The purpose of the formulation stage is to confirm that everyone is on the same page when "forming" the strategy. If the organization hasn't created a mission, vision, and values (MVV for short), this is the time. If the company already has an MVV, they should take time to confirm that everyone knows the MVV and interprets it the same way.

Some organizations will refine or redefine their MVV every so many years because their industry is changing rapidly. Your organization should do what works best for your situation. But don't ignore this portion to save money or time. Creating a business strategy is incredibly important. The last thing you want to do is create a strategy with participants not aligned toward the company's mission, vision, and values.