There are many ideas on what constitutes strategic thinking and how it should be implemented at various organizational levels. Past methods of strategic planning that were formerly process- and task-oriented have developed into the outline of a thought process defined as strategic thinking. Strategic thinking combines creative and analytical thinking skills to help managers ask questions, create ideas, and implement methods that create new value in organizations and the bigger business ecosystem in which they function.
Strategic thinking skills require managers to assess competition, organizational resources, and market trends by analyzing patterns and relationships in order to gain foresight for developing unique strategic plans and solutions. Continuous strategic thinking coupled with effective strategic planning results in organizations that create new value in markets and have the flexibility to reallocate resources and strategy instead of sticking to predetermined plans of action that may quickly become outdated in changing markets. It allows an organization to respond rapidly to changes as, or even before, they occur, rather than struggling to keep up.
Increased research around strategic thinking as applied to management arose out of a rising complexity in organizations and markets that require managers, workers, and executives to view operations in a larger context than just a series of administrative tasks and functions. In the current economy, it is no longer efficient for an organization to only change once it is backed into a corner. Remaining competitive involves predicting future market trends and consumer needs and implementing strategic plans that help the organization to create that future. Strategic management no longer means fixing problems as they arise but instead having the skills to determine issues before they arise and implement solutions to avoid them.
These steps can be tried for practice, but as strategic thinking skills strengthen, many of these steps will happen simultaneously, continuously, or in a cyclical nature.
Traditional business strategy teaches that an organization should position itself in a market and then attempt to keep its hold on that position by acting within market forces. This sets up a dynamic of the organization being a stone in a river of market forces. New business strategy suggests that organizations and the individuals within them develop skills that will help organizations to be the river instead of the stone.
Developing strategic thinking skills requires getting comfortable with change and developing the ability to assess and analyze trends and patterns in constantly changing, complex situations and markets in order to extrapolate the most important information for decision making in any given moment. Strategic thinking is the process of being able to think in a big-picture context, gather and analyze data, and implement solutions based on that data with the ability to change methods as often as necessary. Adaptation and change should be a natural part of doing business rather than an occasional unexpected part.
Conducting SWOT analysis (strengths, weaknesses, opportunities, and threats) provides in-depth information on a system’s strengths, weaknesses, opportunities, and threats. The strengths and weaknesses are focused on the internals of the system, and the opportunities and threats are focused on the environment in which the system exists. A good analyst will prepare a SWOT analysis, even if it is a short exercise, and use the analysis to frame the boundaries for the IFR.