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Strategic Planning

Strategic planning is a process by which an organization envisions where it wants to
be in future and then develops a set of actions and processes that will help it achieve the set
goals (Nichols, 2016). It is an important process for organizations because it allows them to
focus their resources, both human and material, on the set goals. Failure to establish and
implement strategic plans can have severe effects on the organization’s ability to compete.
It is during my work at Chico FAS, a women’s clothing maker and retailer chain in
Fort Myers, Florida, that I realized the importance of strategic planning. The company was
doing fairly well at that time. Its products were among the most popular in the market
primarily because they were cheaper than those of their competitors. Chico FAS could
manage to make and sell women’s clothes cheaply because most of them were produced in
Asian countries were labor costs were low. Almost all of its competitors made their products
in the US where labor costs are relatively high.
Noticing the immense advantage that Chico FAS had over them, the company’s
competitors also began manufacturing their products in low-cost countries in Asia. It was,
therefore, clear that Chico FAS was not going to maintain its competitive advantage based on
price for long. At that time, the organization should have created a strategic plan to help it
stay ahead of its competitors. A key component of strategic planning is environmental scan
(Nichols, 2016). This is whereby an organization collects and interprets data about factors in
its external environment that are likely to have an impact in its operations and comes up with
plans to mitigate those effects. In the case of Chico FAS, its strategic plan would have
involved gathering data about the business moves of its competitors that were bound to erode
its competitive advantage. It would then have used the data to come up with a plan that would
help it remain profitable and grow through establishing a non-price competitive edge over its

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rivals. Failure to come with a strategic plan in the face of changing external environment
brought about by actions of its competitors made Chico FAS less competitive a few years
later.
Facing changing business environment, a different organization would have certainly
come up with a strategic plan. This is because most organizations have come to appreciate the
role that strategic plans play in concentrating their resources on goals that ensure their long-
term survival and ability to thrive. Chico FAS inability to come up with and implement a
strategic plan was, therefore, an oddity rather than the norm.

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References

Nickols, F. (2016). Strategy, strategic management, strategic planning and strategic
thinking. Management Journal, 1(1), 4-7.