As is the case with many things in life — beating your friends at Settlers of Catan, getting your shopping done quickly — a good strategy helps guide you through to completing any goal.
Starting up a new business is exhilarating and it’s tempting to jump in and get going. However, it’s important to take the time to pull together a business strategy. Because every winner knows that not having a strategy is a strategy in itself: a losing one.
How to approach the business planning process
There are three important steps in setting yourself up to write a solid business strategy:
Get ready to write
You may have a bunch of great ideas floating around in your head. Good. Now write them down.
Real business is done on paper — or in Microsoft Word, a Google Doc or whatever. Sitting down to solidify a business strategy will help you legitimize your business. It will also help you create a great reference document to share with potential partners, investors or vendors.
Get input from others
Although you are the one leading the business planning process, there is strength in collaboration. Your friends, colleagues or business partners may have different insights based on their life experience and expertise. Interview them and incorporate their perspectives into the strategy where appropriate.
I’d also recommend that you tap into your network.
Anyone with business acumen can act as a great mentor.
Use resources for Canadian entrepreneurs
In cities across Canada, there are organizations such as business improvement associations (BIAs), chambers of commerce and startup organizations (even communities like Fuckup Nights) that provide resources to new businesses and help you grow your network.
Use the strong spirit of the entrepreneurial community to your advantage.
6 essentials in any business strategy
When you’re ready to start writing, there are many different planning formulas you can follow. While any one of them might provide a great framework for your business strategy, there are a few best practices.
1. Your business’ vision
Terms like “vision” and “mission statement” can sound a bit like corporate jargon, but there is a good reason that many businesses have them.
A vision is an image of what you want your business to be at some point in the future.
A business can’t be everything to everyone, and a well-defined vision can be something you point to when faced with a difficult decision.
2. Short-term and long-term goals
Now that you have a vision, you can break it down into activities that will help make it a reality. The time period you set for your goals can depend on a few things, like how new your business is and how quickly the market changes. Is it seasonal? Is your product subject to technological disruption?
Try to make your goals SMART: an easy-to-remember acronym that stands for specific, measurable, attainable, relevant and timely. Having loosey goosey goals isn’t going to get you too far.
3. A SWOT analysis
You want another acronym? You got it! SWOT stands for strengths, weaknesses, opportunities and threats.
A SWOT analysis is a matrix that is used to get a handle on the internal things about your business (strengths and weaknesses) as well as the external factors (opportunities and threats) that are typically out of your control. Even if you just have a few bullet points for each quadrant, that’s a good start.
4. A competitive analysis
Differentiation is a huge part of business success.
What makes your business special? The first step is to see what everyone else is doing. So using the step-by-step instructions here, do a competitive analysis. This can reveal everything from who your top competitors are to what they’re not doing very well that you could do better.
Monitoring what the competition is doing will give you the edge your business needs to thrive.
5. A Business Model Canvas
If you consider yourself more of a visual learner, I’ve got just the thing for you. It’s called the business model canvas. This template, which guides you through tasks like describing the customer relationships and key activities you plan on doing, will help you create a well-rounded picture of your business.
6. Your target market(s)
No matter how great your product or service is, it’s not for everyone. You need to do some research to determine what segments of the market are the best fit for your business.
Where is there currently a gap that you can fill? How does this market segment behave? What do they like? What do they respond to? Where do they live? Do your customers listen to CBC during their morning drive in, or the latest podcast episode of Getting Curious with Jonathan van Ness?
If you want to learn more, the Government of Canada provides resources to learn more about your industry, as well as current and potential customers, competitors and markets.
A note on business adaptability
After you’ve completed the first version of your business strategy, give yourself a pat on the back. Then, put regular reminders in your calendar to review and revise. No matter what tool you used to write your business plan, I doubt you decided to etch it in stone. So you are able to go back in and edit it as needed, based on developing trends, market changes and the changing scale of your business.
A little planning goes a long way
I’m sure as you’re running around putting out one fire after another, you’ll thank yourself for taking the time to put some thought into the long-term vision for your business. When creating a business strategy, remember to:
- Consult others in the business planning process.
- Include any components that will help flesh out your business.
- Revise your plan regularly.
The business strategy you’ve created can help keep you grounded and bring you back to what value your business is providing and its reason for existing. Not to mention, it can be a good reminder of what sets your business apart from the competition.