Strategic Planning There Are Several

Strategic Planning

There are several steps that should be taken to help GIFC ascertain its future strategy. The first step is for the company to set some objectives. In this case, the objectives will be somewhat vague because the company is about to embark on a major strategic shift that will result in new objectives. However, the stakeholders each have personal financial objectives. So the chosen strategy should be able, if successfully executed, to meet those objectives. Specific strategic goals will be devised once the course of action is chosen.

The next step is to consider the resources of the firm. The strategy chosen must fit with the capabilities of GIFC for a couple of key reasons. One is that most of the strategic alternatives presented thus far are outside of GIFC's core business. If they are to enter into a new business, they must have a strong sense of the skills they possess so they can determine what needs to be brought in from the outside. The other is that ideally they would want to leverage the brand and the skills they already have to help the new business succeed. To do this requires understanding of what these strengths are.

They must also analyze their own weaknesses. These provide the constraints that they must either operate under or work around. For example, the company's capital situation prohibits them from pursuing multiple alternatives. All of their weaknesses and potential constraints must be known so that they do not pursue a course of action that they will not be able to execute.

GIFC also needs to examine the external environment. This will give them several important pieces of information. The first is that they can better identify the opportunities that are present in the marketplace. Each of the current alternatives involves entering a one new market or another, be it a new product or a new geographic region. However, not all opportunities are created equal. GIFC needs to examine each opportunity in terms of its potential. They should also go beyond the opportunities presently in front of them and examine the broader market for other possible opportunities.

An analysis of the external environment will also provide GIFC with information about the potential threats they may face. They should perform this analysis not only for their current market but for each of the markets they are potentially going to enter. Knowing the threats the company faces will help to guide their future. This environmental analysis should include all facets of the environment. The competitive intensity of the environment should be analyzed. So should the economic, demographic, technological and financial environments be included in the analysis. Analysis of these environments can help identify market opportunities or help put the focus on the company's core competencies.

All of the above represents the first part of strategic planning. You must know where you are now before you can determine where you should be going. The next step is to analyze the alternatives. It is important to remember that the current list of alternatives is not the sum total of options available. The company should be as creative as possible in the alternative-generating process. The external analysis should help with this by identifying opportunities in the marketplace that may not have been part of the initial idea generation process.

Whatever alternative is chosen, it should be congruous with the company's existing competencies. Ideally, GIFC will have some source of sustainable competitive advantage that can be leveraged in the new business. Even if not, the strategy should play to the company's strengths, but be manageable within the company's constraints. Because this is a small, family-owned firm, GIFC should consider how they will implement each of the strategies that have been shortlisted. The stakeholders should evaluate the time frames for the strategies vs. their own time frames. Some of the strategies can be expected to succeed relatively quickly and easily; others will represent a significant challenge that could take years to succeed.

Once the strategy has been chosen, a more detailed implementation plan can be drawn up. The objectives of the firm must be re-set to reflect the change in direction. Then a power structure must be derived according to the needs of the new organization. From there, an inventory of resources required should be taken, and strategies developed to turn those resources into the firm's new objectives.