A strategic plan for your business gives you the power to focus your efforts, target your investment and align your team as we forge ahead. Whatever your business may be, and whatever your goals are, your team must row in sync with team members having thorough knowledge of company priorities.
At this time of year, it’s essential to work off a single set of objectives. And yet, we find time and time again that too many businesses fall short in this regard. Some simply undertake a budgeting exercise toward year-end, while others don’t do any planning, and as a result, lack goals for the fiscal year.
The benefits of a strategic plan are multi-faceted and benefits your organizations with:
- allowing your company to be proactive vs reactive
- providing a “sense of direction” for your company and employees
- setting the stage for “operational efficiencies”
- providing direction, vision, and durability especially in tumultuous times (most importantly)
Few executives can maintain meaningful touchpoints with everyone in their organization once it grows larger. Once you get beyond 20 or 30 employees, you need to guide employees in other ways beyond action-oriented tasking (i.e., do this, do that). If you want employees to be proactive in customer/client service, how can they do it if they don’t know what the company’s priorities are—or if those priorities don’t exist?
For example, have you decided which customers are your more important customers—i.e., customers you want to increase focus on and increase revenue from? Is it more important to grow existing customer relationships, or pursue new ones? Are your customers seeking new products and services from you or from your competitors?
A solid strategic plan will help you answer these and other questions, and position your business for success. It doesn’t need to be complicated, multifaceted or occur through long meetings over weeks or months. Rather, it unfolds in a three-step process:
- Decide what your organization’s top (i.e., 3-5) priorities are for the coming year, and clearly articulate them in writing. It’s worth noting that this planning should involve key staff responsible for operations throughout your organization. Great ideas aren’t developed in a vacuum. Your people are immersed in your business; they know what works, what doesn’t, where opportunities may lie, and where pitfalls reside. It’s also vitally important to leverage data in this effort—be it internal or external. To achieve these goals, make sure you identify the high-level steps and the people that will be responsible for them.
- Determine appropriate measures of success. Whatever your priorities may be (e.g., grow, cut costs, bring new products or services to new markets), figure out how you’ll measure success. Is it by applying quantifiable percentages to initiatives? Introducing one new product? Five? Ten? Likewise, if you want new customers, what do they look like? Are they more important than your current customers? Do they live in different industries than customers you currently serve? As part of this effort, you should have a baseline of knowledge for where your business currently resides. If you’re already growing by, say, 3 percent, and you seek 10 percent growth, you need to increase your current growth performance by 7 percent.
- Communicate those priorities to everyone in your organization so that everyone understands them and acts in concert.
As you undertake strategic planning and determine your annual goals, keep the following in mind:
- Objectives are key – You can’t do everything; a business growth plan should prioritize and focus your organization. In that regard, it should address core issues your business faces, and position it to meet both internal and external objectives. As Steven Covey mentions in the “7 Habits of Highly Effective People,” spend your time on the important and don’t get distracted with the urgent.
- Prioritize – Many organizations fail by taking on too many initiatives. Limit your objectives to 3-5 at most. Focus on the first one and when that is complete, work on the next, then the next.
- Simplicity and brevity rule – Your plan is a growth strategy—that needs to be conveyed throughout your organization simply and clearly. Therefore, no matter the size or scope of your business, you should strive to encapsulate the essence of your plan on a single page. It should concisely articulate the business’ objectives, initiatives, responsibilities and metrics.
- Don’t forget what makes you different – In other words, what causes you to stand out to your customers, and why your business will create greater value for your customers.
Without a clear plan, without getting buy-in from your team, and without accurate measures of success, you’ll end up somewhere…but it’s probably not where you’d like to be. Conversely, by implementing some basic strategic planning, and using the steps outlined above, you’ll have a clear destination, and a roadmap to get you there. In the end, your plan should reconcile your aspirations with marketplace and organizational reality to arrive at a sweet spot where growth and profitability are realistic and achievable.
We Are Here to Help
Do you have questions about strategic planning for your business, or other business growth issues? Please contact a member of our Virtual Financial Consulting – Outsourced (VFCO) department. Our team is here to help you.