Business planning in successful small firms

Strategic planning has been widely publicized during the last decade, but what has been accomplished by this management activity in smaller, high-growth firms? Business plans have been widely recommended for start-up funding, but we have noted additional uses for business plans in pratice. This article reports methods and results of strategic planning and written business plans in high-growth ‘INC. 500’ firms. In spite of a variety of obstacles, over half of the firms conduct strategic planning on a regular basis. Results of this study show that fast-growth firms develop written business plans as a product of strategic planning, mainly by five key management personnel. Written business plans are used more for internal management purposes than for start-up funding. Finally, the completion of strategic planning is positively associated with a firm's profitability. Based on survey and interview data, this article describes a four-phase model to help ensure effective integration of strategic planning processes and the resulting written business plans.     

Using strategic issue analysis

Strategic issue analysis is proposed as a method for resolving the strategic issues that are an important part of strategic management. The SIA process is one in which a strategic issue information model is developed using a joint manager-analyst teamwork approach. The issue models and supporting data then provide the basis for strategic decision making. The approach has numerous advantages over other approaches— both more and less formal—for resolving the strategic questions that must be addressed in any comprehensive planning process.     

Formal strategy in public hospitals

This paper suggests that the difficulties associated with the application of formal strategic planning in public professional service organizations may have been underestimated in much of the literature. A survey of written strategic plans produced by Canadian hospitals showed that these plans were often heavily oriented towards expansion, ambiguous and rather loosely integrated, leading to questions concerning their realism and utility as a basis for strategic decisions. This phenomenon seems symptomatic of the complex (and often highly political) decision making environment faced by hospital administrators (and by managers of other professional service organizations such as universities and social service agencies). It is concluded that the benefits of formal planning may be different and less tangible for these organizations than for private business.     

Manufacturing resource planning: An information systems model

This paper presents Manufacturing Resource Planning, an information system that will enable the developing and monitoring of strategic plans. Incorporation proven material and capacity requirements planning techniques, strategic planners can determine readily the impact of their plans on the manufacturing resources of the company. Decision making is more coordinated because all managers work from a common data base. However, the attainment of this level of planning sophistication is costly not only in capital outlays for computer software and hardware but also in the time to train users. But those firms who have successfully incorporated this integrated approach to strategic planning feel strongly that the end results justify the expenditures.     

Strategic planning—A new arrival in Hungarian industry

This paper outlines the fairly recent history of strategic planning in Hungary, which is still by no means widespread. Strategic planning in business has to co-exist with the official national 1 and 5 year plans. At the present time some 30 percent of Hungarian industrial companies have some type of strategic planning practice, and the rest have some version of official planning. Those with good independent planning practices have proved more able to survive in a changing environment.     

A decision support system for banks

Just recently, information systems with rather unique characteristics have begun to emerge. These systems usually referred to as Decision Support Systems, feature decision models, a data base and the decision maker as subsystems and are specifically oriented to supporting decision making. This article examines Decision Support Systems and their application to banks.     

The components of strategic planning

What is the current level of strategic planning in the United States? What objectives are quantified in the strategic plans? What kinds of environmental factors are identified in the planning process? What areas are planned for? How often are the strategic plans reviewed? These are among the questions which were raised in a recent survey of 323 companies whose results are summarized in this paper. It is hoped that this study will permit practitioners to compare their planning with planning being performed in their industry.Suggested improvements in the stategic planning process include more frequent monitoring of performance against the plans, more comprehensive environmental surveillance, and greater emphasis on organizational structure plans. The strategic planning process was found to be constantly evolving and cyclical. The strategic planning activity expanded during adversity and contracted when business prospects were good.     

Implementing strategic plans through strategic program evaluation

Strategic Program Evaluation (SPE) is proposed as a method for linking the choice elements of corporate strategy—missions, objectives, strategies, goals, programs etc.—to ensure that strategic plans are implemented. Such a use of SPE requires the exposition of the specific relationships among the strategic choice elements and the development of evaluation criteria that can be used to develop a program structure that effectively implements higher level strategic decisions.     

Developing strategic thinking

This paper looks at the problem of getting managers to contribute effectively to strategic planning, and focuses on the role of management development approaches in ensuring that this happens. A number of formal, and less formal, management development techniques are discussed in the light of their relevance for developing strategic awareness. The importance of providing exposure to strategic issues at an early stage in managers' careers is stressed, and also the need to encourage managers to take initiatives in obtaining their own development. Some of the most fruitful techniques involve taking full advantage of the ‘natural learning’ that takes place on the job, and those which provide a close integration between management development and the planning process—such as projects and ‘task forces’. Finally the role of senior managers in helping to create and maintain a climate in which strategic abilities can develop is discussed.     

Integrating strategic issues into strategic management

The notion of a ‘strategic issues’ is rather pervasive in the field of planning in both conceptual [5, 19] and practical contexts. For instance, sometime ago the Wall Street Journal [41] reported that at least 50 large firms have created positions of ‘issues management director’; a dramatic increase in the number of such positions. ‘True’ strategic issues have a readily apparent importance to any organization; yet the process of identifying such issues and of integrating them into strategic planning and management is not well developed. Most treatments of strategic issues deal only with specific segments of the overall process through which relevant issues may be initially identified and finally translated into appropriate strategy [e.g. 5, 17]. This paper demonstrates that it is practical to develop a comprehensive process of ‘strategic issue management’ (SIM) that will facilitate the systematic identification, assessment and analysis of such issues. Such a process can ensure that issue-related factors are fully integrated into the formulation and implementation of strategy and plans. As such, SIM is a process whereby strategic issues may become an integral element of strategic management.     

How physicians can create their future

This article responds to the need for physicians to become proactive, using strategic planning to address changing conditions in the health care field. Strategic planning purposes are defined and a common process of strategic planning is presented. A case study analysis includes commentary on the need for planning, the context of planning in a larger system, process and procedure, a sample plan, benefits and actions to date, and future uses of the plan. Implications of this case of strategic planning for other physicians are discussed.     

Can technology be managed strategically?

The purpose of this article is to investigate techniques for inserting strategic management of technology into the overall business planning process. The method developed here begins with defining the technological profile of a company and then proceeds to expand the method to incorporate analytical procedure for technology futuring, and finally combining these long-range forecasts with the company's policies and plans into an integrated planning model. An illustrative case study of the NCR Corporation is appended to demonstrate the application.     

Public Knowledge of and Involvement with Metropolitan and Local Strategic Planning in Australia

Despite academic and practitioner debate surrounding public involvement in planning, little is actually known about the extent to which the public is aware of the planning process. The focus of this paper is the examination of the underlying, latent public knowledge of the planning system in Australia. This latent knowledge (or more accurately, the absence of this knowledge) emerges as a barrier to public involvement. This paper examines public perceptions of the importance of metropolitan and local strategic plans, knowledge of these plans, the main sources of this knowledge, and the extent to which the public is likely to become involved with strategic planning process. The paper concludes that despite large segments of the population viewing strategic planning as important, only a small proportion is actually aware of the plans themselves, while an even smaller proportion is likely to become involved in the planning process.     

Aggregate production planning using spreadsheet software

Firms can benefit by developing and using aggregate production plans. However, reports of ongoing production planning applications are rare. The complexity of production planning models has been cited as one of the reasons that firms do not develop formal production plans. This study was conducted to determine if a simple model, trial-and-error on a spreadsheet, could be used to produce cost-effective production planning solutions. Results indicate that good solutions can be obtained using this method. Furthermore, solutions tend to improve as the knowledge of the production planner increases and as time spent developing solutions increases. In addition, experience at producing spreadsheet-based solutions can translate into lower cost solutions for more complex problems while using less time for analysis. These findings indicate that spreadsheets can be effective decision aids for developing production planning solutions. By coupling the power and simplicity of a spreadsheet modelling package with the trial-and-error approach to production planning, model complexity should no longer be cited as a reason for not developing and using formal aggregate production plans.     

Strategic management in a government agency

Strategic management is often needed in political bureaucratic environments, but it is neither easy nor natural. This article explores the developments in the involvement of management in strategic planning. It traces the transition from strategic planning to strategic management by taking implementation and institutionalization into account, and the transition from strategic management to strategic leadership, by taking political processes into account.     

Planning in a free market economy

This paper is based on a research study project on Premises and Process of Introducing Strategic Planning in a Company. It presents and discusses some major findings of the study concerning the content of strategic decisions, the elements of a planning system, the process of introducing strategic planning and the impact of environmental conditions upon the strategic planning system.     

How corporate planning responds to uncertainty

This article is based upon an SSRC research project into the influence of computer methods on decision making. During this research, information on the planning systems of a cross-section of British industry was obtained.The paper illustrates how managers in these firms were coping with planning in the present conditions of extreme uncertainty about the future, combined with adverse economic and business conditions. Conventional planning theory, together with some modern observations on it, are briefly described and then the paper shows how, in the firms visited, the structure of planning was more complex than this theory.It goes on to show that today's critical conditions were not leading to management putting aside their plans and computer models and “muddling through’. They were actually leading to an acceleration in the adoption of formal planning and decision making methods but in a somewhat different manner to conventional planning theory.Seven different modes of planning were identified with integrated operational planning being the most common, possibly the most essential to survival and sometimes the only planning possible into today's conditions. A trend to extend the operational plan to 2 to 3 years and to reduce the firm's long range plan from 5 to 3 years was also observed.Long range plans were being considered as planning and decision making tools and not as blue-prints of the firm's future, as accurate long range forecasting was impossible. Three types of strategic planning were identified with that carried out at intervals probably being the most appropriate for medium sized firms in today's conditions.     

Distributed manufacturing support systems: the integration of distributed group support systems with manufacturing support systems

Current Manufacturing Support Systems (MSS), such as Computer-aided Manufacturing (CAM) Systems, Computer-aided Design (CAD) Systems, Computer Integrated Manufacturing (CIM) Systems, Material Resource Planning (MRP) Systems, and Manufacturing Accounting Control (MAC) Systems, are mostly independent systems that are operated in limited decision spaces, provide mainly formal and quantitative information, and thus pursue a goal of local optimization. To assist modern manufacturing in meeting the needs for integration, communication, collaboration, and decision making, we introduce the concept of integrating MSS with Distributed Group Support System (DGSS) into a Distributed Manufacturing Support System (DMSS). A rigorous system design approach is taken to model the manufacturing information requirements from a global perspective and pattern decision making processes within the structural (organizational design) and infrastructural (information system design) elements of manufacturing. The result is a conceptual DMSS design that provides an intelligent interface, accommodates incremental manufacturing integration, offers controllable message exchange facilities, and allows configurable communication networks.     

How to support the application of multiple criteria decision analysis? Let us start with a comprehensive taxonomy

Decision making is a complex task that involves a multitude of perspectives, constraints, and variables. Multiple Criteria Decision Analysis (MCDA) is a process that has been used for several decades to support decision making. It includes a series of steps that systematically help Decision Maker(s) (DM(s)) and stakeholders in structuring a decision making problem, identifying their preferences, and building a decision recommendation consistent with those preferences. Over the last decades, many studies have demonstrated the conduct of the MCDA process and how to select an MCDA method. Until now, there has not been a review of these studies, nor a proposal of a unified and comprehensive high-level representation of the MCDA process characteristics (i.e., features), which is the goal of this paper. We introduce a review of the research that defines how to conduct the MCDA process, compares MCDA methods, and presents Decision Support Systems (DSSs) to recommend a relevant MCDA method or a subset of methods. We then synthesize this research into a taxonomy of characteristics of the MCDA process, grouped into three main phases, (i) problem formulation, (ii) construction of the decision recommendation, and (iii) qualitative features and technical support. Each of these phases includes a subset of the 10 characteristics that helps the analyst implementing the MCDA process, while also being aware of the implication of these choices at each step. By showing how decision making can be split into manageable and justifiable steps, we reduce the risk of overwhelming the analyst, as well as the DMs/stakeholders during the MCDA process. A questioning strategy is also proposed to demonstrate how to apply the taxonomy to map MCDA methods and select the most relevant one(s) using real case studies. Additionally, we show how the DSSs for MCDA method recommendation can be grouped into three main clusters. This proposal can enhance a traceable and categorizable development of such systems.     

The role of strategic planning in small business

One of the important reasons for the tremendous interest in corporate strategy and strategic planning is that managers realize that a good strategy greatly increases the likelihood of a firm's success. Strategic planning is not the only reason for success, but there have been several studies which show that firms that plan their strategies are more effective. Taking the relationship of strategy and success as given, this paper considers the need to develop strategic planning for small businesses, and summarizes the findings of a recent survey on strategy of small businesses.Sixty-two minority and 58 non-minority small businesses were studied in this survey. A Likert-type questionnaire was used for the study. The survey indicates that the small businessmen fail, cope, and learn in the struggle for survival. Judgment, experience and intuition seem to play a more important role than any well structured technique of strategic planning. The businessmen were found to be ‘growth maniacs’, since growth may be the most tangible manifestation of achievement. The study leads to the conclusion that efforts should be made to improve the planning knowledge of this vital sector of economy.