Key Takeaways
- The phases of strategic planning use different time horizons for tactics, strategy, and vision.
- Use research and data to guide future decisions.
- Revisit plans regularly as trends and conditions change.
- Align teams and resources to turn strategy into action.
In the face of uncertainty across industries such as oil and gas, automotive, manufacturing, and robotics, planning for the future can be challenging and overwhelming. So, how do you plan for the future using research and data rather than guesswork? How can you understand the phases of strategic planning and their usual time horizons? More importantly, how can strategic planning support your business’s long-term sustainability?
In this article, we show you how to plan beyond assumptions and arbitrary forecasts. We guide you to understand that research on trends, innovation, and data analysis should often be revisited as part of your planning.
At Taylor Wells Advisory, our consulting experience shows that research-led planning across pricing, products and services, and marketing can help businesses prepare for future opportunities and risks.
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The changes business leaders need to address can unfold over very different time horizons, from shifts in global trade to technological innovation.
This can create a gap between forecasts and the research or data available at the time. Long-term planning can also be difficult because uncertainty increases as the planning horizon extends.
However, important business challenges do not always align with fixed dates or predetermined planning horizons. Organisations need to evolve and take action as new challenges and opportunities emerge.
Businesses that rely on short-term solutions may become reactive rather than proactive when external pressures emerge.
What Is the Main Purpose of Strategic Planning?
Strategic planning is quite different from a business plan. Strategic planning involves setting goals for your organisation over a longer-term horizon and identifying the actions needed to achieve them. You must identify the actions that you need to take to achieve the goals you’ve set. You also need to review your current operations and assess whether your priorities align with your longer-term direction. Specifically, you will want to know where you are, where you want to take your company, and what you can do to get there.
Phases of Strategic Planning: How Do Planning Horizons Differ?
This approach uses different planning horizons for different levels of planning:
| Planning Level | Time Horizon | Main Focus |
| Tactical | ~2 years | Likely developments, immediate priorities and risks |
| Strategic | 2–5 years | Resources, investment and broader priorities |
| Vision | 10–15 years | Long-term direction and possible future scenarios |
| Evolution | Beyond 10 years | Ongoing adaptation as conditions change |
The key idea is a time cone: as the planning horizon extends, uncertainty increases. Tactical plans therefore focus on what is more predictable, while strategic plans and long-term vision account for a wider range of possible outcomes.
Where Is Your Business Today?
This question establishes where your company is today. It includes every aspect of your operations, from profitability and key value drivers to team culture and how you’re faring against competitors.
Where Do You Want to Go?
This requires you to consider your vision, mission, values, and long-term objectives. You need to identify your competitive advantage and clarify your strategic focus.
In some cases, a time cone can be more useful than a linear timeline because it shows how planning changes as uncertainty increases.
How Will You Get There?
Getting there requires changes to your team structure, pricing, sales, and marketing functions. Teams should also work across functional silos. Cross-functional collaboration between sales, pricing, finance, and marketing can help management make better-informed decisions.
You should also set deadlines for when you expect to achieve your goals. There should also be evaluation tools or metrics available that measure the success of your efforts or activities. Then, you can use the information to analyse the biggest weaknesses or challenges you’re facing at the moment and which areas you can improve.
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Tactical Planning: The 2-Year Horizon
Tactical planning focuses on the next 2 years, using recent research and data to act on likely developments. Businesses should identify where they want to succeed, what risks they need to mitigate, and which actions are most likely to support their immediate priorities. Set clear deadlines and metrics so you can assess progress and adjust your plans as conditions change.
Failing to set clear priorities and measures can leave businesses reactive, making it harder to respond to market disruptions and maintain their competitive position. It can also leave them more exposed to other global crises.
Strategy: The 2–5-Year Horizon
As your business moves beyond the 2-year tactical horizon, strategy focuses on the 2–5-year period and helps determine where resources and investment should be directed. At this stage, future outcomes become less predictable, so strategic decisions should account for a wider range of possible scenarios.
Vision: The 10–15-Year Horizon
Defining a vision over a 10–15-year horizon requires tactical and strategic plans to be revisited as trends and conditions evolve. These decisions should be informed by research into emerging technologies, innovation, global trends, and economic conditions.
Management teams should also invest in the skills, capabilities, and talent they will need as the business evolves. This will help support the organisation’s ability to adapt to changing market trends and technology.
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Evolution: Planning Beyond 10 Years
Although outcomes become increasingly difficult to predict over a 10–15-year horizon, ignoring longer-term planning can leave businesses reacting to market changes rather than preparing for them. Focus on where you envision the company moving over the longer term, while recognising that assumptions will need to change as new information emerges.
Start with current research, trends, and developments, then use this evidence to inform decisions across each planning horizon.
Example: Planning Across Different Time Horizons
The development of smartphones illustrates why businesses need different planning horizons. Early mobile devices introduced features such as email, touchscreens, and mobile internet access that later became common in smartphones. However, the long-term commercial impact of these technologies was difficult to predict.
A time-cone approach helps businesses separate what they can act on now from what remains uncertain. Over a shorter horizon, teams can use current research and customer behaviour to make tactical decisions. Over a longer horizon, they can consider how emerging technologies and changing customer expectations could affect their products, services, and competitive position.
The lesson is not to predict exactly what technology will look like in 10 or 15 years. Instead, businesses should identify plausible developments, monitor new evidence, and adjust their plans as uncertainty decreases or new opportunities emerge.
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Bottom Line
Time cones can help businesses visualise different planning horizons while accounting for uncertainty. Each planning horizon should be reviewed and adjusted as new information becomes available. This may include redesigning operations and processes, collaborating with new partners, and recruiting the right talent.
To adapt within each time horizon, businesses need flexible decision-making and the right skills and experience across research, development, pricing, marketing, and sales teams.
Market developments and customer behaviour can also help businesses identify emerging trends and adjust their plans accordingly. This allows businesses to respond with greater control and adaptability instead of basing decisions on arbitrary 5- and 10-year intervals. Ultimately, regularly reviewing short-term and long-term plans can help businesses remain resilient as market conditions change.
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Are you a business in need of help to align your pricing strategy, people, and operations to deliver an immediate impact on profit?
If so, please call (+61) 2 9000 1115.
You can also email us at team@taylorwells.com.au if you have any further questions.
