The Strategic Planning Concept in Strategic Management Hernan E.

Contreras Alday * Summary This text aims to highlight the importance of strategic planning in managing org anizations within the concept of Strategic Management. Presents the main steps f or deploying the process of strategic management and seeks to clarify key aspect s of the relationship of the concepts of strategic vision and managing the deplo yment of strategic planning as well as highlight some current views of how they should be treated the planning for the present and planning for the future. Keyw ords: planning, strategic management, business strategy, environment. Abstract This article stresses the Importance of Strategic Planning When managing Busines s Organizations, Within the concept of Strategic Management. It presents the mai n steps When implanting the process of Strategic Management and the Clarifier As pects related to the fundamental concepts of Strategic view and management in th e Implementation of Strategic Management. It Also emphasizing focus on some curr ent views on the present and is planning for the future. Key words: planning, Strategic Management, business organization, Strategic view . * Mechanical Engineer, Master in Business Administration and Business Management by ESADE, Barcelona - Spain. Professor of the disciplines of Strategic Planning and Administration in Marketing in the SAF, a tenured professor of CDE projects in the SAF. E-mail: alday@cwb.matrix.com.br 9 Rev. FAE, Curitiba, v.3, n.2, p.9-16, May / Aug. 2000 Introduction Much is made in Strategic Planning (EP), and organizations in general can still find a range of interpretations regarding this administration tool. The Strategi c Plan, which became the focus of attention of top management of companies, turn s to the positive steps that a company can take to address threats and seize the opportunities found in their environment. Companies of all kinds are coming to the conclusion that systematic attention to this strategy is a very profitable a ctivity. Small, medium and large distributors and manufacturers, banks and witho ut purpose of profit, all types of organizations must decide the directions that are more tailored to your interests. The reasons for this increasing attention to business strategy are many, some more obvious than others. Among the most imp ortant causes of the recent growth of Strategic Planning, we can mention that th e environments of virtually all businesses change with amazing rapidity. These c hanges occur in economic environments, social, technological and political. The company can only grow and progress to achieve ajustarse to the situation, and St rategic Planning is a proven technique for such adjustments are made with intell igence. This is a more flexible instrument known as the Long Term Planning. A ke y element of the strategy is the selection of only a few features to be consider ed and measures taken. It is a tool that forces, or at least encourages, the adm inistrators to think in terms of what is important or fairly important, and also to focus on issues of relevance. The most important use of the Strategic Plan i s its close link with strategic management in organizations. You can not treat s eparately the strategic planning process without entering into strategic, thus c ontributing more effectively to the management of managers in achieving their re sults. 10 What is Strategic Planning? With the constant change of economic scenarios in the world, including Brazil, t

here are some negative factors about which should focus the attention of adminis trators. Issues such as low economic growth, globalization, government regulatio n, inflation, shortages of certain resources, high cost of oil and protectionism should alert international organizations to use and further development of such planning. In Brazil, although many companies are already using the methodology of Strategic Planning, although there are doubts about what this really comes in to being and how it should be formulated. The bigger question concerns a marked tendency to use the term "Strategic Planning" and "Long Term Planning" as if the y were synonyms. According to Igor Ansoff (1990), only a few companies use the r eal strategic planning. The vast majority of organizations still using the outda ted techniques of long-term planning, which are based on extrapolation of past s ituations.€The methodology of long-term planning was developed in America in the 50s, with profound influence of technology planning in countries with centrally planned economy in the long term. As a result, according to Marvin BOWER (1966) , the long-term plans have become profit projections (for ten years or more) wit hout much utility, represented by a huge amount of paper and a limited amount of strategic thinking. Such plans do not allow to predict the environmental future . In the mid-60s, was introduced Strategic Planning propositions by prof. Igor A nsoff, from researchers at Stanford Research Institute and the consultants from McKinsey Consulting Co. (Taylor, 1975). Philip Kotler (1975), one of the advocat es of its use, propose the following concept: "The Strategic Planning is a metho dology management that allows for direction to be followed by the Organization, which h as a greater degree of interaction with the environment. " The board includes th e following items: scope of action, macro, functional policies, philosophy of ac tion, macro strategic, functional strategies, macroobjetivos, functional objecti ves. The degree of interaction between an organization and environment, which ca n be positive, neutral or negative, varies depending on the assumed strategic be havior by the organization before the environmental context. The table below ill ustrates the optional behaviors of an organization and its consequences. Myths and Misconceptions about Strategic Planning in the business world, most of the conventional thinking on strategic planning, ie, setting goals and formulat ing plans to achieve them, is misguided and sometimes obsolete. Many organizatio ns lose too much time and precious intellectual energy trying to plan and make a prognosis for its future. Create strategic plans grand, supported by detailed b udgets, resource estimates, tactical plans and schedules, but most of these effo rts have little connection to business success. OPTIONAL BEHAVIORS AND THEIR CONSEQUENCES NEGATIVE DEGREES OF INTERACTION BEHAVI OR reagent Not Not Not innovative adaptive Reagent CONSEQUENCES Adaptive short-t erm survival Long-Term Survival Extinction Stagnation Reagent Adaptive Innovativ e Long-Term Survival Development (Dinosaur) NEUTRAL (Chameleon) POSITIVE (Homo sapiens) SOURCE: VASCONCELLOS (1979) There are doubts also about the differences between Strategic Plans, Tactical an d Operational. Russell Ackoff (1966) states that the Strategic Plan is relevant to the organization as a whole, while the tactical plan are related to various a reas of the organization. For example, a Financial Plan and Marketing Plan is a tactical plan. To operationalize the Tactical Plans, Operational Plans are prepa red, to guide resource allocation for each part of the tactical plan. Many organizational leaders tend to confuse with budget planning. In state insti tutions, for example, where budgets are almost entirely directed towards the cos

ts of payroll, the leader goes beyond simply the cost of the current year for th e next year, with corrections for adjustments in wages and cost factors related to of life. All of them make up their budgets properly, with minimal change, and the process goes from one year to another. This type of activity-based budget d eceives the people, leading them to 11 Rev. FAE, Curitiba, v.3, n.2, p.9-16, May / Aug. 2000 think they are planning, but in fact there is often little or no planning (ALBRE CHT, 1994). Planning the Future Projection Is there a better way of thinking in the future. I need to change the vocabulary we use to think and talk about how to orient our business. Planning is the appr opriate word to design a set of actions to achieve a clearly defined result when you have full assurance of situation in which the action takes place and almost absolute control of the factors that ensure success in achieving results. We ne ed a plan to build a bridge, fly a plane, a kidney transplant, open a new office in another city or to launch a new product. But if anyone wants to venture in a competitive market, or pass the national market to a global market, or defend t heir core business (core business) in the face of changing competitive and techn ological expressive, we need something more than planning. This involves a proce ss of reasoning that is exploitative, and non-deterministic. ALBRECHT (1994) cal ls for future projection.€Planning as is done conventionally has little to offer in any situation is highly ambiguous. Documents drawn up, the forecast, the act ion plans and schedules often are nothing more than intellectual mirage. In some cases, the illusion of accuracy that they create can lead to a shift of focus o n means to achieve success. They may mistakenly directing its attention, making it follow the plans in place to exploit opportunities, of which most certainly d oes not contain plans. In one approach, the projection of future outcome measure s are needed or critical indicators that help measure the effectiveness of strat egies. But we can not delude ourselves, thinking we have a realistic set of goal s and we'll be working for atingilas. Rather, we are developing 12 action strategies to explore what is happening in the environment and using the critical indicators to then decide what to do. The concern at that time, should not focus on the expectation of success or failure, because we will be continual ly adapting to the consequences of our action strategies. It seems a subtle dist inction, but may be profound in its effects on thinking processes present there. From this viewpoint, the typical annual planning cycle that many organizations follow religiously can actually catch them the agility to react to changes, thre ats and opportunities. Drafting the strategic plan and annual budget is a proces s so thorough that no one wants to change it, even major environmental changes t hat occur during the year. It takes as much planning as designing the future to make a company successful. Skilled individuals are needed in both tasks. It requ ires leaders who can master both practices. While designing the future is a proc ess that involves deciding how to act based on what is happening in the immediat e environment and in the near future plan is to translate that decision into man ageable actions. The impossibility of making a plan for a future which appears c onfused and ambiguous should not generate feelings of frustration and impotence. It should, rather, develop skills and discipline to continually interpret this in terms of future actions and strategic initiatives, and so use the skills of p lanning to achieve coherent plans. One can summarize the guidelines followed in planning and projection of the future as follows: NO PROJECTION IN PLANNING THE FUTURE -

Set results or goals. Determine actions. Reserve resources. Targeting the target s set. - Mastering the "shock waves" (ALBRECHET, 1994). - Explore trends. - Manage even ts. - Monitor the critical indicators. The future projection and planning should meet at the point where it is possible to devise an action strategy and translate it into a goal or target. In this se nse, planning becomes the result of tactical projection of the future, but do no t expect him to solve the puzzle for the business, this is a dynamic puzzle wher e the pieces are fitted to each day, each months and years, not assembled all at once, in drafting the so-called plan. The guiding premise for this maneuver is the creative Strategic Management. With a clear understanding of who the company really is, its capacity, what is your business that creates value for customers and how it differs to win customers and Mantel, has the means to make the most of the work no matter what the present business environment. The Concept of Strategic Management The study of Strategic Management had its definite form for the first time after the Ford Foundation and Carnegie Corporation sponsor in 50 years, research in t he curriculum of business schools. A summary of this research, called GordonHowe ll report, recommended that the teaching of business had a broader nature and in clude a training course in an area called business policy (Gordon, and HOWELL, 1 959). Such a course should have very different characteristics. Instead of prese nting students to analyze business problems in specific areas such as marketing or finance, emphasize the development of knowledge in identifying, analyzing and solving real world problems in extensive and important business areas. So, woul d give students the opportunity to exercise qualities of trial that are not expl icitly required in any other way. The report also recommended that the new cours e of policy should concentrate on integrating the knowledge already acquired in other courses and promote the development of skills of students using that knowl edge. The Gordon-Howell report got wide acceptance. By the age of 70 years, the course was part of the curriculum of many business schools. However, over time, the in itial focus of the course was expanded, including consideration of the overall o rganization and its environment. For example, social responsibility and ethics a s well as the potential impact of political, legislative and economic on the suc cessful operation of an organization have become topics of interest. This emphas is on more recent and wide area and caused the leaders to change the name of the Business Policy Course for Strategic Management (LEONTIADES, 1982). The concept of strategic management has evolved and will continue to evolve (GINTIS and WHI TE, 1982). As a result, is perceived to lack of consensus on the precise meaning of the term (ANSOFF, 1993). Despite the stalemate, strategic management is perf ormed in many organizations today, and many of them benefit significantly. The S trategic Management is defined as a continuous and iterative process that seeks to maintain an organization as a whole properly integrated into your environment . In the past, the process of strategic management was influenced largely by the planning department of the organizations. The members of these departments were involved in the design and implementation of strategic management systems withi n their organizations. However, more recently, planning departments have lost so me of its influence (SURE, 1993). The current process of strategic management tr ends, especially in smaller organizations, to be dominated by the chief executiv e officer (CEO) of the company. The president is also regarded primarily as the main responsible for the success of the process. That does not mean, however, th at the president follow the process of strategic management independently. Inste ad, the CEO to successfully in this area generally outlines a process of strateg ic management that involves members from different areas and different levels of the organization. 13

Rev. FAE, Curitiba, v.3, n.2, p.9-16, May / Aug. 2000 An organization can obtain many benefits from properly practicing strategic mana gement. Perhaps most important is the tendency of such organizations to increase their profit levels. Although previous studies have concluded that the increase in profitability does not normally monitor the implementation of strategic mana gement, 1 a number of significant recent research suggests that an efficient and effective system of strategic management can increase profitability. organizational or determining the organization's goal. There are two main indica tors of the direction to which an organization is taken: the mission and organiz ational objectives. The organizational mission is the purpose of an organization or the reason for their existence. The goals are the goals of organizations. Th ere are two other indicators of the direction that companies are now in place: t he vision, which is what companies aspire to be or become, and the values that e xpress the philosophy that guides the company and that differentiates it from ot hers. Step 3 - Formulation of an organizational strategy The third step of the p rocess is the formulation of strategy. This is defined as a course of action wit h a view to ensuring that the organization achieves its goals. Formulate strateg ies is to design and select strategies that lead to the achievement of organizat ional objectives. The central focus is on how to deal satisfactorily with the co mpetition. Once the environment has been reviewed and the guidelines stipulated organizational, management is able to outline alternative courses of action in a n effort known to ensure the success of the organization. Step 4 - Implementatio n of organizational strategy in this fourth stage put into action the strategies developed logically emerged from previous stages in the process of strategic ma nagement. Without effective implementation of the strategy, organizations are un able to obtain the benefits of conducting an organizational analysis, the establ ishment of an organizational guidelines and formulation of organizational strate gy. The Strategic Management Process The Strategic Management involves a process or series of steps. The basic steps include: Step 1 - Implementation of an environmental analysis of the strategic m anagement process starts with the analysis of the environment, ie the process of monitoring the organizational environment to identify risks and opportunities p resent and future. In this context, the organizational environment contains all the factors, both internal and external to the organization€that can influence t he progress achieved through the realization of organizational goals. Administra tors must understand the purpose of the analysis of the environment, recognize t he various organizational levels in the environment and understand the recommend ations of standards to perform an analysis of the environment. Step 2-Establishi ng an organizational guideline The second stage of strategic management is the e stablishment of the guideline As a first example of such studies see: Fulmer, R.; RUE, L. The practice and pro fitability of long-range planning. Managerial Planning, v.22 p.1, 1974 and ROBIS ON JR., Richard. The important of outsiders in small firm Strategic Planning. Ac ademy of Management Journal, v.25, n.1, p.80, Mar. 1982. 14 Step 5 Strategic control Strategic control is a special kind of organizational control that focuses on mo nitoring and evaluating the process of strategic management in order to improve it and ensure proper operation.

Special Issues in Strategic Management Two other issues have received particular attention in recent years and administ rators should consider them carefully to determine how strategic management shou ld be practiced within a particular organization. It's international operations and social responsibility. During recent years, businesses have tended to become involved with international activities. As expected this trend to continue, mor e and more organizations will need to consider international issues in the futur e as part of its strategic management process. Social responsibility, in turn, i s an administrative obligation to take actions that protect and promote the orga nization's interests and welfare of society as a whole. Recognizing that such ob ligations exist necessarily have an impact on the process of strategic managemen t. Conclusion In this paper, we tried to highlight the importance of strategic planning within the process of strategic management, placing it as a useful tool for the manage ment of organizations. Were described some important concepts on strategic manag ement, vision and strategic management that can greatly contribute to the reflec tion of directors, and that are directly related to the Strategic Planning proce ss. The Strategic Planning, rather than a static document, should be viewed as a dynamic instrument of management which contains decisions on the anticipated li ne of action to be followed by the organization in accomplishing its mission. It should bring the thought of Professor. Derek F. Abell, the International Inst itute for Management Development (IMD) in Lausanne, Switzerland. In one of his a rticles, entitled "Double-Planning" (1990), he recalls that until recently most organizations could manage and change their business using a single strategy. Si nce the competition was stable and moderate change, this approach was appropriat e. And, in fact, was used by most companies during the long period of expansion that lasted from the end of World War II until the early '70s. But, as the inten sified competition for markets and the change spread, a single strategy, encompa ssing the present and future, offered no basis for a more effective corporate go vernance in the present, much less to manage change. Many companies have continu ed to develop systems of strategic planning without making any distinction betwe en present and future. In fact, they often adopt ineffective approaches that ser ve as "transitional shelter" between the two and fail to meet the needs of excel lence in short-term and long-term change. The ubiquitous three-year plan general ly fall into that trap. The ability of companies today have an effective perform ance depends on decisions made in the past, the decisions they make today to fol low this direction or that shape their choices in the future. It is worth mentio ning an old saying: "The past is the present, and this contains the future." The proposal of Professor. Derek F. Abell is the adoption of dual planning. The fun damental difference between planning for the present ("today for today") and pla nning for the future ("overnight") does not match the common difference between short and long term, in which the short-term plan is merely a mere exercise deta iled budget and operations done in the context of a market position expected for the long term. The planning for this requires its own strategy - a vision of ho w the company needs to work today (given their skills and their target markets) and the role of each function key.€And planning for the future is based on a vis ion of the future - and, more importantly, in a strategy to get there. 15 Rev. FAE, Curitiba, v.3, n.2, p.9-16, May / Aug. 2000 References Ackoff, R. L. The meaning of Strategic Planning. MicKinsey Quaterly, p.48-61, Su mmer 1966. Albrecht, Karl. Programming the future. São Paulo: Makron Books, 1994 . ANSOFF, H. Igor. Strategic planning to strategic management. São Paulo: Atlas, 1990. ANSOFF, H. Igor. Deploying strategic management. São Paulo: Atlas, 1993.

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