Strategic planning: The key to growth and profit
Small business owners are often confused about the difference between a strategic plan and a business plan. Strategic planning is like making a roadmap to achieve the goals you spelled out in your company’s business plan.
A strategic plan is the Who, When, and How to your business plan’s What and Why.
It lists the steps and market strategy that your company will take in order to meet the goals in your business plan.
Strategic planning advice from those who’ve been there
It helps to know what to expect when starting any important task. Keep these tips in mind as you plan.
- Take your time.
- Prioritizing is key.
- Build advantage in the marketplace.
After you read our tips, keep going to learn the business benefits of strategic planning.
Map your path to success
Simply explained, a strategic plan zeroes in on one or more objectives and lists the short- or long-term timelines required to reasonably achieve these goals.
Once you’ve identified the steps from here to there, you then formally pair these tasks with the skills of the employees within your company.
Matching the conceptual tasks you’ve set out with the real-world competencies of your staff is the heart and soul of an effective roadmap. By assigning them to individuals or teams, you increase the likelihood of reaching your goals.
A few words of advice as you start your strategic planning process:
1. Take your time
Do your research and your due diligence. Learn all you can about your industry and the geographic areas where you’ll be operating so you can create some realistic scenarios to challenge your vision.
Start by analysing your current set-up for weaknesses as well as strengths, including:
- Operational procedures
- Communications protocols
- Employee strengths and deficits
- Technological needs
- Management structures
Then apply this insider information to a series of stress tests of as many realistic scenarios you can conceive of. What you learn from this will help you predict how your company would fare in each scenario.
2. Prioritizing is key
Never disregard the negative outcomes of your scenario testing — in fact, this is where the most useful information for your strategic plan will come from!
Knowing what areas of your company are most likely to fail during times of growth or challenge, will help you know exactly where to focus your time, energy and money to shore up your business.
Your strategic plan will help you prioritize the things your company will need as you begin to hit smaller goals on the road to the bigger ones.
Communication is key here. When everyone involved in the running of the business is made aware of the goals, timelines and methodology you intend to use, your team will work more intelligently.
3. Build advantage in the marketplace
Use the positive and negative results from your stress tests to modify your strategic plan to meet challenges proactively.
This will build advantage in the marketplace, as a prepared company is a resilient company.
Though negative stress test results can be daunting at first, anything that helps you refine your initial blueprints can only be a good thing. Ultimately, thoughtful strategic planning will make your business stronger and more responsive to market forces.
Benefits of strategic planning
One of the main benefits of using this type of planning is that it prevents your company from wasting time and resources on the trial-and-error approach.
Reacting to every bump and curve the market throws your way without having a method worked out in advance proves two points:
- Your company will waste considerable money, time and energy reacting instead of being proactive
- That your business will soon find it hard to keep talented employees when they realize there’s no plan to deal with surprises
Having a plan is the best way to harness the creative and analytical energy of your staff.
It helps manage growth
Executing a well-thought out business strategy in a timely way tends to build momentum amongst staff as well as within your customer base.
Having processes in place to run the business on a daily basis leaves ample creativity and energy for the times when unforeseen events or forces require an immediate response.
Smarter use of resources
A comprehensive strategic plan helps you put your money where you will get the best bang for your buck. For example, networked computers might be a better investment than laptops if your company has listed stationary outlets as a part of your strategic plan.
As well, hiring choices can be greatly influenced depending on the types and depth of expertise your company will need to meet its goals. For example, the choice between a software product or a human expert may become clear once you review your strategic plan.
Strategic planning is action planning
Knowing where you are and where you want to go just isn’t enough to be competitive any more.
In today’s marketplace you need to have an action plan that will help your company move from here to there — no matter what. By using the strengths and skills you already have to meet expected and unforeseen challenges, strategic planning can help you succeed over the long term.
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