Strategic Planning: What, Why, How, Tools and Templates

Strategic planning maps the actions needed to deliver on long-term strategy. Use proven practices and tools to do it well.

Strategic Planning: What, Why, How, Tools, Templates | Gartner

Key steps in creating a strategic plan that drives business impact

A good strategic plan clearly and simply articulates where your organization is going and how it can get there.

During the strategic planning process, make sure you:

• Diagnose what drives success or failure for your organization
• Properly assess your organization’s capabilities
• Understand the external competitive environment
• Set precise goals and a clear vision for the future
• Clearly articulate the initiatives required to get you there
• Measure progress properly

How to build a strategic plan you will actually use

Strategic plans must tie directly to long-term strategy and specify clear and achievable goals in an easily communicated format. Make sure to use proven tools to get you there.

• Strategic planning basics
• Strategic planning process
• Strategic planning tools

Strategy and strategic plans: How they differ and why it matters

• Strategy defines the long-term direction for the enterprise by describing what success looks like and what needs to be done to achieve that success. 
• Strategic plans cover the midterm horizon and describe how the strategy will be executed by identifying the roadmap of initiatives necessary to deliver the strategy.
• Operational plans define the projects, programs and products required in the short term to deliver the initiatives identified in the strategic plans.

The strategic planning process must cover all three horizons, as they serve different purposes.

Strategy defines the long-term strategic ambition and focus of the enterprise

Strategy defines what the enterprise will do to compete and succeed in its chosen markets or, for the public sector, it describes what the enterprise will do to successfully fulfill its mission. 

In this horizon, the enterprise will also define what functional leaders need to do to contribute to enterprise success. The strategy horizon typically covers a period of three to five years. However, this may be longer for certain sectors or industries.

Strategic plans define how strategy will be realized over the midterm

Strategic plans describe how the enterprise will realize its long-term ambitions. They identify the roadmap of initiatives and portfolio of investments that will be required to achieve the objectives defined in the strategy.

Strategic plans will be created for the key business domains such as IT, marketing and supply chain. For example, the strategic plan for information and technology will define the target architecture needed to deliver the strategic actions defined in the strategy, and the required target IT operating model. It will also identify the roadmap of initiatives and investments that will be required to reach those targets and execute the strategy.

Strategic plans typically cover a period of 12 to 24 months.

Operational plans cover the short-term execution

Operational plans identify the projects, programs and products required to deliver the initiatives identified in the strategic plans. They are focused on the execution of the changes required to realize the enterprise’s strategic ambition. Operational plans are usually closely related to the enterprise’s budget process and are not, therefore, typically affected by the same confusion as strategy and strategic plans.

Operational plans normally cover a period of six to 12 months.

Stay alert to disruption during strategic planning

It’s critical to scan and respond to trends and disruptions that could impact your strategy and strategic plans and change your strategic assumptions. 

Strategic planning cycles should incorporate mechanisms, including scenario planning, to vet assumptions for relevance.

Ignoring or devaluing trends and disruptions can result in you overlooking threats and opportunities that could affect your value proposition and competitive positioning.

The strategic planning process must cover strategy, strategic plans and operational plans

The strategic planning process should cover both strategy and strategic plans — as well as operational plans. 

Two mistakes to avoid:

• Creating long strategy documents that don’t get read or used — and therefore fail to produce the desired value or business outcomes 
• Producing high-level strategy that lacks enough actionable content to drive execution — for example, by including a list of goals with no explanation of how those goals will be achieved or how success will be measured 

One important way to keep strategic planning on track is to provide baseline definitions of terms that are key to the process. This will keep all stakeholders aligned on the core components of strategic plans required to drive business outcomes. 

If strategic planning participants have only a generic understanding of key planning terms, it can be more difficult to collaborate and ultimately develop a clear, cohesive strategic plan.

Ensure stakeholders understand the key components in the strategic planning process

Align on these key terms to minimize confusion in strategic planning and set a baseline for collaboration:

• Mission and vision. Missions and visions are often confused with one another, but they serve different functions for an organization. A mission states an organization’s essence (i.e., “Who are we?”). A vision describes what an organization is working toward (i.e., “Where are we going?”).

• Goals and objectives. Although commonly confused and conflated, goals and objectives serve distinct purposes. Goal statements articulate what the organization aims to achieve, while objectives provide an important roadmap for how they will achieve it.
• Action plans formally document the steps (or initiatives) required to attain an objective. This plan is the primary source of information for how an objective will be executed, sequenced, monitored, controlled and closed.
• Measures and metrics are often treated as interchangeable. While they are related concepts, they are not exactly the same. A measure is the name of an observable business outcome (for example, employee engagement), while a metric describes the actual data being collected to quantify the measure (for example, percentage of “satisfied” employees in an annual survey).

Different stakeholders are required for the different elements of planning: Mission, vision and goals are best set by senior leadership, while objectives, action plans, measures and metrics are best left to managers with execution expertise.

Tools are key when you build and refine your strategic planning documents

Gartner has worked with clients to evaluate hundreds of strategic plans across industries, geographies and strategic contexts. The best plans are driven by information and data surfaced through diagnostics and when final, templatized for easy understanding and sharing. 

These eight activities are especially improved by good tools and templates:

1. Lookback. Organizations that fail to learn from their experience struggle to meaningfully improve their strategic performance. Use performance dashboards to understand the root causes of your successes and failures as an organization and extract and present lessons or imperatives to improve future performance.
2. Internal scan. Companies that don’t assess core capabilities regularly, tend to under- or overestimate their ability to deploy successful strategies. Use tools like Gartner Score to:
   • Review your organization’s capability strengths and gaps
   • Understand which capabilities need to be built to develop a competitive advantage
   • Close any capability gaps and inform future growth bets
3. External scan. Without identifying early signs of threats and opportunities, strategic plans lack impact and expose the organization to the risk of gradually losing its relevance. Use tools like Gartner “Tapestry of Trends” (TPESTRE) to:
   • Review market dynamics and factors that govern the attractiveness of the market
   • Understand the trends among competitors and customers
   • Identify and act on market opportunities and threats
4. Vision. Without a clear vision, strategic goals are imprecise, creating internal conflicts and strategy stalls. Templatize your mission and vision statements to:
   • Articulate an ambitious yet achievable vision statement that motivates employees and facilitates goal development
   • Present a comprehensive view of the end state envisioned for your organization
   • Identify strategic imperatives that must be realized to achieve the desired vision

5. Goals. When goals are unclear, the strategy can be derailed by conflicting actions, confusion and misalignment. Use tools such as business-alignment conversation guides to:
   • Develop high-quality goals that will allow you to act on the imperatives
   • Ensure goals are aligned with the vision, external environment and internal function
   • Develop actionable roadmaps to enable effective execution
6. Initiatives. Poorly articulated initiatives can lead the organization to overinvest in ill-advised ventures or underinvest in prudent ones. Use tools such as decision-maker and portfolio scorecards to:
   • Make an action plan for the organization to succeed in chosen markets
   • Prioritize the key initiatives to achieve the organization’s objectives and goals.
   • Identify and close capacity constraints that can hinder the smooth execution of the strategy
7. Measures. If measures do not directly support strategic goals, managers will make poor decisions during execution that will derail the strategy. Use tools to evaluate, select and track the right metrics to:
   • Improve the rigor and credibility of your metrics
   • Assign accountability for key actions and behaviors
   • Ensure capacity for course correction and timely execution
8. Messaging. If the stated strategy does not engage and inspire the team, it is not the right strategy. Templatize your messaging to:
   • Build a clear communication plan that motivates stakeholders to execute the strategy
   • Ensure the information presented in your strategic plan documents is easily digestible