PADM516:

Lesson 2: Dynamics of Strategic Planning and Strategy Change Cycle - Overview

Lesson 1 discussed the meaning and importance of strategic planning and strategic management. While strategic management and strategic planning can be used interchangeably, remember that strategic management merges strategic planning with organization-wide implementation.

Lesson 2 explores the Strategy Change Cycle, discussing its significance as a guideline for strategic planning and change in public and nonprofit organizations. The Strategy Change Cycle is designed to help these organizations plan strategically, fulfill their mandates and mission, live up to their vision, and demonstrate their public value.

It is critical to outline the ten-step strategic planning process at the beginning of the course, because this process tends to be fluid, iterative, and dynamic in practice. Though it will be presented linearly in the lessons and the textbook, keep in mind that varying contexts and scenarios will require you to continuously adapt the steps.

Lesson Objectives

After completing this lesson, you should be able to do the following things:

• Articulate the purpose and the nature of the Strategy Change Cycle.
• Summarize the steps of the Strategy Change Cycle.
• Adjust the Strategy Change Cycle to fit specific circumstances.

Key Concepts From the Readings

The Strategy Change Cycle

An organization must adapt its strategy over time by identifying new opportunities, offering new value-adding activities, and aligning its behavior with societal and ethical norms. In Chapter 2 of the textbook, Bryson (2011) outlines the Strategy Change Cycle, which identifies things that the effective strategic plan will do (adapted from pp. 41–42):

• be concerned with identifying and responding to the most fundamental issues facing an organization;
• address the subjective question of purpose and the often competing values that influence mission and strategies;
• emphasize the importance of external trends and forces as they are likely to affect the organization and its mission;
• attempt to be politically realistic by taking into account the concerns and preferences of internal, and especially external, stakeholders;
• rely heavily on the active involvement of senior-level managers, and sometimes elected officials, assisted by staff support where needed;
• require the candid confrontation of critical issues by key participants in order to build commitment to plans;
• be action oriented and stress the importance of developing plans for implementing strategies; and
• focus on implementing decisions now in order to position the organization favorably for the future.

Bryson defines the Strategy Change Cycle as

a process strategy, processual model of decision making, activity-based view of strategy, or just an approach to identify and respond to challenges in which a leadership group manages the main activities in the process and often leaves much of the content of the responses and implementation methods to others. (2011, pp. 43-44)  

The Strategy Change Cycle is presented in Figure 2.1 below and on page 39 of the textbook. As you look at the figure, don’t be overwhelmed; you won’t be required to understand the entire process, which is certainly complicated. You’ll learn about each of the steps involved in the cycle in more detail throughout the semester.

A Ten-Step Strategic Planning Process

The Cycle is intended to help organizations do the following things (adapted from Bryson, 2011, p. 43):

• organize effective participation;
• create meritorious ideas for mission, goals, strategies, actions, and other strategic interventions;
• build the winning coalition needed to adopt and protect strategies during implementation;
• provide needed guidance and resources for implementation; and
• build competence and knowledge to sustain implementation and engage in the next round of strategic planning.

Page 46 of Bryson’s textbook (2011) lists the ten steps of the Strategy Change Cycle:

1. Initiate and agree on a strategic planning process.
2. Identify organizational mandates.
3. Clarify organizational mission and values.
4. Assess the external and internal environments to identify strengths, weaknesses, opportunities, and threats.
5. Identify the strategic issues facing the organization.
6. Formulate strategies to manage the issues.
7. Review and adopt the strategic plan or plans.
8. Establish an effective organizational vision.
9. Develop an effective implementation process.
10. Reassess strategies and the strategic planning process.

Adjusting the Strategy Change Cycle

To effectively address the infinitely varying nature of organizational situations, you’ll have to adapt the process outlined in the Strategy Change Cycle—though it’s important to point out that it’s only the steps in the process you’d be changing, not the strategic plan itself. The Cycle illustrates the way strategic planning acts as a response to challenges; as such, it’s more of an idealized conceptual process, an approach to reference as your situation changes. Think of the Cycle as a model for how to begin strategic planning, for what to do next, and for how to adapt to unexpected circumstances.

Explore More

Adjusting the Strategy Change Cycle

Alexander (2000) and Christensen (1999) further discuss flexibility in strategic planning in their texts Rationality Revisited and Cities and Complexity, respectively.

Check out the Balanced Scorecard from Kaplan and Norton (1996) for a way to develop your strategic planning process so that it aligns with organizational mandates, mission, and values.

 

Apply It!

The design of the strategic planning process is different for organizations in the public, private, and nonprofit sectors. No matter how many steps it contains, the strong strategic planning process will guide the organization in developing strategies relevant to its capacities and environments.

Before designing a strategic planning process, it is important to consider previous planning endeavors: What has and hasn’t worked in the past?

The questions listed here can help an organization make the choices that will finalize its overall strategic planning process. Here’s how one organization answered (questions and answers adapted from Allison & Kaye, 2015, pp. 55–56):

• Who will lead the process?
  • Led by a consultant and the executive director and board member who is chair of SP Committee (need to decide how these co-lead roles will play out in real life)
• Membership of Strategic Planning Committee?
  • Three members of the board (president, chair of SP Committee, and one other board member) and five members of the staff (executive director, finance director, development director, and attorney who has been on staff the longest and heads our Family Law Project, as well as a junior attorney because retention issues are very important
• Who makes what decisions (who decides the strategic direction for the organization, and what degree of input is sought from the board and the staff)?
  • Hopefully we can reach consensus (decisions everyone is willing to live with and support) and have broad engagement by board and staff. Board is the final decision maker and approves the plan, but it’s important to have the total support and recommendations of senior staff.
• How extensive a planning process to have?
  • Our workplan needs to ensure that we complete the process within four months.
• Will we involve external stakeholders in addition to internal (board and staff) stakeholders?
  • Important to include external stakeholders, which is something we didn’t do during the last process.
• Do we want to hold some retreats or other large group gatherings, and what might be the appropriate timing of these meetings? (Are there special events, preset meetings, or deadlines that we might want to keep in mind?)
  • Before we start to write the plan, we need to schedule one all-day board/staff retreat, during which time we will make presentations in terms of priorities and get feedback and major decisions. We need to further discuss whether all staff should be invited to the retreat or only management team and program directors.
• Who will be the primary writer of the plan (with guidance from a consultant if necessary)?
  • Executive director with support of consultant
• Are we going to use a consultant and, if yes, how best to use a consultant (what are our expectations regarding the consultant’s role)?
  • We need major guidance as to how to efficiently do this process, and expect the consultant to both facilitate discussions, make recommendations about processes, and help us ask the hard questions.
• How will be keep the board and staff informed about the SP discussions and decisions?
  • At monthly board and staff meetings, SP Committee should make reports.
• Are there other considerations for the SP process that need to be factored in when designing our workplan?
  • We need to complete the process in time to fit in with our annual budget process.

Reference

Alexander, E. R. (2000). Rationality revisited: Planning paradigms in a post-postmodernist perspective. Journal of Planning Education and Research, 19, 242–256.

Allison, M., & Kaye, J. (2015). Strategic planning for nonprofit organizations: A practical guide for dynamic times (3^rd ed.). Hoboken, NJ: John Wiley & Sons.

Christensen, K. S. (1999). Cities and complexity: Making intergovernmental decisions. Thousand Oaks, CA: Sage.

Kaplan, R. S., & Norton, D. P. (1996). The Balanced Scorecard: Translating strategy into action. Boston, MA: Harvard Business School Press.

Comprehensive Check

Take time to review the lesson. Then, take a few minutes to check your understanding of what you have learned from this lesson. Read the questions and jot down your answers before you click Show Answer.

Define the Strategy Change Cycle.

What are the key purposes of the Strategy Change Cycle?

What are the first three steps of the strategic planning process as described in the Strategy Change Cycle?