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Definition and Purposes of Strategic Planning Linking Performance Management To The Strategic Plan

This document discusses the importance of linking strategic planning and performance management. It defines strategic planning as assessing an organization's direction and preparing for the future. An effective strategic plan involves analyzing internal strengths and weaknesses as well as external opportunities and threats. The plan should include the organization's mission, vision, goals and strategies. Individual and team performance management should then be aligned with and support the strategic plan. Job descriptions, performance criteria and rewards should all connect back to and help achieve the organization's strategic objectives. Buy-in at all levels is critical for effective implementation.

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Maryam Saleem
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Download as PDF, TXT or read online on Scribd
94 views

Definition and Purposes of Strategic Planning Linking Performance Management To The Strategic Plan

This document discusses the importance of linking strategic planning and performance management. It defines strategic planning as assessing an organization's direction and preparing for the future. An effective strategic plan involves analyzing internal strengths and weaknesses as well as external opportunities and threats. The plan should include the organization's mission, vision, goals and strategies. Individual and team performance management should then be aligned with and support the strategic plan. Job descriptions, performance criteria and rewards should all connect back to and help achieve the organization's strategic objectives. Buy-in at all levels is critical for effective implementation.

Uploaded by

Maryam Saleem
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Performance Management and Strategic

Planning: Overview
Definition and Purposes of Strategic Planning
Linking Performance Management to the
Strategic Plan
– Strategic Planning
– Developing Strategic Plans at the Unit Level
– Job Descriptions
– Individual and Team Performance
Building Support
Herman Aguinis, University of Colorado at Denver
Strategic Planning: Definition
• Process
– Describe organization’s destination
– Assess barriers
– Select approaches for moving forward

Herman Aguinis, University of Colorado at Denver


Strategic Planning: Goal

• Allocate resources
– to provide organization
– with competitive advantage

Herman Aguinis, University of Colorado at Denver


Strategic Planning: Purposes
 Help define the organization’s identity
 Help organization prepare for the future
 Enhance ability to adapt to environmental
change
 Provide focus and allow for better
allocation of resources

(continued on next slide)


Herman Aguinis, University of Colorado at Denver
Strategic Planning: Purposes
Produce an organizational culture of
cooperation
Allow for the consideration of new options
and opportunities
Provide employees with information to direct
daily activities

Herman Aguinis, University of Colorado at Denver


Strategic Planning : Overview

1. Environmental Analysis
2. Mission
3. Vision
4. Goals
5. Strategies

Herman Aguinis, University of Colorado at Denver


Environmental Analysis

Identifies external and internal trends


• To understand broad industry issues
• To make decisions using “big picture” context

Herman Aguinis, University of Colorado at Denver


External trends
• Opportunities:
– environmental characteristics that can help
the organization succeed

• Threats:
– environmental characteristics that can
prevent the organization from being
successful

Herman Aguinis, University of Colorado at Denver


External trends –
Factors to Consider
• Economic • Technological
• Political/legal • Competitors
• Social • Customers
• Suppliers

Herman Aguinis, University of Colorado at Denver


Internal trends
• Strengths:
– internal characteristics that the organization
can use for its advantage
• Weaknesses:
– internal characteristics that can hinder the
success of the organization

Herman Aguinis, University of Colorado at Denver


Internal trends –
Factors to Consider
• Organizational structure
• Organizational culture
• Politics
• Processes
• Size

Herman Aguinis, University of Colorado at Denver


Gap Analysis

Analyzes:
External environment
(opportunities and threats)
vis-à-vis
Internal environment
(strengths and weaknesses)

Herman Aguinis, University of Colorado at Denver


Gap analysis determines:

Opportunity + Strength = Leverage

Opportunity + Weakness = Constraint

Threat + Strength = Vulnerability

Threat + Weakness = Problem


Herman Aguinis, University of Colorado at Denver
Strategic Planning for the Organization

Environmental and Gap Analyses provide


information for organizations to decide:
Who they are
What they do

Herman Aguinis, University of Colorado at Denver


Mission

A good mission statement answers:


Why does the organization exist?
What is the scope of the organization’s activities?
Who are the customers served?
What are the products or services offered?

Herman Aguinis, University of Colorado at Denver


Mission Statement contains:
A. Information on organization’s
 Basic product/service to be offered
 Primary market/customer groups
 Unique benefits and advantages of
product/services
 Technology to be used
 Concern for survival through growth and
profitability

Herman Aguinis, University of Colorado at Denver


Mission Statement may contain:
B. Information on organization’s values and beliefs
 Managerial philosophy
 Public image sought by organization
 Self-concept of business adopted by
 Employees
 Stockholders

Herman Aguinis, University of Colorado at Denver


Vision
• Statement of future aspirations
• Focuses attention on what is important
• Provides context for evaluating
– Opportunities
– Threats

Herman Aguinis, University of Colorado at Denver


A Good Vision Statement is:

Brief Focused
Verifiable Understandable
Bound by a Timeline Inspiring
Current A stretch

Herman Aguinis, University of Colorado at Denver


Purposes for Setting Goals
• Formalize expected achievements
• Provide motivation
• Provide tangible targets
• Provide basis for good decisions
• Provide basis for performance measurement

Herman Aguinis, University of Colorado at Denver


Strategies
• Create strategies or Game Plans or “How to”
procedures to address issues of:
– Growth
– Survival
– Turnaround
– Stability
– Innovation
– Leadership

Herman Aguinis, University of Colorado at Denver


How the HR Function contributes:
• Communicate knowledge of strategic plan
• Provide knowledge of KSAs needed for
strategy implementation
• Propose reward systems

Herman Aguinis, University of Colorado at Denver


Strategic Plans at the Unit Level
• Organization Mission statement, Vision
statement, Goals, and Strategies
Must clearly align with
And be congruent with
• Every Unit Mission statement, Vision
statement, Goals, and Strategies

Herman Aguinis, University of Colorado at Denver


Alignment of Strategic Plan with
Performance
Organization’s Strategic Plan
Mission, Vision, Goals, Strategies

Critical to involve all


Unit’s Strategic Plan levels of management
Mission, Vision, Goals,
Strategies
Job Description
Critical to involve all employees Tasks, KSAs

Individual and Team Performance


Results, Behaviors, Developmental Plan
Herman Aguinis, University of Colorado at Denver
Job Descriptions
• Tasks and KSAs are congruent with
Organization and Unit strategic plans
• Activities described support mission and
vision of Organization and Unit

Herman Aguinis, University of Colorado at Denver


Individual and Team Performance
Organization and Unit mission, vision, goals lead to
 Performance management system, which
Motivates employees
Aligns development plans with organization priorities

Herman Aguinis, University of Colorado at Denver


Strategic Plan 
Choices in PM System Design

• Criteria (Behavior vs. Results)


• Participation (Low vs. High)
• Temporal Dimension (Short Term vs. Long Term)
• Level of Criteria (Individual vs. Team/Group)
• System Orientation (Developmental vs.
Administrative)
• Rewards (Pay for Performance vs. Tenure/Position)

Herman Aguinis, University of Colorado at Denver


Building Support –
Answering “What’s In It for Me?”

• Top Management:
– Help carry out vision
• All levels:
– Involvement
– Participation
– Understanding

Herman Aguinis, University of Colorado at Denver

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