Most leaders treat a step by step strategic planning process like a chore. They book a fancy hotel conference room, order expensive catering, and spend two days moving sticky notes around a whiteboard until everyone is tired enough to agree on a mission statement. Then, they go back to the office, bury that 50-page PDF in a folder named "Strategy 2026," and never look at it again.
It’s a waste of time. Honestly, it’s worse than a waste of time because it creates a false sense of security. You think you have a map, but you’re actually just holding a brochure.
True strategy isn’t about filling out a template. It’s about making hard choices. If your plan doesn't involve saying "no" to things you actually like, you haven't made a strategy; you've just made a to-do list. The real process is messy, slightly uncomfortable, and requires a level of honesty that most corporate cultures try to avoid.
The Reality Check (Phase Zero)
Before you even start the official step by step strategic planning process, you need to figure out if your team is actually ready to change. Harvard Business School professor Michael Porter famously argued that the essence of strategy is choosing what not to do.
Most companies fail here.
They want to be the low-cost leader and the premium innovator. You can't. You'll just end up in the "stuck in the middle" trap. Before you gather the team, define the "winning aspiration." This isn't a fluffy vision statement. It's a specific goal. Think about how Southwest Airlines decided to be the "low-fare airline" and literally stripped away everything—meals, assigned seating, hub-and-spoke models—to make that true. They didn't just add a goal; they subtracted distractions.
Getting the Data Right Without Drowning in It
You need a situational analysis. Most people call this a SWOT (Strengths, Weaknesses, Opportunities, Threats).
I hate SWOTs.
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Usually, they’re just lists of opinions. A strength is only a strength if it helps you win against a specific competitor. Otherwise, it’s just a fact. "We have a great culture" is a nice sentiment, but unless that culture allows you to ship software 30% faster than the guy across the street, it’s not a strategic lever.
Instead of a generic list, look at the PESTEL factors—Political, Economic, Social, Technological, Environmental, and Legal. But don't just list them. Ask: "Which of these is going to kill us in three years?"
Take the shift toward generative AI. In 2023, it was a novelty. By 2026, it's the plumbing of every enterprise. If your planning process doesn't account for the fact that "business as usual" is technically impossible now, you're already behind. Use real data. Look at your churn rates. Look at your CAC (Customer Acquisition Cost) vs. LTV (Lifetime Value). If your LTV is shrinking while your marketing spend is growing, your strategy shouldn't be "do more marketing." It should be "fix the product."
Designing the Strategic Architecture
Once you know where you are, you have to decide where you're going. This is the heart of the step by step strategic planning process.
Roger Martin, the former Dean of the Rotman School of Management, uses a framework called "Playing to Win." It boils down to five questions.
- What is our winning aspiration?
- Where will we play?
- How will we win?
- What capabilities must be in place?
- What management systems are required?
The "Where will we play" part is where the most blood is spilled. Are you targeting North America or Europe? High-end enterprise clients or scrappy startups? You cannot serve everyone. If you try, your messaging becomes bland, your product becomes a "Swiss Army Knife" that's dull at every task, and your sales team burns out.
Pick a niche. Dominate it. Then expand.
The "How Will We Win" Problem
This is your value proposition. Are you better, faster, or cheaper? Pick one. Maybe two if you're world-class. If you say "all three," you're lying to yourself.
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Amazon wins on price and convenience (Fast/Cheaper).
Apple wins on design and ecosystem (Better).
Both are trillion-dollar companies. Both have very different strategic plans. Your "How to Win" needs to be something your competitors can't easily copy. If your strategy is "to have better customer service," that's a goal, not a strategy. A strategy would be "investing 20% of revenue into a proprietary AI support layer that reduces wait times to zero," because that is a tangible, defensible capability.
Execution is Where the PDF Goes to Die
You’ve got the plan. Now what?
Most strategic plans fail because they are too big. You have 15 "strategic priorities." No human being can focus on 15 things.
Narrow it down to three.
Use OKRs (Objectives and Key Results). This framework, popularized by Andy Grove at Intel and later John Doerr at Google, keeps things honest. The Objective is the "what." The Key Results are the "how we know we're getting there."
For example:
Objective: Become the preferred payment provider for mid-sized e-commerce brands in the UK.
Key Result 1: Onboard 500 new merchants with >£1M annual turnover by Q4.
Key Result 2: Achieve a Net Promoter Score (NPS) of 70+.
Key Result 3: Reduce merchant integration time from 14 days to 4 days.
See the difference? It’s not "improve the product." It’s "reduce integration time to 4 days." That is something an engineer can actually work on.
The Feedback Loop: Strategy is Living
A strategy shouldn't be a stone tablet. It’s more like a GPS. If there’s a roadblock—a new competitor, a market crash, a global pandemic—the GPS reroutes.
Schedule quarterly strategy reviews. Not "status updates." Strategy reviews.
Ask: "Are our assumptions still true?"
If you assumed the market would grow by 5% and it’s shrinking by 2%, your strategy is now wrong. It doesn't mean you're a bad leader; it means the environment changed. The step by step strategic planning process must include a mechanism for "pivoting" without losing the core mission.
Intel provides the classic example of this. They were a memory chip company. That was their identity. But the market shifted to microprocessors. Because they had a culture that allowed for strategic shifts, they abandoned their core business to pursue the future. It was painful. It was controversial. It also saved the company.
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Actionable Steps to Start Today
Don't wait for the next fiscal year. If your current trajectory feels off, start the step by step strategic planning process now.
1. Conduct a "Pre-Mortem"
Gather your leadership team. Imagine it is one year from today and your company has completely failed. Why did it happen? This exercise bypasses corporate optimism and uncovers the real risks you’re ignoring.
2. Audit Your Calendar
Look at where your leadership team spends their time. If your "strategy" is innovation, but you spend 90% of your meetings talking about daily operations and "putting out fires," your strategy is a lie. Your calendar is your real strategy.
3. Kill One Project
Find a project that is "fine" but not "great." It’s consuming resources—money, time, mental energy. Kill it. Reallocate those resources to your top strategic priority. This sends a signal to the whole company that the new plan is real.
4. Simplify the Communication
If your employees can't explain the strategy in two sentences, you don't have one. Write a "Strategy on a Page." It should list the winning aspiration, the target market, and the three big bets for the year. Print it. Put it on the wall.
Strategy is about clarity. It's about the courage to choose a path and the discipline to stay on it until the data proves you should turn. Stop planning for the sake of planning and start making choices that actually move the needle.