A business needs to have both a strategic plan and a budget. The strategic plan lays out the direction and goals of the business and guidelines for actions to achieve those goals, while the budget looks at the money needed to support achieving those goals. Budgeting is only one part of the strategic planning process.
Starting with a strategic analysis of the organization. Study strengths, weaknesses, and the economic, social, political and technical environment in which the business operates. Then decide what direction the business should head; this process may involve developing a mission statement or strategic philosophy and setting goals and identifying tactics or action steps for achieving strategic goals.
Focuses on goals the organization wants to achieve. Issue-based planning focuses on resolving issues the organization faces. The alignment model aims to ensure the organization’s mission, and it effectively aligned its resources in the organization’s operation. Scenario planning focuses on looking at situations the organization may face.
A forecast of all income and expenses helps a business identify future financial needs and plan based on expected profit, expenses and cash flow. If a business doesn’t have the budget to support its strategic plan, the business needs to either change its plan or find the financial means to support the plan.