UNIT 1
Question 2. Why is strategic planning important to managers? Explain the importance of
setting hierarchical goals.
Strategic planning is important to managers because managers must first know what they
want to accomplish strategically before they can effectively formulate and execute specific
human resource management policies and practices. Strategic planning is the process of a
firm asking “where are we now?”, “where do we want to be?”, and “how should we get
there?”. The “how to get there?” question is answered by formulating specific plans
(including human resources).
A company’s strategic plan is essentially how it will match its internal strengths and
weaknesses with external opportunities and threats in order to maintain a competitive
advantage. Such planning helps an organization chart a course for the achievement of its
goals.
Strategic planning helps firms get a realistic view of their current strengths and weaknesses
relative to competitors. For example, the management team may find areas where
competitors may be vulnerable and then develop marketing strategies to exploit these
weaknesses. The team may also observe competitors’ actions to help identify opportunities
they may have overlooked, such as emerging international markets or opportunities to
market products to completely different customer segments.
Strategic planning also provides a sense of direction and outlines measurable goals. The
strategic plan is not only a tool that is useful for guiding day-to-day decisions, but also for
evaluating progress and changing approaches when moving forward. In order to make the
most of strategic planning, management must give careful thought to the strategic
objectives it outlines, and then back up these goals with realistic, thoroughly researched,
