Edinburgh Business School MBA Strategic Planning Module 2 Modeling the Strategic Planning Process Instructor: Moataz Darwish, MBA Contents 1. The Modeling Approach a. The Components of a Model b. Benefits and Costs of the Modeling Approach c. A Functional Model 2. Strategy Making 2 The Modeling Approach A model is a structured method of thinking. Enables the component parts of complex processes to be identified and related to each other; Does not imply that the process of strategic planning occurs in individual companies exactly as described by a model. No model can describe a process exactly; A strategic planning model is an attempt to rationalize the complex processes of company decision making where the connection between cause and effect is obscure. Strategic planning model can take various forms. The power of the modeling approach lies in simplifying and making understandable what at first sight appears to be impenetrable; 3 The Modeling Approach The Components of a Model The simple strategic planning model shown in Table 2.1 represents planning as a flow process. Enablers & Barriers; Strategy Options / Choice Resource allocation Monitoring 4 The Modeling Approach The Components of a Model The model attempts to extract ‘a pattern in a stream of decisions’. Criticism: No insight into real life processes. Forecasting must precede the setting of goals as it is impossible to set goals without some sort of prediction. Counter argument: Identifies the main components of the strategic planning process, Attention should be paid to the order in which different tasks are tackled, Provides a structure for discussing strategy issues Providing the basis for a check that the necessary steps have been carried out prior to committing the company to a course of action. Takes into account that the process is dynamic and feeds back on itself, one view is that feedback is the most important element in the strategic planning proces