The global business environment is filled with dynamism and change with globalization and technological changes affecting many businesses. Due to these changes, it is necessary that firms establish the best strategies that can sustain their objectives to the future rather than making them quit the market. Following these challenges, firms have increased competitiveness using strategic planning with the management establishing existing business conditions in the business environment that are used to establish the best strategies that can increase competitiveness of the firm after their implementation.
A strategic plan involves various components that are significant to an organization. To begin with, the plan should have a mission and vision statements. These two are critical components since they stipulate the purposes of the firm both in the immediate short period and in the long term. The two components indicate the objectives of the firm. With these components, the firm is able to continuously review them regarding their achievements (Hill & Jones, 2009, p. 68).
Environment Scan: The other component is the scan of the environment that involves the establishment of various challenges existing in the business environment together with the opportunities that a firm can exploit in order to meet its set objectives. Under this component, the firm collects, scrutinizes and provides information related to formulation of strategies from the environment. The scanning of the environment may involve SWOT and PESTEL analyses that analyze both the internal and external environments of the firm. The scrutiny of the environment should be continuous so that a clear picture of the factors affecting the firm both internally and externally can be established and accurate strategies formulated.
Strategy Formulation: This feature of a business plan is significant since it is closely related to the existing challenges and opportunities of the firm. Through this process, the firm decides the best strategy that it can take in order to meet its set objectives and therefore end up attaining its set purpose. The common strategies are corporate, business and functional strategies that have to be incorporated in the business plan.
Strategy Implementation: Under strategic management processes, implementation of a strategy is one of the important steps toward achievement of company goals. As noted by Lawrie (2005, p. 72), formulation of strategies does not stop there. There is need to implement the strategies through stipulated measures in order to attain set goals. As the strategy is put into action, the firm may implement various things such as designing its structure, manufacture and distribution of products, development of the process of decision making and managing human resources among others.
Monitoring and Evaluation: it is another significant step in planning where the implemented strategy has to be monitored to ensure that it is implemented as stipulated in the strategy guidelines. In addition, effective implementation will ensure that set objectives are achieved. As the final step of strategy management, evaluation involves appraising the strategy in terms of internal and external factors that form the root of the strategy. As noted by Hill and Jones (2009, p. 79), through evaluation, a firm ensures that the formulated strategy and its implementation meets the firm’s set objectives. All these steps are conducted in a chronological order to ensure efficiency and attainment of the company’s purposes.
Benefits of Strategic Planning to a Healthcare Organization
According to Lawrie (2005, p. 86), strategic planning is significant to every organization that has a given goal to be achieved. For a health organization, there may be many goals such as ensuring best quality health services, financial sustainability, growth and expansion. A strategic plan will help a health company meet its set objectives by setting up strategies that will help the firm meet its goals. For instance, by examining the external and internal environment, the strategic plan can help the firm formulate and implement a strategy that capitalizes on the firm’s strengths to exploit opportunities while eliminating all threats such as that of competition. The plan can help a healthcare firm to become financial independent, which is characterized by increased quality and profits that may lead to growth and expansion into other markets (Lawrie, 2005, p. 90).
Strategic plan and Financial Performance and Financial Stability
These are vital aspects of a healthcare firm. The strategic plan brings together a team that evaluates all situations affecting the firm both internally and externally and strategies established through brainstorming sessions or other means. The decision making body of the organization is tasked with formulating the right strategies for the firm that is based on existing environmental conditions. Therefore, through a strategic planning management process, the decision making mechanism in the organization is improved with the team being able to evaluate all options while making viable decisions for the firm. The overall financial effect is reflected by minimized expenses and improved profits.
Strategic Planning and Environmental Response
According to Hill and Jones (2009, p. 92), the entire process of planning is based on existing conditions in the business environment, which are defined by both internal and external environments of the firm. These factors indicate strengths, weaknesses and existing opportunities in the environment. These are the basis of formulating strategies. Therefore, the firm responds to the environment by formulating strategies favoring its goals given the current environment. Since the environment keeps changing with time, Lawrie (2005, p. 97) recommends that environment scanning and evaluation of strategies should be a continuous process so that new strategies are formulated over time given the changing environment.
A strategic plan is significant to any organization including a healthcare corporation. The plan can help the organization meet its objectives. The mission and vision of the firm provide the purpose of the firm both in the short period and in the long term period. While a strategic management process ensures that the implemented strategy is in line with the objectives of the firm, continuous evaluation is necessary to ensure that correct strategies are formulated and implemented based on the existing conditions. Effective implementation of the strategic plan is significant to an organization because as the firm meets its objectives, efficiency is created with financial stability being achieved and the decision making process being strengthened over time. In addition, the firm is able to achieve growth and expansion.
Hill, C. & Jones, G. (2009). Strategic Management Theory: An Integrated Approach. Florence, KY: Cengage Learning.
Lawrie, J. (2005).Strategic Planning and Management in Transit Agencies. Washington, DC: Transportation Research Board.