The information age coupled with globalization has effectively made management one of the most difficult assignments. Managers in the modern world are compelled to tackle critical matters in order to remain competitive. The question informing the basis of this paper is exactly what is the most critical issue facing management has we open the second decade of the 21st century? This question can be answered in various ways as there is no general consensus in society over the same. It is my contention that the most critical issue today is strategic planning. Strategic planning denotes planning for the immediate and long term realization of goals and objectives of businesses. This duty falls within the mandate of management and arguably remains the most critical management issue.
The reason why strategic planning is a critical management issue can be explained in the fact that it plays an essential role in role in the business set up. First, observers insist that failure to plan means planning to fail. This mantra popular in business circles attest to the crucial role that strategic planning plays. Strategic planning extends this further. It requires of a unit to position itself within the margins of safety while at the same time ensure that business profits are maximized. This calls for the analysis of related risks against expected returns. Business strategists will tell you that this function is not only difficult, but is the fulcrum of failure or success. In fact, strategy determines the trajectory of business. A poor planner would be floored in the industry due to the market surprises. It is illustrative to note that markets today are wrought with uncertainty and instability. The survival of a business, therefore, depends on the robustness of the strategic plan. This perhaps, informs the assertion and argument that strategic planning is the most critical factor in management today.
Management, unfortunately, because, it is my belief that it is unfair, are charged with the responsibility of maintaining the going concern of units. In fact, while shareholders or owners of business units may retain the decision making powers, often, their decisions are merely rubberstamps to advisory opinions of management. Management, consequently exercise their stewardship roles over business concerns through the use of strategy. Strategic planning may help managers manoeuvre through the dynamism of the markets. The business units are able to survive and withstand market shocks due to relevant strategic planning. This illustrates further the critical nature of strategic planning. At times, business units are able to tap into the markets or markets niches because of proper strategies laid out during strategic planning. It is, therefore, operative and realistic to appreciate that strategic planning has a bearing on the future of the business unit, both in the long and short term and that poor planning necessarily leads to poor decision making. This, without an iota of doubt, is the ultimate recipe of failure and loss making.
Strategic planning calls for the realization of the complexity of the markets. Markets are not only dynamic; they are as complex as humanity in this globe. Management must have the ability to predict or at least attempt a forecast of the market performance and occurrences. Without a strategic plan, the managers remain unable to focus and position the management in line with the future and present market conditions. They, then have to employ strategy that would maximize their returns and minimise their costs. This assignment may sound simplistic in paper, but is quite difficult in practise. This is one reason managers of blue chip companies spend sleepless nights. They must be able to predict where the dollars would be concentrated and how their company can tap this precious resource.
Critics may raise contention as to the essence of strategic planning. They may have us believe that management should pay attention to more critical areas such as interpersonal and communication skills, the need to handle the typical resistance to change and the ever occurring changes in technology. It is my contention that though these areas also fall within the precincts of critical managerial issues, they equally resonate around the area of strategic planning. In other words, strategic planning has an inclusionary tendency that these other areas do not necessarily possess. Take, for instance, the case of changing technology. In strategic planning, management would easily observe the fact that their technology being out-dated is the direct or indirect cause of inefficiency. They would correctly strategize for the acquisition of new technology alongside other auxiliary requirements such as training of personnel and marketing of the newly produced products. This approach, from a managerial point of view is broad and avoids the absurdity of narrowly addressing technology to the exclusion of other necessities. Strategic managers opine that strategy is a broad area which intertwines and correlates to all other areas. Strategy indeed collates all spheres and applies a common thread to knit the cloth that we elect to call profitable business units.
Management must be wary of the necessity to have comprehensive strategic plans. They must strive to avoid the embarrassment of losses and set backs at the eleventh hour. The critical place of strategic planning necessitates for management to put in place comprehensive mechanisms and plans for the attainment of goals and objectives prior to the beginning of the operations. It remains for the management to strategically lay out activities that would enable the unit benefit positively. The place of strategic planning can, therefore, not be overlooked in the world of management.
References
Abraham, S. C. (2012). Strategic Planning: A Practical Guide for Competitive Success. New York: Emerald Group Publishing.
Mintzberg, H. (2009). The Fall and Rise of Strategic Planning. Harvard Business Review , 12-23.
Steiner, G. A. (2010). Strategic Planning. New York: Simon and Schuster.
