A Really Helpful Strategic Planning Example

Ted is a Founder and Managing Partner of ClearPoint Strategy and leads the sales and marketing teams.

Read this step-by-step break down of a fictitious strategic plan example.

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If you’re still feeling a bit murky on strategic planning, here’s how to launch a sample strategic plan step by step. Meet Upward Airlines, our fictitious company that’s about to launch its strategic planning process.

Upward Airlines Strategic Plan Example

Let’s imagine Upward Airlines has a 2017-2022 strategic plan that’s coming to a close. Now’s the time to create a new strategy for 2023-2028. The airline’s strategic plan needs to include goals and the general plan of action on how to achieve them. Think of a strategic plan like a flight plan. Just like an airline has a final destination, like Hong Kong, and predetermined routes to get there, including departure times, direction, connecting airports, etc. Your business has the same kind of plan for its future growth.

But for Upward Air, it takes more than just one flight to get where the company wants to go. The strategic plan is a five-year outlook on its operations, fleet, pilots, customers, and more. The airline can’t simply take the old plan and change the dates—it needs to complete the full planning process, which includes two phases: 1) an assessment of the company’s current situation in preparation for plotting a new strategy, and 2) the implementation of a strategic planning framework that will guide the plan’s management and execution. (Upward Air would also benefit from strategy software to help with execution—more on that below!)

Let’s take a look at both these phases in a bit more detail.

Phase 1: First, prepare for a new strategy.

A company’s mission and vision determine in large part the direction it is headed, but there are numerous ways to get where you want to go. Upward Airlines needs to develop a strategic plan that has the best chance of success given the company’s current strengths and weaknesses and external factors that could impact its course of action.

So before diving into plan-building, Upward Airlines will assess the relevant situational aspects using one or more of the analysis frameworks below.

Environmental Scan

An environmental scan is the process of collecting, analyzing, and interpreting data about a company’s external opportunities and threats. These range from political and economic factors to competitor developments. One of the most popular methods used to perform an environmental scan is the PESTEL analysis.

When Upward Airlines conducted its environmental scan in this imaginary strategic plan outline, it found several things to inform its 2023-2028 strategy:

• Several new low-cost airlines have emerged and increased competition for routes to major cities.
• Bigger, established airlines have added perks like free WiFi and additional seat upgrades.
• Pricing for flights has changed dramatically across the industry in the past five years.
• Upward Air has saturated its current geographic footprint since its last plan.

SWOT Analysis

Using the data from the environmental scan, Upward Airlines next performs a SWOT (strengths, weaknesses, opportunities, and threats) analysis. This high-level analysis helps organizations identify where they’re leading and where they’re lagging, so they can shape their strategic goals accordingly. Upward Air’s SWOT analysis revealed:

• Strengths—A consistent marketing message about no charges for checked luggage and a standardized in-flight experience.
• Weaknesses—An aging fleet that was falling behind on technology.
• Opportunities—Allow people to bring their own devices (no programming overhead), and possibly modernize the fleet with new seats that allow for more people on the same planes.
• Threats—Competitors have copied the low-cost marketing message but added last-minute, hidden costs and confused the market.

Other Analysis Frameworks

SWOT and PESTEL are the most common ways to assess the internal and external landscape, but there are other approaches you can also take to help you better understand your company and identify the right path forward. These include:

• The Blue Ocean Strategy
• The Valuable, Rare, Inimitable, and Organized (VRIO) Framework
• The McKinsey 7S Framework

Your Take: Preferred Methods To Prepare For A New Strategy

We asked for feedback from the business community about which frameworks they prefer for strategic planning analysis, and here’s what they said:

"By examining your organization's strengths, weaknesses, opportunities, and threats (SWOT) you examine the internal and external fields of view. One can build in feedback from other frameworks such as PESTLE, but stay focused on the items that are going to make the biggest impact for your organization and your aims, today and in the future."
—Catrina Clulow of Cut Through Marketing

"I think the best strategic planning framework is the SWOT analysis. It considers internal and external factors—both critical when making decisions about strategy. Additionally, it forces you to think about both positive and negative aspects of a situation, which can help you develop a more well-rounded and comprehensive strategy."
—Kate Zhang of Katebackdrop

"SWOT helps companies identify their weaknesses and strengths. That’s why it’s popular among businesses, as it helps them cut back on costs and create a unique demand for products/services."
—Dan Shepherd of VEI Communications

"The 7S Framework analyzes an organization’s effectiveness based on seven key factors: strategy, structure, systems, shared values, style, staff, and skills. By looking at these factors, you can get a good overview of where your company is today and what needs to be done in order to reach the next level."
—Erik Pham of Health Canal

"The McKinsey 7S Framework is based on the idea that, for an organization to succeed, seven internal organizational components must be in balance. These factors are separated into ‘hard components,’ which are simple to identify and have an impact, and ‘soft elements,’ which are more complex to define and affect. The model's layout is meant to assist businesses in determining which components you need to modify in order to reach/maintain alignment or reach a higher level of performance.
In my opinion, the 7S Model is the best option for businesses looking to compare their current state to their desired state; change their organizational structure or align with a chosen strategy; or model the implications of future organizational changes. Our experience at Restoration1 has shown that the 7S Framework is useful for comprehending the organizational implications and resource requirements required to carry out a strategic plan; but it is not very effective when it comes to assisting organizations with the execution and communication of their plans."
—Steve Elliott of Restoration1

"The Blue Ocean strategy aims to create ‘uncontested market space’ or a new market altogether. This is done by creating products or services that are unique and meet the needs of a specific target market. You want to be the only game in town when it comes to your product or service."
—Loran Marmes of Medicare Solutions Team

"For our high-level objectives, a PEST analysis is key because we want to make sure we’re being active and intentional when it comes to our company-wide, long-term goals. There’s little scope for us to control socio-political context, so we make use of a PEST analysis to stay plugged into the wider discourse, and ensure we act quickly and responsively to the shifting contexts of tech and business landscapes."
—James Lloyd-Townshend, CEO and Chairman of Frank Recruitment Group

"A company needs to be able to address matters on its product value, rarity, and imitability (VRIO). This will help it maneuver any future occurrences as an organization and use the circumstances to its advantage for productivity, growth, and profitability."
—Steve Hruby, D.C. of Superhumn

Using the results of the environmental scan, SWOT, or other methodology, the final piece of the preparation phase is to identify key changes your organization needs to make, which can then be plotted out on a shift slide.

A shift slide defines a spectrum of where a company sits for a strategic area and how it can “shift” along that spectrum to reach where it actually needs to be. (If you need to take a step back and reevaluate your goals prior to plotting them on a spectrum, here are examples of strategic planning goals and objectives.) Sometimes shift slides involve big changes, such as modernizing an aircraft fleet, and sometimes it’s simply a change in brand positioning.

Continuing with our strategic plan example, Upward Airlines decided it needed a customer perception shift slide to evolve the way flyers saw its brand. Its spectrum was to move from being thought of as a “no-frills airline” to “freedom in the skies.” A marketing shift was also needed, positioning Upward Airlines as “one cost,” instead of just “low cost,” and focusing on standardizing expectations for customers.

Phase 2: Implement a strategic planning framework to guide the plan’s management and execution.

Once you’ve identified a path forward, you’ll need a framework in place to help carry it out. (This is a necessity, because strategy execution is a lot more challenging than it might seem.) Similar to the first phase, there are multiple frameworks for organizations to choose from. There’s no “right” one—only the one that best matches your company’s way of doing things, or perhaps reflects a change you’d like to make with regard to improving strategy execution.

Also, keep in mind that you can combine strategic planning frameworks. Some organizations use elements of two or more frameworks to create a custom approach. Great! Every organization manages differently; your planning model should reflect your approach.

Below is a roundup of some commonly used strategic management frameworks.

Balanced Scorecard

A Balanced Scorecard (BSC) forces you to take a balanced view of strategy because it incorporates four different perspectives: financial, customer, internal processes, and learning and growth. It also helps you achieve high-level goals (objectives) through its structure, which uses measures (key metrics) and initiatives (projects) to align business actions with goals. The Balanced Scorecard remains a popular choice since its inception in the early 1990s. You can read more about it here.

Below is Upward Airlines’ Balanced Scorecard as it would appear in ClearPoint strategy software, showing three categories and their associated objectives, measures, and initiatives.

Strategy Mapping

Associated with the Balanced Scorecard framework, a strategy map is a visual representation of the four perspectives. Creating one is beneficial because it forces you to think through what you’re trying to accomplish and how you’ll get there. It also serves as an excellent way of communicating your strategy to employees.

Upward Airlines’ strategy map showed some of the key learnings:

• Setting new financial goals with a differentiated model based on very low ticket prices
• Making low prices possible with a low-frills experience and high utilization of their standard fleet
• Improving operational efficiency by accelerating ground turnaround and focusing on direct routes
• Investing in personnel through higher compensation and flexible union contracts

Objectives & Key Results (OKRs)

The OKR framework is a simple way to set, track, and measure goals on a repetitive (usually quarterly) basis. Everyone knows their direction and aim, and works at a fast, consistent pace to get there. In short, objectives are what you want to accomplish; key results define how you’ll get them done. Key results are aggressive but always measurable, time-bound, and limited in number.

Hoshin Planning

The Hoshin Planning approach aligns strategic goals with projects and tasks to ensure that efforts are coordinated. This strategic management model is less focused on measures and more on goals and initiatives.

Strategic Horizons

This McKinsey framework requires the categorization of growth goals into three different “time horizons”:

• Core business—focuses on immediate revenue-making activities
• Emerging opportunities—focuses on extending existing activities into new areas
• Blue sky—focuses on taking your business in new directions

The idea is that in order to grow, organizations must allocate their resources across all three horizons, a scenario that allows you to maintain your core business while continuously striving to innovate.

This is by no means a complete list of strategic management frameworks; you can read about even more here. It’s also important to realize that you may change frameworks as your business grows.

Your Take: Preferred Strategy Management Frameworks

Below are some of the business community’s thoughts around these frameworks and their advantages:

"The Balanced Scorecard is the best strategic planning framework because it takes a more holistic approach instead of just focusing on one business aspect. I can focus on my customers, finances, internal process, and company culture, helping me track the company’s progress and achieve goals."
—Simon Bacher of Simya Solutions

"I favor strategy mapping because it provides a great visual representation of how effective your company is at creating value. I am a former baseball player so I connect really well with how strategy mapping fits within our dashboards."
—Viktor Holas of Wise Barber

"Strategy mapping allows employees to see how their jobs affect the company's strategic objectives. It helps workers align quickly with the company system."
—Brandon Walsh of Interly

"Strategy mapping is the best strategic planning framework because it helps visualize the relationship between an organization's strategic goals and the specific tactics or initiatives that will be used to achieve them. This provides a clear roadmap for senior leaders and managers to follow as they allocate resources and make decisions. Additionally, strategy mapping can be used to track progress over time, allowing organizations to course-correct as needed."
—Becca Klein of BeccaKlein.co

"A strategy map is the only framework that elegantly displays the entire network of cause-and-effect relationships between elements of the strategy. It also provides the template for measurement and for educating and aligning the entire organization around the strategy."
—Amie Devero of Beyond Better Strategy and Coaching

"The best strategic planning framework is McKinsey's Strategic Horizons, because it helps you stay focused on expanding your business and developing new sources of income. Many businesses are fixated on increasing their present profit margins, which is fantastic in the short term but poses serious dangers to their companies due to changes in the market, consumer demand, or rivalry."
—Nick Bolshaw of Inyouths LED Mirrors

“The McKinsey Strategic Horizons framework is great for creating future revenue streams and sustaining growth within your organization. In many organizations, the focus is on increasing profit margins. Despite being great for the short term, your business faces significant risks without diversity. In some cases, this is due to changes in the market, customer demand, or competitive activity.
"It is the best strategic framework because a framework like this can be applied to the vast majority of organizations and industries. Especially popular among startups and fast-growing organizations, it helps keep a balance between cash flow and growth."
—Alice Smith of Cicinia

"I believe Objectives and Key Results is the best strategic framework because it keeps things simple at its core: It focuses on where a company wants to go and the key things needed to get there."
—Tim Connon of ParamountQuote

"With many strategic planning frameworks, it’s easy to get lost in the ‘how’ and forget about the ‘why.’ I consider OKRs the best framework to kick off your campaign because it’s hard to get lost in the details when your objectives and desired results are clearly laid out for you."
—Matt Caiola, CEO of 5WPR

"Many well-known organizations consider OKRs to be an invaluable strategic planning framework because it transforms ideas into measurable actions and encourages teams to perform at an optimum level. The core idea of OKRs is to create goals that are way above the standard, making it the best and ideal approach to consistently hit company targets or even surpass them."
—Adam Garcia of The Stock Dork

Make sure your plan succeeds with the help of strategy reporting software.

No strategic planning example is complete without mention of strategy reporting software.

The strategy execution phase is where most plans fail. Why? Because your plan alone doesn’t include crucial elements that coordinate and sustain your activities over the long term, like monitoring and reporting on progress. Maintaining focus and directing activities over a period of three to five years is an ongoing exercise that requires dedicated leadership and a systematic approach.

That’s where strategy management frameworks—and strategy reporting software like ClearPoint—come in.

ClearPoint helps organizations follow through with their activities, allowing them to adapt when internal or external conditions change, work as a unified team, and identify and react to performance problems. It also helps combat strategy fatigue by keeping your goals front and center for employees at all levels.

FAQ:

What are strategic planning models?

Strategic planning models are frameworks used to guide the strategic planning process. Common models include:

- SWOT Analysis: Identifies strengths, weaknesses, opportunities, and threats to inform strategy.
- Balanced Scorecard: Measures performance across financial, customer, internal processes, and learning & growth perspectives.
- PEST Analysis: Examines political, economic, social, and technological factors that impact the organization.
- Porter’s Five Forces: Analyzes competitive forces within an industry to understand market dynamics.
- OKR (Objectives and Key Results): Sets clear objectives and tracks key results to measure progress.
- Hoshin Kanri: Aligns an organization’s functions and activities with its strategic objectives through a systematic planning process.

What is strategic planning in business?

Strategic planning in business is a systematic process where an organization defines its strategy, direction, and decision-making processes to allocate resources effectively. It involves setting long-term goals, identifying the necessary actions to achieve those goals, and establishing metrics to track progress. Strategic planning helps businesses adapt to changing environments, prioritize initiatives, and align efforts across the organization.

Why is strategic planning important in business?

Strategic planning is important in business because it:

- Provides Direction: Clarifies the organization’s vision and long-term goals, guiding decision-making and actions.
- Aligns Resources: Ensures resources are allocated to initiatives that support the strategic objectives.
- Enhances Performance: Sets measurable goals and tracks progress to drive continuous improvement.
- Facilitates Adaptation: Helps businesses anticipate and respond to market changes and challenges.
- Engages Stakeholders: Involves employees and stakeholders in the planning process, fostering commitment and alignment.

How is strategic planning done?

Strategic planning is done through the following steps:

- Define Mission and Vision: Articulate the organization’s purpose and long-term aspirations.
- Conduct a Situational Analysis: Use tools like SWOT, PEST, and Porter’s Five Forces to assess internal and external environments.
- Set Strategic Objectives: Establish specific, measurable, achievable, relevant, and time-bound (SMART) goals.
- Develop Action Plans: Create detailed plans outlining the steps, resources, and timelines needed to achieve the objectives.
- Implement the Plan: Execute the action plans while ensuring all stakeholders are aligned and engaged.
- Monitor and Evaluate: Continuously track progress using key performance indicators (KPIs) and make adjustments as needed.

How can strategic planning improve the performance of an organization?

Strategic planning can improve the performance of an organization by:

-Focusing Efforts: Ensures all activities and initiatives are aligned with strategic goals, maximizing impact.
- Enhancing Efficiency: Helps prioritize initiatives and allocate resources effectively, reducing waste and redundancy.
- Driving Accountability: Establishes clear goals and performance metrics, holding individuals and teams accountable for results.
- Supporting Decision-Making: Provides a structured framework for making informed decisions based on data and strategic priorities.
- Fostering Innovation: Encourages proactive thinking and innovation to stay competitive and adapt to changing environments.