Strategic planning in businesses has evolved from a simple, linear process to a more complex, multi-faceted approach due to the rapidly changing business environment. Companies are now adopting a ‘palette’ of strategies, encompassing five distinct approaches: classical, adaptive, visionary, shaping, and renewal.

The classical approach, once the most popular, involves setting long-term goals based on predictions of future market conditions. However, its effectiveness has declined due to increasing market unpredictability. The adaptive strategy, on the other hand, focuses on short-term goals and constant adjustments to meet changing market conditions.

Visionary strategies involve creating new markets or drastically changing existing ones, often led by charismatic leaders. Shaping strategies are similar but involve multiple companies working together to create or reshape markets. Lastly, renewal strategies are used by companies in crisis, focusing on efficiency and cost-cutting to restore financial health.

Choosing the right strategy or combination thereof is crucial and depends on the company’s circumstances and the market’s predictability. While some businesses might benefit from a single approach, others may need to utilise several to weather different market conditions.

Go to source article: http://www.economist.com/news/business/21652318-choosing-strategy-lot-more-complex-companies-it-used-be-palette-plans