Since the purpose of strategic planning is to make basic decisions on the future course of the company, it is ultimately a responsibility of the CEO and his or her key lieutenants. In other words, top management cannot confine itself to perusing written plans and giving a perfunctory once-a-year approval. That would be abdication, not responsible delegation. To ensure that the right set of critical issues and decisions is in fact identified, top management must actively involve itself in the planning process. Even before the process of issue identification begins, the CEO should satisfy himself that the company’s financial targets are properly integrated.
Most companies today include some statement of financial objectives in their corporate plans. Surprisingly often, however, these objectives fail to take into account the inherent interrelationships among most financial targets. Sales, earnings, and return-on-investment targets, which are of course inextricably interlinked, often are set apart from each other in the manner of a diner ordering a meal at a Chinese restaurant: one from Group A, two from Group B. Since the objectives chosen are often inherently inconsistent and thus worthless if not actually debilitating, the result is frequently a case of strategic indigestion.