Strategic people management planning is the process of aligning an organization’s human resources with its strategic goals to ensure optimal performance and growth. Strategic people management planning involves forecasting future HR needs, developing policies, and implementing practices that support the organization’s mission and vision.
Research conducted by Harvard Business School in 2020 found that organizations with a strategic HR plan are 48% more likely to achieve their business goals compared to those without one.
To write a comprehensive management plan, start by developing a clear vision and mission statement. These foundational elements guide the direction and purpose of your HR strategies. Next, set specific, measurable goals that align with your organization’s overall objectives. A financial plan is also crucial, as strategic people management planning ensures that you have the necessary resources to implement your HR initiatives.
Poor planning or the absence of a strategic plan leads to several negative outcomes. These include misaligned goals, inefficient use of resources, high employee turnover, and ultimately, a failure to achieve business objectives. Therefore, investing time and effort into strategic people management planning is essential for long-term success.
Below are 22 Essential Steps for Strategic People Management Planning.
- Develop a Vision Statement
- Develop a Mission Statement
- Set Goals
- Set Major Initiatives
- Conduct Market Research
- Understand the Industry and Organization Context
- Perform Asset Management Planning
- Develop a Financial Plan
- Plan for Future Considerations
- Create a Customer Services Plan
- Define Performance Indicators
- Develop a Human Resources Plan
- Assess the Organizational Structure
- Map Out Key Performance Areas
- Identify Necessary Resources
- Create Goal-Related Tasks
- Assign Tasks and Timelines
- Establish Evaluation Methods
- Devise an Action Plan
- Prepare for Risk Management
- Implement the Management Plan
- Review and Adjust the Management Plan
1. Develop a Vision Statement
Developing a vision statement is defining the organization’s long-term aspirations. According to a 2023 Panmore Institute analysis of Tesla’s vision and mission, a strong vision ensures alignment between strategic goals and the organization’s aspirations.
A vision statement provides clear direction and inspires stakeholders. Try to involve key stakeholders in creating the vision statement to ensure engagement and alignment. Regularly review and update the vision to reflect market changes and evolving goals. Without a clear vision, a company risks losing direction and purpose, hindering long-term success.
2. Develop a Mission Statement
Developing a mission statement is defining the organization’s purpose and primary objectives. For example, analyzed by the Panmore Institute (updated October 3, 2023), Google’s mission highlights “organizing the world’s information,” aligning daily operations with its purpose.
A mission statement clarifies the organization’s purpose for employees and customers. Keep mission statements concise and focused on core values, and periodically review mission statements to maintain relevance. Without a mission statement, an organization risks losing focus and coherence, undermining the organization’s ability to achieve strategic goals.
3. Set Goals
Setting goals is defining specific, measurable outcomes that the organization aims to achieve. A 2022 Journal of Pharmacy Practice study found that patients using SMART goals (Specific, Measurable, Achievable, Relevant, Time-bound) showed clinically meaningful improvements, highlighting SMART goal’s effectiveness.
Goals align with the organization’s vision and mission, providing clear performance targets. Use SMART criteria to ensure goals are actionable and track progress regularly, adjusting as needed. Without clear goals, organizations risk stagnation and lack of progress, undermining long-term success.
4. Set Major Initiatives
Setting major initiatives is identifying significant projects or programs that drive strategic goals. IBM’s 2023 Annual Report highlights a $61.9 billion revenue, a 3% increase at constant currency, illustrating how focused initiatives contribute to growth.
Major initiatives allocate resources to high-impact projects. Prioritize setting major initiatives based on impact and feasibility, and monitor progress and outcomes regularly. Without major initiatives, organizations risk stagnation and lack of meaningful advancement toward strategic objectives.
5. Conduct Market Research
Conducting market research is gathering and analyzing data about customers and market trends. Procter & Gamble’s market research, as highlighted in a June 2011 Harvard Business Review article, facilitated successful product launches by aligning with customer needs.
Market research ensures strategic decisions are data-driven, offering insights into customer preferences and market dynamics. Use a combination of qualitative and quantitative methods and update research regularly to reflect market changes. Without market research, organizations risk making uninformed decisions, potentially leading to missed opportunities and misaligned strategies.
6. Understand the Industry and Organization Context
Understanding the industry and organizational context is analyzing the external and internal environments. Apple’s use of SWOT analysis, detailed in the Business Strategy Hub on June 24, 2024, highlights how identifying strengths, weaknesses, opportunities, and threats supports strategic alignment.
Understanding the industry and organizational context enables the identification of opportunities and risk mitigation. Conduct regular environmental scans and SWOT analyses, updating them to reflect changes. Without the industry and organizational context, strategies risk being misaligned with market and organizational realities, reducing the industry and organizational context effectiveness.
7. Perform Asset Management Planning
Asset management planning is managing organizational assets efficiently to support strategic goals. A McKinsey study reported that UtilityCo, a North American utility company, used advanced analytics in 2021 to reduce operating expenses by 20–25%, demonstrating the value of effective asset management.
Management planning optimizes resource use and minimizes costs. Develop a comprehensive asset management plan, and review and update the asset management plan regularly to ensure assets are utilized effectively. Poor asset management results in inefficiencies and higher operational costs, undermining organizational performance.
8. Develop a Financial Plan
A financial plan is an outline of an organization’s financial goals and strategies, serving as a roadmap for stability and growth. The National Council of Nonprofits highlights in “Your personal messages are end-to-end encrypted” that effective financial planning is critical for sustainability, particularly in non-profits.
Financial plans align resources with strategic objectives through detailed budgets, forecasts, and strategies. Regularly review financial performance and adjust the plan as necessary. Without a financial plan, organizations risk instability, misaligned spending, and hindered growth potential.
9. Plan for Future Considerations
Future considerations in management are anticipating trends and preparing for potential changes, enhancing resilience and adaptability. A TechFunnel study from August 14, 2024, demonstrated how scenario planning helps tech companies navigate uncertainties effectively.
Utilize scenario planning and trend analysis to stay proactive. Regularly update plans to reflect new information. Organizations that neglect future considerations will be unprepared for changes, risking missed opportunities or setbacks.
10. Create a Customer Services Plan
A customer service plan is a document that outlines strategies for delivering excellent customer service. McKinsey’s 2022 study, “The State of Customer Care in 2022,” found that companies focusing on customer care strategies experienced significant improvements in satisfaction.
Customer service plans boost satisfaction and loyalty by training employees and setting clear service standards. To boost the customer service plan, regularly assess customer feedback and adjust the customer service plan as needed. Poor customer service leads to dissatisfaction and customer loss.
11. Define Performance Indicators
Performance indicators are metrics that measure progress toward goals. A McKinsey study in 2022 found that KPIs improved productivity for a North American manufacturing company.
Performance indicators align performance with strategic goals, providing clear measures of success and areas for improvement. To implement performance indicators, select relevant KPIs and review them regularly to maintain relevance. Without performance indicators, measuring progress and success is challenging.
12. Develop a Human Resources Plan
Developing a human resources plan is outlining strategies for managing the workforce. A study by Oliver Wyman in July 2022 highlighted that effective retention strategies reduce turnover in the tech industry.
HR plans improve employee satisfaction and retention. To develop a human resource plan, include recruitment, training, and development strategies, and regularly review HR metrics. Without proper HR planning, turnover and low morale result.
13. Assess the Organizational Structure
Assessing the organizational structure is evaluating how the organization’s structure aligns with strategic goals. A study by BMC Health Services Research on August 10, 2022, titled “Organizational arrangements as a key to enhancing innovativeness and efficiency,” analyzed a restructuring hospital in Finland, highlighting that appropriate organizational arrangements foster innovation and efficiency.
Assessing the organizational structure enhances efficiency and communication. To assess the organization’s structure, conduct regular assessments and adjust processes, resource allocation, and training as needed. Without effective structure, organizational progress and efficiency will suffer.
14. Map Out Key Performance Areas
Mapping out key performance areas (KPAs) is identifying and prioritizing the critical aspects that drive an organization’s success. A study by Cascade, published in August 2023, emphasized that tracking and analyzing the right KPIs help retail businesses achieve their strategic goals, such as increasing sales.
Focusing on key performance areas provides a clear direction for improvement efforts. To implement mapping out key performance areas, prioritize areas like financial performance, customer satisfaction, and operational efficiency. Regularly review and adjust strategies based on performance data. Neglecting key performance areas results in missed opportunities for growth and improvement.
15. Identify Necessary Resources
Identifying necessary resources in management is finding the resources needed to achieve strategic goals. A study published in The Journal Buildings on February 19, 2024, analyzed a high-rise residential building project in Qingdao, China. The study found that applying the Takt-time planning method reduced project duration by 20.2%. Identifying necessary resources ensures that resources are allocated effectively to support strategic goals.
Identification of essential resources optimizes resource utilization and reduces waste. Try to conduct a thorough resource assessment and planning. Regularly review resource needs and adjust plans accordingly. Poor resource planning leads to inefficiencies and project delays.
16. Create Goal-Related Tasks
Creating goal-related tasks is breaking down goals into specific tasks. Creating goal-related tasks ensures that tasks are directly linked to achieving goals. A study published by ProjectManager in August 2022 found that implementing effective task management practices led to improvement in project completion rates.
The creation of goal-related tasks provides clear steps for achieving goals. To achieve goal-related tasks, use project management tools like Asana, Slack, and Smartsheet to organize and track tasks. Regularly review task progress and make adjustments as needed.
17. Assign Tasks and Timelines
Assigning tasks and timelines is delegating specific responsibilities to team members while setting deadlines to ensure timely completion. A study on Six Sigma implementation in a European engineering company from 2015 to 2022 highlighted how tasks were assigned based on team members’ expertise, and clear timelines were set to ensure project milestones were met.
Clear task assignments and timelines improve productivity and reduce delays. To assign clear tasks, use project management tools like Trello or Asana to assign tasks, track progress, and ensure deadlines are met. Regular check-ins help keep teams on track, while timely reviews allow for adjustments if any challenges or scope changes arise. Without clear task assignments and timelines, projects face delays, confusion, and inefficiency, ultimately hindering progress. Effective task assignment and time management naturally lead to the need for evaluation methods to measure progress and success.
18. Establish Evaluation Methods
Establishing evaluation methods is setting clear criteria and processes to assess the effectiveness of tasks and overall project progress. Evaluation ensures that outcomes align with strategic goals and provides data-driven insights for decision-making. For example, in the fashion industry’s 2021 implementation of a Product Lifecycle Management (PLM) system, evaluation methods were put in place to measure the system’s impact on production efficiency and product quality.
Effective evaluation methods improve project success rates and offer valuable feedback for continuous improvement. To implement evaluation methods, use key performance indicators (KPIs), regular performance reviews, balanced scorecards, benchmarking, and SMART criteria to track progress. Regularly refine evaluation methods based on feedback and evolving organizational needs. Without proper evaluation, critical performance issues will go unnoticed, increasing the likelihood of project failure. Once evaluation methods are established, a comprehensive action plan is needed to guide effective project execution.
19. Devise an Action Plan
Devising an action plan is outlining the steps, resources, and responsibilities needed to achieve project objectives. Devising an action plan ensures that all activities are aligned with the organization’s strategic goals and provides a clear roadmap for success. For example, in a study by the National Academy of Medicine in 2020, an action plan was created to implement evidence-based practices, specifying actions, responsible parties, and necessary resources.
A well-structured action plan improves project coordination and ensures efficient resource utilization. To devise an action plan, break the action plan into manageable tasks, assign them to team members, and use tools like Gantt charts to visualize the project timeline. Regularly review and adjust action plans based on progress and feedback. Without an action plan, projects lack direction, leading to resource wastage and missed deadlines. Once an action plan is in place, preparing for potential risks becomes the next crucial step.
20. Prepare for Risk Management
Preparing for risk management is identifying potential risks and developing strategies to mitigate them. Effective risk management ensures that potential obstacles do not derail the organization’s strategic goals, maintaining project momentum.
In the implementation of a Six Sigma project at Toyota in 2023, risk management strategies were developed to address potential quality issues and process disruptions. Proactive risk management reduces project risks and improves overall project resilience. Conduct a risk assessment to identify potential risks and develop contingency plans.
To prepare for risk management, use risk management software to track and manage risks. Continuously monitor risks and update risk management plans based on new information and changing circumstances. Without risk management, projects are more vulnerable to unexpected issues, leading to an increase in project disruptions. Implementing the management plan effectively requires integrating all previous steps and ensuring seamless execution.
21. Implement the Management Plan
Implementing the management plan is executing the action plan and managing resources to achieve project objectives. For example, a 2024 study on the implementation of a Product Lifecycle Management (PLM) system at 3M, detailed in a guide by Propel Software, emphasizes best practices such as coordinating activities across departments and ensuring resource availability.
Effective implementation ensures that all project activities are directed toward achieving the organization’s strategic goals. By using project management software, progress will be tracked, and resources will be managed effectively. Regular team meetings help address issues promptly and keep the project on track.
Monitoring the implementation progress and adjusting the plan as needed is essential for maintaining momentum. Without proper implementation, projects risk delays, resource shortages, and reduced success rates. Regularly reviewing and adjusting the management plan ensures continuous improvement and adaptability, ensuring that the project stays aligned with evolving needs and circumstances.
22. Review and Adjust the Management Plan
Reviewing and adjusting the management plan is evaluating project outcomes and making necessary changes to improve future performance. Regular reviews ensure that project outcomes align with strategic goals and provide opportunities for continuous improvement.
In a study on Six Sigma implementation at a European engineering company from 2015 to 2022, regular reviews and adjustments were made to the management plan based on performance data and feedback. Regular reviews improve project performance and ensure lessons learned are applied to future projects. Schedule regular review meetings to evaluate project progress and outcomes.
To review and adjust the management plan, use feedback to make necessary adjustments to the management plan. Continuously review and adjust the management plan based on evolving internal and external factors. Without regular reviews, projects fail to adapt to changing circumstances, leading to a decrease in overall project effectiveness.
How to write a management plan?
To write a management plan, use a structured approach with key components: a scope statement defining objectives and boundaries, critical success factors outlining what’s needed for success, and deliverables specifying expected outcomes.
Include a work breakdown structure to organize tasks, and ensure a schedule and budget for time and financial feasibility. Quality management, resource management, and a communication plan are essential for maintaining standards, allocating resources, and ensuring clear communication. Finally, a risk register and procurement plan help identify risks and manage external resources.
How do you establish company goals in a management plan?
To establish company goals in a management plan, you set clear, measurable, and achievable objectives that align with the company’s vision and mission. Use frameworks like SMART (Specific, Measurable, Achievable, Relevant, Time-bound) to ensure goals are well-defined and trackable.
Involve employees in the goal-setting process to boost motivation and commitment, improving performance and goal attainment. A 2020 study by Locke and Latham, “Building a Practically Useful Theory of Goal Setting and Task Motivation,” shows that companies with well-defined goals are more likely to succeed, as these goals guide decision-making and resource allocation.
Why is planning an important part of people management?
Planning is an important part of effective people management strategies because planning provides a structured approach to achieving organizational goals and efficiently utilizing resources. Planning requires setting objectives, determining actions to meet them, and allocating resources effectively.
Planning aligns individual and team goals with organizational objectives, optimizes resource use (time, money, personnel), and helps anticipate challenges, developing strategies to mitigate risks. Planning also offers a framework to measure performance, identify areas for improvement, and address employee training and development needs.
Does every business need a management plan?
Yes, every business needs a management plan. A management plan provides a structured framework to achieve goals, streamline operations, and allocate resources efficiently. A management plan helps identify risks, set clear objectives, and establish accountability, improving decision-making and business performance.
A Harvard Business Review study found that companies with well-defined management plans are more likely to achieve strategic goals. Businesses with comprehensive plans see higher employee satisfaction and retention, as clear guidelines foster an organized, supportive work environment.
Is the management plan the same as a business plan?
No, a management plan is not the same as a business plan. A business plan outlines the overall strategy, goals, market analysis, financial projections, and operational plans for a business. A business plan serves as a roadmap for the business’s future and is used to attract investors or secure financing.
While a management plan focuses on the organizational structure, roles, responsibilities, and internal processes within the business. While a management plan is a component of the business plan, a management plan specifically addresses day-to-day management practices, leadership hierarchy, and staffing. The U.S. Small Business Administration (SBA) emphasizes that the business plan covers the entire business strategy, while the management plan targets internal management processes.
Can poor planning lead to management failure?
Yes, poor planning can lead to management failure. For example, the Denver International Airport project in the 1990s suffered significant delays and cost overruns due to poor planning. Initially estimated to cost $2.8 billion and open in October 1993, the airport opened in February 1995 at a final cost of $4.8 billion. Similarly, the 2012 London Olympics faced challenges due to underestimated security needs, leading to last-minute changes and increased costs. The Denver International Airport and London Olympics cases show how inadequate planning results in missed deadlines, budget overruns, and scope changes, ultimately jeopardizing management success. Proper planning is crucial for setting goals, allocating resources, and managing risks to ensure projects are completed on time and within budget.
What are the risks of running a business without a management plan?
The risks of running a business without a management plan are:
1. Lack of direction: Without clear goals and strategies, inefficiencies and wasted resources are common, leading to poor decision-making and missed growth opportunities.
2. Financial instability: Inaccurate budgeting and financial projections disrupt timelines, strain inventory, and compromise cash flow.
3. Operational disruptions: The absence of a structured approach makes responding to market changes and internal challenges difficult, affecting performance and sustainability.