Definition: A systematic process of envisioning a desired future, and translating this vision into broadly defined goals or objectives and a sequence of steps to achieve them. 
Working backward: In contrast to long-term planning (which begins with the current status and lays down a path to meet estimated future needs), strategic planning begins with the desired-end and works backward to the current status. At every stage of long-range planning the planner asks, “What must be done here to reach the next (higher) stage?” 
Tactical planning: In contrast to tactical planning (which focuses at achieving narrowly defined interim objectives with predetermined means), strategic planning looks at the wider picture and is flexible in choice and means. 
Strategic topics: There is not one defined list of strategic topics that an owner of a privately-held company should consider for strategic planning. This article mentions a few strategic topics but is not meant to be a finite list of the subject matter. The following are not listed in an order of priority.
Market trends: Strategic plans often consider the ever-changing market trends of the consumer. For example, at the time of writing this article, many “big box” companies are in financial difficulty, such as Sears, Target, JC Penny, etc. Others have recently filed for bankruptcy or have closed their doors, such as Sports Authority, Golfsmith, Sport Chalet, etc. The financial difficulty of these companies happened, in part, to not moving fast enough with the consumer market, which likes to do a lot of its shopping online. Conversely, it was reported that Walmart’s 2016 fourth-quarter online sales grew by 29% from a year ago. Walmart seems to have a strategic plan to move with the market with on-line sales.
Competition trends: Strategic plans often consider the future trends of a company’s competitors. It is management’s responsibility to know what the competition is doing and to strategically plan for their changes in technology, software, cost-reductions, creation of new product lines, research and development, etc. For example, might traditional home builders consider watching its competitors who are building new types of dwellings to accommodate the “millennial” generation, who do not want to purchase homes but also do not want to live in typical high-rise apartment complexes? What are the home-buying or renting desires of these millennials and do their desires also coincide with retiring the baby-boom generation?
Buy-sell agreements: Many privately-held companies have more than one owner. If so, strategic planning calls for time to be spent in the event that one owner might exit the company by death. Otherwise, the remaining owner(s) might find themselves in the situation of working with a new owner, such as the spouse, children or other family members of the deceased co-owner. A detailed buy-sell agreement should be considered along with adequate term life insurance to purchase the shares of the deceased owner on a pre-tax basis.
New customers: Succession plans sometimes consider new or different types of future customers. This planning should make time to beta-test the new types of customers to help make sure the plan is proceeding in the right direction.
The IRS: Regrettably, many owners of privately-held companies die prematurely. An unplanned premature death may cause serious consequences to the owners’ business and family members. The IRS will require their pound of flesh from a company that has value by what is commonly known as the “death tax” (Estate taxes on the transfer of the estate of a deceased person in excess of exclusion amounts). Below are two highly visible examples of this topic that should be considered in the strategic planning in every company.
Miami Dolphins: Joseph “Joe” Robbie was the original owner of the NFL football team, the Miami Dolphins (1966-1990). Coached by Don Shula, Robbie’s Dolphins achieved a perfect season (17-0) in 1972 and two consecutive Super Bowl wins. When Joe Robbie passed away in 1990, his family had to sell the franchise (in 1994) to pay a reported $47 million in estate taxes. Robbie’s estate was somewhat less than $100 million and almost 50% of it vanished in federal estate taxes. It compelled his family to sell the Dolphins at a fraction of its value. Strife and bitter resentments developed within the family because of the actions they had to take to pay the taxes. The real tragedy is that it all could have been avoided. If that $45 million could have been paid with a life insurance check, concluded Financial Planning (magazine), it would have certainly changed the financial complexion of the family’s situation. (The Exit Strategy Handbook, fourth edition, pp. 134-135).
Chicago Cubs: The Wrigley family had to sell the Chicago Cubs to pay taxes that came due upon the death of two members of the family. (The Exit Strategy Handbook, fourth edition, p.135).
Succession plan: An owner might consider in the company’s strategic planning if the company is to become a legacy company, meaning that it will continue with its name, management and operations after the owner is no longer involved. Much time might be needed in strategic planning to determine how the company might function without the current owner.
Next generation owners: Some strategic plans revolve around succession planning. If so, the topic of the next generation of owners needs to be carefully planned. It might take years of training for the next generation of owners. They might need to work outside of the company for a few years in order to learn leadership, management or other skills necessary to become the future leaders of the owners’ current company.
Cash or capital: Strategic plans might include the estimated amount of cash or working capital needed, including the sources of the cash.
Board of Directors: A company might consider hiring a Board of Directors or an Advisory Committee in order to obtain outside knowledge for its strategic plans. This is sometimes a quick way to receive some outside advice and input on the plan.