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The performance of every organization is important to their business and stakeholders. Many organizations look for ways or find a key factor that will boost the performance of their business. It is difficult for companies to find what that key performance could be, but when they do it becomes the turning point of the company. The key factor in organizational performance is strategic planning. Strategic planning is when the company develops different ways to improve their business or approach the industry in which they operate with the intention of becoming the best in their business. Strategic planning provides the company with the option to set both their short-term and long-term objectives.
First, strategic planning allows management in defining goals. It is important for every company to define its goals whether it is long-term or short-term. Defining goals also shapes the way employees work. When there is a goal that needs to be achieved, employees will know how to work in order to achieve those goals. This also gives employees motivation and also makes them feel included in the organizational plan. Defining goals also allows the organization to expand in its business and steer towards a progressive direction. Every organization needs to define their goals to become the best in the market and their industry.
Secondly, strategic planning creates innovation in an organization. Innovation is an important aspect of every organization. Innovation allows the company to come up with new products, services or even management style that will steer the company towards achieving their goals. Innovation also allows for specialization in the company. Employees will be put in a department where they will focus on one particular project. Innovation also allows the organization to manage strategies that led to failure. This will let management create new strategies that will support the new innovation. Innovation is not only about come up with a new product or service or how to improve a system of doing things, innovation could also be related to the company’s organizational structure. Innovation shapes the organizational structure of the company. This allows the company to manage its products and services as well as employees. Innovation is important to strategic planning and this is a key factor in the performance of an organization.
Also, strategic planning also provides motivation for employees through compensation. Strategic planning involves creating both short-term and long-term goals. Employees with the help of management will achieve these goals. When an organization creates new goals employees have to be motivated to achieve these goals. The organization should provide compensation to the employees in terms of bonuses, healthcare benefits and other things. Employees feel valued when the organization compensates them for their hard work. Compensations motivates employees to do their best every day to help the organization achieve both its short-term and long-term objective. Also compensations allows employees to be creative and innovative in the work they do. If the work employees do are recognized and appreciated the organizations goals and objectives will be achieved. Also compensation will make employees work hard to exceed expectations in the organization. Compensation are important to the performance of employees which in turns improves the organizations performance.
Finally, strategic management creates organizational culture. Organizational culture is the beliefs, values and behaviors of its employees. Organizational culture is important for employees because it shows how best employees can work in their place of employment. Organizational culture also shows how employees relate to each other in the workplace. Also organizational culture creates an atmosphere where employees will wake up every day to come to work and help the company achieve their goals. Organizational structure is important strategic planning because it is a key factor in organizational performance.
The key factor in organizational performance is strategic planning. Strategic planning helps in defining goals, creating innovation, compensation and culture. Strategic planning provides this to every organization to achieve their goals, both long-term and short-term. Strategic planning is the key factor in organizational performance.
References
Performance Management-The Key to Outperforming Your Competition. (n.d.). Retrieved December 10, 2014, from https://www.successfactors.com/en_us/lp/articles/automate-performance-management.html
Stanleigh, M. (n.d.). 5 Key Factors to Successful Strategic Planning. Retrieved December 10, 2014, from http://www.bia.ca/articles/5-Key-Factors-Successful-Strategic-Planning.htm
