3.Theories, Concepts, & Rationale of

Strategic Planning

a. Theories of Planning

b. Concepts of Strategic Planning

c. Rationale of Strategic Planning

At the end of the lecture, the students will be

able to:

1. Describe the different theories of strategic planning

and the crisis it had undergone;

2. Compare and contrast the different concepts of

strategic planning in the context of the business

world, administrative leadership and behavior, and

socio-economic development; and

3. State the various purposes and rationale of strategic

planning

• Planning as a human and professional activity

and an area of academic inquiry lacks

disciplinary focus

• Planning, just like her mother PA, has no

intellectual turf of its own. Each is like a moon

which borrows its light from the sun and stars

• Thus, its heavy reliance from multiple

disciplines makes planning an easy target for

question and debate

H. Simon (1969) describes it as an

“artificial” science

Wildavsky (1973) observes: “If planning is

everything, maybe it is nothing”

S.J. Klees (1986) argues that “it is

technocratic cultism and political

curtailment of individual freedom”

D. Adams (1991) – “Planning is a quasi-

science that incorporates the latest

developments in the information

technology and administrative sciences,

the insights of the social science

disciplines, and the design capabilities

of engineering profession

Planning is a process for accomplishing

purpose.

• It is blue print of business growth and a

road map of development.

• It helps in deciding objectives both in

quantitative and qualitative terms.

• It is setting of goals on the basis of

objectives and keeping in view the

resources (wikipedia)

In spite of new and powerful

technology capable of analyzing

vast amounts of data, determining

trends, and modeling alternative

futures, planning suffers from

identity, theory and utility

According to Adams (1991) these are:

1. Philosophical synthesis

2. Rationalism

3. Organizational Development (OD)

4. Empericism

PHILOSOPHICAL SYNTHESIS – tends

to emphasize a broad aspect to

planning which seek insights into social,

economic, and ethical conditions as

well as environmental context of the

institution or sector for which planning is

being undertaken

RATIONALISM models of planning

assume a sequential, observable,

cycle that includes setting of goals,

determining objectives, making

plans, implementing the plans, and

reviewing the results

ORGANIZATIONAL DEVELOPMENT

– focuses primarily on ways to

achieve organizational change. It

includes a human relations approach

to innovation and change in

management style, employee

satisfaction, decision-making

process. And the general health of

the organization

EMPERICISM – recognizes the

significance of system behavior

studies by public administrators,

economists and other social

scientists concerned with planning

theory

SOCIO-ECONOMIC DEVELOPMENT:

The concept of DEVELOPMENT

PLANNING planning came about as

the more legitimate, appropriate and

culturally-oriented framework in the

formulation of social, economic, and

political national plans and policies

DEVELOPMENT PLANNING – is

basically the act of choosing. It is

deciding in advance the WHAT, the HOW,

the WHEN, and the WHO of determining

goals, policies and plans and conscious

setting of alternative courses of action,

procedures and strategies needed to

achieve the purposes of government

(NEDA, 1982)

BUSINESS PLANNING

• 1922 – Harvard Dean Wallace Donham

made the argument that unless

businesses systematized decision-making

practices, they were not much from

gambling efforts

• 1960s-’70s – Harvard Business Review

had indicated its interest articles on long-

range strategic planning (N. Capon et al.,

1987)

• 1976 Lorange and Vancil viewed strategic planning (SP) as a single process whereby managers must agree on a detailed integrated plan of action for the coming year starting with the delineation of corporate objectives and concluding with one-or two-year profit plan

• Further, they identified six processes that top management has to deal with:

a) communicating corporate goals,

b) developing the goal setting process,

c) scanning the environment,

d) understanding the subordinate-manager focus

e) developing the planner’s role, and

f) developing the link between planning and budgeting

• 1974 defines SP as the continuous process of making entrepreneurial decisions systematically and with the greatest knowledge of their futurity, organizing systematically the efforts needed to carry out these decisions and measuring the results of these decisions against expectations through organized feedback (Peter Drucker).

• 1981 in the perspective of education and social development, SP is perceived as a set of purposeful actions influencing and organization or some part therein to effect change (K.C. Tanner and E.J. Williams)

• 1984 SP is viewed as the effective

application of the best alternative

information to decisions that have to be

made now to ensure a secure future (G.S.

Day)

• 1994 SP is viewed as a long-term planning

to achieve a preferred vision for an

organization, school or school district. It

defines the WHATS to be achieved

• SP as a dynamic process which scans current realities and opportunities in order to yield useful strategies and tactics for arriving a better tomorrow.

• It is not a linear, lock-step process derived or implemented in an authoritarian manner. Nor it is intuitive or built on hunches and raw feelings.

• It involves the educational partners in defining and supporting the purposes and missions and its provides blueprints for result-oriented program ( R.A. Kaufman, 1972, 1988 R.A. Kaufman and J. Herman, 1991, R.A. Kaufman, J. Herman and K. Watters, 1996)

• It appears that no single definition has been able to capture all facets of contemporary SP practices despite the array of disciplinary perspective. Six common distinguishing features, however, shape the acceptable meaning:

1. external orientation,

2. a holistic or systematic approach,

3. a process of formulating plan, objectives, strategies and programs,

4. use of systematic methods in the analysis of strategic situation and alternatives,

5. commitment to actions, and

6. a knowledge of results

• To reorient the organization to the

needs of the community in order to

foster relevant and quality service

• As we plan for expansion, a certain

level of minimum standard to be

observed to guarantee a certain level

of minimum quality performance

• Effective SP efforts make the organization become more viable instrument of socio-economic development of the nation

• Since resources for sectoral services are irreversibly becoming less, priorities have to be established

• The galloping inundation and explosion of a new knowledge and the emergence of new technologies as brought about by advances in science and ICT.

• SP means realistic forecasting of events

and in exercise “futurology”

Reference:

Miclat, Jr. Eusebio F. Development Planning

& Budgeting, PSU, 2004