Improving Strategic Planning

Strategic planning is critical to the continued success of any organization, yet fewer than half of the executives who responded to a new online survey conducted by The McKinsey Quarterly say that they are satisfied with their company's approach to planning strategy.

Some key findings:

• More than half of all respondents say that at their company the important strategic decisions are made by a small group of senior managers, including the CEO.
• No matter who leads the decision making, executives at companies that make good use of a formal process seem to be more satisfied with strategic planning.
• Most respondents say that their company's board of directors focuses on a few roles in planning strategy. Boards are seen to be most active in challenging strategy during the development process and in approving the final strategy .

More important than strategy, however is execution.

• A significant number of respondents express concern about executing strategy. Some 28 percent say that their company produces a strategic plan that reflects the company's goals and challenges but is not effective.
• Another 14 percent say the strategy and plans for executing it are not necessarily aligned with each other.
• 67 percent say aligning management with the strategy is an element of the strategic-planning process.

On measurement:

• Monitoring progress is an area where many executives see room for improvement. Only 56 percent of respondents say that their company currently tracks the execution of its strategic initiatives.