Strategy and Planning Fundamentals: Empowering You

STRATEGY AND

PLANNING

FUNDAMENTALS

EMPOWERING YOU

Fernando H. Ferrer

Copyright © 2025 Fernando H. Ferrer.

All rights reserved. No part of this book may be used or reproduced by any means, graphic, electronic, or mechanical, including photocopying, recording, taping or by any information storage retrieval system without the written permission of the author except in the case of brief quotations embodied in critical articles and reviews.

Archway Publishing

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Bloomington, IN 47403

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844-669-3957

Because of the dynamic nature of the Internet, any web addresses or links contained in this book may have changed since publication and may no longer be valid. The views expressed in this work are solely those of the author and do not necessarily reflect the views of the publisher, and the publisher hereby disclaims any responsibility for them.

Author photo by Victoria G. Ferrer

Interior graphics created by Fernando H. Ferrer

ISBN: 978-1-6657-7225-9 (sc)

ISBN: 978-1-6657-7237-2 (hc)

ISBN: 978-1-6657-7226-6 (e)

Library of Congress Control Number: 2025902261

Archway Publishing rev. date: 03/27/2025

PREFACE

Strategic planning is a process.

It encompasses analysis, principle-setting, strategy crafting, implementation, and establishing control systems for sustainable development.

Whether you’re an experienced or seasoned leader, a curious professional, an entrepreneur, an advanced student, or someone within an organization seeking to trigger deeper thoughts and actionable knowledge, this book will help you embrace the transformative power of strategic planning. It will elevate your organization to the next level and accelerate your career. This book can be used as an educational and professional development instrument. It guides you through a clear, systematic process to design a future worth striving for, grounded in purpose, built on collaboration, and driven by thoughtful goals, strategies, and planning to unlock potential and drive success.

Every day, you navigate routines or tackle new challenges, often imagining how things could be different. You have ideas, ideas about change, improvement, or creating something new, but they may remain unexplored, slipping into the background as life moves on. What if you give those ideas the attention they deserve?. What if you nurtured them, guided their development, and transformed them into something meaningful?. Something that could create change, improve your life, your organization, benefit others, and positively impact both you and the world around you?.

This book is created to supporting you to take your ideas to the next level. It’s a comprehensive instructional and training tool designed to enhance learning and encourage collaboration in diverse entities and cultures, making it applicable worldwide.

In the organizational and business world, you have likely encountered terms such as strategy, stakeholders, goals, controls, policies, mission, vision, and resources. These words are interconnected, but they can mean different things to different people, leading to misunderstanding. If you can master the process of creating and implementing ideas effectively, you’ll turn thoughts into actionable strategies and plans, and those plans into tangible successes. Strategic planning is at the heart of this process. It’s used by organizations across industries, whether private companies, public institutions, or hybrids. No matter the size, territories or sector of your organization, strategic planning helps you define your raison d’être, set the core principles, determine your direction, allocate resources, generate the financial plans, shape the enterprise framework, and build pathways to growth and success.

This book is your step-by-step guide to developing and deploying the fundamentals of strategy and planning. As you go through the chapters, you’ll see how straightforward and logical the process can be. You’ll uncover the value of strategic planning, understand its essential components, and recognize how it sets successful organizations apart. Whether you’re leading the planning process or playing a supporting role, this book will equip you to contribute meaningfully and reap the benefits of effective strategic planning.

You need the reason and direction to move forward, whether in your personal life or within your organization. Strategic planning gives you both. It presents the concepts for establishing organizational principles, outlines how to identify solutions through strategic paths, and explains how to create conditions for success.

This book compiles decades of knowledge about the diverse elements that form a strategic plan. It draws upon extensive research from foundational academic literature, renowned scholarly articles, and hands-on field experience. As an international business professional and professor specializing in global strategic planning and other business-related topics, I have condensed the essential components of strategic planning into this comprehensive guide. The content is designed to bring clarity to the strategic planning process, making it accessible and valuable for you and every member of your organization, regardless of their role or level of experience.

The chapters ahead are designed to demystify the complexities and misconceptions surrounding strategic planning, breaking it down into manageable steps. Each piece of the puzzle will provide you with tools to understand, create, and implement a strategic plan tailored to your organization’s unique needs. From assessing environments to identifying opportunities, solving problems, defining priorities, and evaluating progress, you’ll master the process of crafting a vision for the future and making it a reality.

Basking Ridge, New Jersey, January 1, 2025

Fernando Hugo Ferrer

INTRODUCTION

Strategy and planning fundamentals is to empowering you. Each chapter of this book outlines the various steps required to help business professionals create a comprehensive strategic plan for their organizations. The content is enriched by real-world experience and references from a hundred academic articles and books. When the chapter covers a topic that requires creation, it includes guidelines to support you in writing the corresponding elements of the strategic plan, along with a Key Terms List at the end of each chapter, which serves as a chapter glossary. The references were included in the body of the book to facilitate access to the references while reading, and while listening to audiobooks. This introduction serves as a quick reference to summarize the detailed insights provided in the chapters, supporting the preparation of the strategic plan without replacing the depth of the full content.

The sequence for elaborating the strategic plan involves registering each step and reviewing it at the end of the process to confirm consistency. Identify your desires or ideas about the outcomes you want to pursue. Gather and analyze information from the key external environments and about your organization. Create the core principles. Define the goal and develop strategies to solve problems, gain access to, and maximize opportunities for your institution. Develop action plans, elaborate on the management execution, and craft financial plans. This process, as outlined, will impact the enterprise framework, meaning that the strategies and action plans may affect governance, structures, the organization, policies, and standard operating procedures, which should be reviewed and updated accordingly. The creation of control systems for the re-evaluation of outcomes occurs in parallel with each step of the process but is completed in the final steps of the strategy to ensure that the relevant elements impacting the strategic plan are included in the control system.

Part I comprises the underpinnings. The Chapter 1 introduces preliminary concepts, such as strategy and planning, to establish a common understanding from the outset. Chapter 2 explores why engaging in the strategic planning process is critical, highlighting its benefits and the potential negative impact of neglecting this process.

Part II is to activate the process. Chapter 3 delves into basic concepts related to start developing the strategy and planning process. Desire is presented as the starting point of the journey, prompting readers to document their initial ideas and aspirations. Whether the desire originates from an individual or a team responsible for the strategic plan, the motivation, willingness, willpower, commitment, and action are emphasized as key elements that will guide the process. This chapter also briefly introduces managing and leading as critical influences on organizational processes. It concludes with practical advice on writing an initial statement of desire, acknowledging that it may evolve during the planning process but serves as an early guiding beacon.

Having laid this foundation, Part III focuses on understanding the scenarios that impact the enterprise and where the firm has influence as well. Chapter 4 transitions to understanding external scenarios. It emphasizes the need to gather and analyze data on six critical environments -political, economic, social, technological, industrial, and natural - referred to by the acronym PESTIN. Beginning with the natural environment due to its significant and overarching impact on the analysis of the other environments. The chapter provides examples of areas to guide the gathering of information and the preparation of the environmental analyses, ensuring a thorough unveiling and understanding of external factors that influence the organization and its industry.

In Chapter 5, the process of analyzing the business itself is introduced. Tools such as SWOT analysis, VRIO frameworks, matrices, and Porter’s Five Forces are presented to support internal assessments and understand competitive forces. Readers are also encouraged to explore other models and theories to enhance their analyses. These steps ensure that the organization’s internal capabilities and external market dynamics are thoroughly evaluated.

The next phase is Part IV that is about setting the foundation for the corporation; and its principles are discussed in Chapter 6. It focuses on establishing the foundational principles of the organization that will guide all aspects of the institution. A broad and deep discussion is presented for the key four elements that integrate the core principles:

•Vision is in the infinite, something to be pursued far away from now.

•Purpose is what matters for everyone and makes a positive impact on the world.

•Mission is the journey and something to be accomplished.

•Values: Ethical standards and cultural principles that guide organizational behavior during the strategic planning process.

The chapter provides insights from academic sources and guidance on crafting and articulating these principles to ensure clarity and alignment.

Part V is about the stewardship and where the book explores the development and execution of strategies and plans. This part begins with Chapter 7, which highlights that by establishing a clear Where To, the organization provides direction and offers a structured framework to create strategies. The chapter explores how goals, when defined as both aspirational and achievable, can integrate elements of personal goal-setting, self-efficacy, self-determination, and performance. Building on research from recognized authors on the characteristics and attributes of people and goals, it demonstrates how well-crafted goals effectively communicate the organization’s intentions to stakeholders, foster unity, rally collective efforts, and guide meaningful progress. The chapter concludes with an exploration of basic concepts related to happiness and satisfaction, along with a practical guideline for writing goals.

Chapter 8 focuses into the process of strategy creation, emphasizing how organizations can navigate challenges and proactively shape their futures. The chapter aims to facilitate the development of a strategy that serves as the cornerstone of the institution’s strategic plan. It incorporates critical concepts and theories to provide a robust theoretical foundation while maintaining practical applicability. The chapter concludes with a comprehensive guideline for crafting a sound and effective strategy, ensuring that organizations are equipped with actionable insights.

Chapter 9 outlines the creation of detailed action plans and emphasizes the importance of proficient execution. It stresses the need for well-structured action plans based on a model presented in the chapter, which advocates accounting for lag theories and managing expectations to reflect the gradual and adaptive process of organizational transformation. Key elements such as forecasting, budgeting, and resource alignment are thoroughly examined, along with the pivotal roles of accelerators, decelerators, and critical success factors in driving progress. The chapter concludes by highlighting the necessity of conducting a comprehensive review of goals, strategies, action plans, forecasts, and budgets to ensure coherence and precision before presenting a final draft to senior management for further revision or approval. The subsequent three chapters will introduce elements that may necessitate adjustments to the final draft prepared at this stage of the strategic planning process.

Part VI is the Enterprise Framework. Chapter 10 addresses governance and risk management. Governance is presented as the framework through which organizations are directed and controlled in alignment with national regulations and corporate principles. Senior management and the Board of Directors (BoD) are tasked with ensuring that the governance structure represents shareholders and protects the organization from fraud and incompetence. The chapter also introduces key risk management principles to safeguard organizational stability.

Chapter 11 explores and distinguishes between various enterprise structures and organizational models that are applicable to implementing the newly created strategy and planning process. It emphasizes the critical role of policies and standard operating procedures in governing the organization and its operations. The chapter underscores how newly established goals, strategies, and action plans may require adjustments in these areas. Depending on the scope of change outlined in the strategic plan, the organization may need to undertake restructuring, implement training programs, enhance communication efforts, recruit new talent, or, in some cases, consider downsizing to ensure alignment with its envisioned future direction. This analysis may lead to a revision of the final draft of the strategies and action plans that were created following the guidance of the previous chapters.

Chapter 12 is in the Part VII and focuses on control and re-evaluation. It introduces the fundamental principles of control, their key elements, and practical applications, supported by a review of classic literature. Control systems are emphasized as essential for monitoring and ensuring the success of the strategic plan. These systems should be developed in parallel with action plans and budgets to secure the necessary resources and tools for effective implementation.

Part VIII is the Appendix which contains the glossary, serving as a quick-reference list of key terms used in the book and organized in alphabetical order.

The comprehensive approach to strategic planning presented in this book is meant to support individuals and organizations in evaluating and navigating the complexities of their external and internal environments, reviewing their core principles, setting clear and achievable goals, and creating and implementing strategies, action plans, financial plans, the enterprise framework, and the evaluation and control systems that drive sustainable success.

CONTENTS

Preface

Introduction

Part I: UNDERPINNINGS

1 Strategy and plan

2 Why?

Part II: ACTIVATE

3 Desire and behavioral factors. Leading and managing

Part III: UNDERSTAND THE SCENARIOS

4 Gather information

5 Analyze the business

Part IV: SETTING THE FOUNDATION

6 Core Principles

Part V: STEWARDSHIP

7 The Goal

8 Create the Strategy

9 Plan, Execution, Forecast, Budget

Part VI: ENTERPRISE FRAMEWORK

10 Governance and Risk

11 Structure, Organization, Policies and Standard Operating Procedures

Part VII: CONTROL

12 Control and Re-Evaluation

Part VIII: APPENDIX

Glossary

To my wife Gabriela,

whose unwavering support, patience, and wisdom have been my constant source of strength and inspiration throughout this journey.

PART I

UNDERPINNINGS

CHAPTER ONE

STRATEGY AND PLAN

The term strategy resonates as a pivotal force shaping the destiny of organizations. Far beyond the confines of routine planning, strategy encapsulates a rich and multifaceted landscape that demands nuanced exploration.

This chapter is to present two key concepts of this book; either because of the title itself or because, at this point, you may feel more comfortable if we first discuss what strategy and planning are.

Let’s begin with definitions to establish a common understanding upon which we can build our discussion.

STRATEGY

What is strategy?

Strategy is both a decision, and a decision-making framework that guides individuals and directs the organization toward its desired future. It provides guidance for aligning actions and efforts to achieve meaningful outcomes.

It is the organizational instrument that orchestrates collective efforts toward a common destination.

Strategy is not the same as a detailed plan.

What is the strategy for?

Strategy is about solving problems.

Strategy provides clear direction for the organization, outlining what to prioritize and focus on to achieve established goals and shape the desired future.

This alignment empowers individuals within the organization to find meaning and direction, clearly understanding where to channel their efforts to make meaningful contributions toward the overarching goal.

It creates a common language and fosters a sense of collective ownership and commitment that resonates at every level and across all functions of the institution, impacting its stakeholders.

How do you create a good strategy?

The strategy is the result of following a systematic process of gathering, collecting, analyzing, and interpreting relevant information from the environments where the organization acts and impacts; then combine them with the corporate principles to be able to define the goal on which the actionable strategies will be created.

Simple in approach, yet profound in impact, the strategic journey unfolds as a narrative where the members of the organization shape the future.

What should the strategy do?

The strategy must serve to provide growth and create value for the organization and all its stakeholders, at the time that is aligned and supporting the core principles.

Strategies in business are to create value.

Strategies are a guide for what to do to achieve the goal.

At its core, a well-crafted strategy is more than a directional guide; it is a dynamic framework that propels the organization toward its defined goal while simultaneously cultivating an environment where value creation becomes inherent. In essence, the strategy is the catalyst that propels an organization towards a future where sustained growth and value generation are not only aspirations but the tangible outcomes of strategic intent.

The challenge of organizations is to craft strategies that not only respond to current market conditions but also anticipate and shape the future.

Embedded within the fabric of strategy is the art of envisioning the future. The strategic planning process involves setting long-term goals that serve as beacons, guiding organizational strategies, actions, and investments.

A strategic blueprint provides direction and focus, while action plans act as milestones along the journey.

Strategy, in its profound simplicity, ensures that organizational decisions are not merely reactive but grounded in a deliberate and intentional framework.

PLAN

What is a plan?

A plan is a detailed program and schedule outlining what must be done to implement the specific strategy it supports.

Meticulously crafted, it ensures that each action is aligned with the strategy and provides a clear roadmap from concept to reality.

A plan is an agenda and timeline that guides the execution of the overarching strategy, carefully designed to optimize resources and drive success.

What is the plan for?

It transforms strategic aspirations into tangible steps that individuals at all levels can understand and execute. The plan becomes the vehicle through which strategies are translated into concrete, measurable activities.

The plan serves as a comprehensive guide for organizational success. The plan is for people to operationalize the actions to comply with the strategy in an orderly, systematic, and measurable way.

How do you create a good plan?

To create a good plan, you must first understand what the strategies aim to achieve. Then, define the actions, responsibilities, resources, timeframe, expected results, impact, and performance indicators needed to implement each strategy. A plan consists of one or more actions designed to execute each strategy, as some strategies may require multiple actions. The plan must be clearly written, providing all the necessary information for those responsible for its implementation to carry it out effectively.

Each strategy should be broken down into actionable steps, clearly outlining who is responsible for each task and what resources are required. This detailed delineation fosters accountability and ensures that organizational efforts are directed purposefully toward the strategies and goals.

A hallmark of a good plan is clarity in communication. The plan should be written with precision, ensuring that those responsible for implementation have a comprehensive understanding of their roles and the overall strategic landscape. Clarity mitigates ambiguity, reducing the likelihood of misinterpretation and enhancing the likelihood of successful execution.

What should the plan do?

A good plan should provide operational clarity, allocate and optimize resources, embrace adaptability, and include key elements to design monitoring, assessment, and robust control systems.

It outlines the steps to be taken, assigns responsibilities, establishes timelines, and presents clear, unambiguous information about what the strategies aim to achieve. This ensures that those responsible for implementation know exactly how to proceed.

The plan should also guide the organization’s members in maximizing impact while addressing potential constraints. If there is any doubt about what the plan requires, review the strategy to ensure the plan aligns with it.

How do the strategy and the plan work?

The strategy outlines the most essential options and decisions but is not a detailed or complete plan of action. Strategy is about creating a situation in the future, the plan is the means of implementation and, therefore, within your control. The plan is how you will shape the future—it defines how you are going to execute your strategy and make it happen.

Let’s clarify these two words: strategy and plan. They are essential to begin our discussion and delve into the topic, but they are far from representing the entirety of this critical organizational activity.

The core principles, goals, and strategy serve as the guiding framework for a strategic plan. As we move forward, we’ll explore how to establish the key elements necessary for effective strategy implementation. This includes understanding the scenarios, setting the core principles, developing and implementing direction, allocating resources, creating the financial plan, establishing the enterprise framework, and incorporating control and reevaluation mechanisms. These elements form the foundation for creating and executing a strategic plan that can be applied to any organization. Each of these components will be addressed in detail in the upcoming chapters of this book.

Strategy reflects your choices and decisions, while the plan outlines how you will execute them. It is common for people to use strategy, plans, and tactics interchangeably, but as this chapter demonstrates, doing so is incorrect and can lead to confusion.

Every organization must evolve in a manner that generates positive outcomes, achieving results that surpass the cumulative value of the resources employed.

Perhaps the most intricate facet of strategy lies in its holistic integration across organizational functions. It is not the exclusive domain of top executives; rather, it permeates every layer and department. Effective strategy requires alignment from the entire organization, weaving a cohesive narrative that unites disparate elements toward common goals. Strategy becomes the thread stitching together the organizational fabric.

At its core, strategy is central to the organization’s functioning. It represents a dynamic and systematic process that aligns the organization’s resources and capabilities with the constantly evolving external environment. Strategy goes beyond routine decision-making, evolving into a deliberate framework that integrates foresight, planning, and execution. To understand strategy is to recognize its critical role in guiding the organization, ensuring that all elements work together toward the achievement of long-term success.

Strategic management offers organizations a clear direction and serves as a critical operational tool, developed through a systematic process of analysis. This process involves understanding the environments and the organization itself, establishing