Strategic is a process of review and planning which is undertaken to formulate thoughtful decisions on an organization’s future with an aim of making it successful. This process involves a clear definition of the organization’s mission and undertaking an assessment of its competitive landscape and current state. It also requires an operational plan that is well-thought on how to appropriately allocate human capital, time and financial resources within such an organizational integration. Strategic planning points out the significance of making decisions which will make sure that the organization has the ability to respond to changes in the environment effectively.
Long Range Planning
Long range planning is an inwardly fixated look at the organization’s objectives and goals. For instance, it is the assumption of the present knowledge about the future conditions. It emphasizes on making certain the plan’s exact results over the time of its implementation.
Budgeting is a process of creating a plan to spend money. This process of instituting a spending plan allows for prioritizing in advance on which activities should be chosen for a future time period with the available financial resource.
Budgeting is concerned with capital, expenditures and investments. It determines the best use of capital to implement the long range planning. This is by determining if and to what extent to spend on each operation or activity. Budgeting matches the revenues against investment and expenditure. It has no time limit but can be done for a week, part of a year, a year or even five years (Hagel, 2014).
The focus of a budget is on taking care of day-to-day operating needs where as long term planning focuses on allocating resources efficiently, making long-range plans for new funds, and ensuring that funds are directed toward goals and priorities of a strategic plan that is well thought out in advance, implemented and followed (Donnelly, 2006).
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