Strategic direction

Strategic direction
See also
Strategic goals Marketing concept Activity-based management Strategic management model Balanced scorecard perspectives Key performance indicator (KPI) Customer focus Strategy deployment Strategic statement

Strategic direction refers to the overall direction and scope of an organization's actions and decisions. It is a long-term plan that outlines the organization's goals and objectives, and the means by which it intends to achieve them. It is typically developed by senior management and is used to guide the organization in making decisions and allocating resources. The strategic direction should align with the organization's mission and vision, and be adaptable to changes in the external environment.

Examples of strategic direction

There are many different examples of strategic direction, but some common ones include:

• Growth: Organizations may set a strategic direction of growth, which involves expanding their operations and increasing market share. This can be achieved through mergers and acquisitions, expanding into new markets, or developing new products or services.
• Cost leadership: Organizations may set a strategic direction of cost leadership, which involves reducing costs and increasing efficiency in order to offer products or services at a lower price than competitors. This can be achieved through process improvements, outsourcing, or automation.
• Innovation: Organizations may set a strategic direction of innovation, which involves developing new products, services, or business models that differentiate the organization from competitors. This can be achieved through research and development, experimentation, or collaboration with external partners.
• Sustainability: Organizations may set a strategic direction of sustainability, which involves taking into account environmental, social, and economic impacts in their operations and decision making. This can be achieved through practices such as reducing carbon emissions, fair labor practices, and ethical sourcing.
• Customer focus: Organizations may set a strategic direction of customer focus, which involves understanding and meeting the needs of customers. This can be achieved through customer research, creating customer-centric products and services, and investing in customer service and support.

These are just a few examples, and many organizations may have a combination of these or other strategic directions. The important aspect is that the strategic direction is aligned with the organization's mission, vision, and goals.

The role of vision and mission in strategic direction

The mission and vision of an organization play a crucial role in determining its strategic direction. The mission statement is a statement that defines the organization's purpose and the fundamental reason for its existence. It is a statement of purpose that guides the organization's decision-making and activities. The vision statement, on the other hand, is a statement that describes the organization's aspirations and the future state it wishes to achieve. It is a statement of long-term goals that guides the organization's strategic direction.

Together, the mission and vision statements provide the organization with a clear sense of direction and purpose. They help to define the organization's values and priorities, and serve as a basis for developing strategic goals and objectives. They also provide a framework for evaluating the effectiveness of the organization's strategic direction, by serving as a benchmark against which the organization's performance can be measured.

The strategic direction should align with the organization's mission and vision, and be adaptable to changes in the external environment. The organization should regularly review and update its mission and vision statements, and align its strategies and actions with them.

Strategic direction statement (template)

A strategic direction statement template can serve as a guide for creating a clear and concise statement that outlines an organization's goals and objectives, and the means by which it intends to achieve them. Here is a sample template that you can use:

• Introduction: Briefly explain the purpose of the strategic direction statement, and provide an overview of the organization's current situation and external environment.
• Mission statement: Clearly state the organization's mission, which is a statement of its purpose and fundamental reason for existence.
• Vision statement: Clearly state the organization's vision, which is a statement of its aspirations and future state it wishes to achieve.
• Goals and objectives: Clearly state the organization's goals and objectives, which are specific, measurable, and time-bound targets that the organization aims to achieve.
• Strategic direction: Clearly state the overall direction and scope of the organization's actions and decisions, and how the goals and objectives will be achieved.
• Key strategies: Clearly state the key strategies that will be used to achieve the goals and objectives, and explain how they align with the organization's mission and vision.
• Implementation plan: Clearly state the implementation plan, which outlines the specific actions and tasks that will be taken, and the resources that will be required to achieve the goals and objectives.
• Evaluation and control: Clearly state the evaluation and control process, which outlines the criteria that will be used to measure performance, and the mechanisms that will be used to monitor progress and make adjustments as needed.
• Conclusion: Sum up the main points of the strategic direction statement, and emphasize the importance of aligning the organization's actions and decisions with its mission, vision, and goals.

It's worth noting that each organization may have different needs, and the template can be adjusted to fit the specific needs of the organization. The most important thing is that the strategic direction statement is clear and concise, and aligns with the organization's mission, vision, and goals.

References

• Rotemberg, J. J., & Saloner, G. (2000). Visionaries, managers, and strategic direction. RAND Journal of Economics, 693-716.
• Proctor, T. (1997). Establishing a strategic direction: a review. Management Decision, 35(2), 143-154.
• Easterwood, J. C., Seth, A., & Singer, R. F. (1989). The impact of leveraged buyouts on strategic direction. California Management Review, 32(1), 30-43.