
Keep plans proportionate
Plans should not be weighty tomes that are complicated and burdened down with graphs and figures. They should be as easy to use as possible. They need to contain information that is both proportionate and relevant to the options chosen by the organisation.
Keep plans to hand
Plans should be like a novel that is passed from friend to friend. They should end up back on the shelf with tattered corners.
Use the right tools
Three essential skills for the planning stage are:
- Goal and target setting
- Writing a strategic plan
- Budgeting
Good practice guides on the above skills are included in Tools for Tomorrow - a practical guide to strategic planning for voluntary organisations.
Implement
If the organisation fails to implement the decisions made, all the work is for nothing.
It is one of the most frequent concerns that staff have about planning. After putting masses of effort into developing a strategy, nothing happens. Planning does take time and resources, and to ensure that the hard work and good ideas are not wasted, it is vital to ensure that the plan is fully implemented.
Focus on systems not targets
Often planning produces many goals, targets, and outcomes. But unless they are built into the fabric of the organisation in its systems and processes, they have little value.
Three essential skills in implementing strategic plans are:
- Change management
- Performance management
- Project management
Good practice guides on the above skills are included in Tools for Tomorrow - a practical guide to strategic planning for voluntary organisations.
Evaluate
Evaluating the outcomes and impact of the strategic plan marks the end of the journey for the planning cycle.
Once the strategic plan is firmly embedded throughout the organisation, it is time to take stock and evaluate what works well, and just as importantly, what doesn't work as well.
Evaluate
Progress on the journey needs to be assessed at appropriate intervals to make sure things are on track, heading in the right direction and continuing to achieve the outcomes established at the start (delivering the desired impact).
Evaluate at regular intervals
The evaluation stage is the ideal time to identify what is the next key strategic planning cycle to undertake. Once this has been established, you are then ready to embark upon the journey of strategic planning once again.
Two essential skills in evaluation are:
- Assessment and reporting
- Outcome assessment
Good practice guides on the above skills are included in Tools for Tomorrow - a practical guide to strategic planning for voluntary organisations.
Ask questions and learn from the experiences of other organisations in the network forums.