Strategic planning is a widely adopted management approach in contemporary organizations. Underlying its popularity is the assumption that it is a successful practice in public and private organizations that has positive consequences for organizational performance. Nonetheless, strategic planning has been criticized for being overly rational and for inhibiting strategic thinking. This article undertakes a meta-analysis of 87 correlations from 31 empirical studies and asks, Does strategic planning improve organizational performance? A random-effects meta-analysis reveals that strategic planning has a positive, moderate, and significant impact on organizational performance. Meta-regression analysis suggests that the positive impact of strategic planning on organizational performance is strongest when performance is measured as effectiveness and when strategic planning is measured as formal strategic planning. This impact holds across sectors (private and public) and countries (U.S. and non-U.S. contexts). Implications for public administration theory, research, and practice are discussed in the conclusion.
Evidence for Practice• Strategic planning has a positive, moderate, and significant impact on organizational performance in the private and public sectors, across international settings. • The findings suggest that strategic planning should be part of the standard managerial approaches in contemporary organizations and contradict many of the critiques of strategic planning. • The formality of the strategic planning processes (i.e., the extent to which strategic planning includes internal and external analyses and the formulation of goals, strategies, and plans) is important to enhancing organizational performance. • Strategic planning is particularly potent in enhancing organizational effectiveness (i.e., whether organizations successfully achieve their goals), but it should not necessarily be undertaken in the hope of achieving efficiency gains.