Strategic Planning: Scanning the Horizon
Any planning activity involves thinking about the future. However, the focus of
strategic planning is not on predicting the future, but instead on making better
decisions here and now in order to reach a desired future. Because the future cannot
be known with certainty, farm business managers must make certain assumptions
about what the future will hold. An important part of the strategic planning process
is to recognize and explicitly state any key assumptions about the future business
environment or markets. To be successful, the farm business manager must find a fit
between what the market wants and what the farm provides, as well as between what
the business environment or markets will provide and what the farm needs.
Strategic planning requires that, in thinking about the future, managers have
information about both the external economic environment in which the farm
business operates and the internal characteristics of the farm business. This
publication provides information on how to assess the external environment. It
includes two worksheets to help you assess the external business environment,
“Applying the Five Forces Model” and “Assessing Opportunities and Threats.” The
information developed as part of the assessment process will provide data for the
development and evaluation of alternatives.
In conducting a market assessment, the farm business manager reviews and
evaluates information from the external business environment. The focus is on
expected market and business changes over which the manager has little or no
control. There are two facets of this outside review: 1) the social environment and 2)
the industry environment, on which this publication concentrates.
For a PDF of the full paper, click here.