What makes your strategic plan effective is how it helps you make the right decisions. Your strategic plan sets the boundaries and guidelines for all your tactical decisions.
The 3 Step Strategic Planning Process:
The discussion phase is meant to gather as much information, opinions, and input as possible. Set up a regularly scheduled meeting with the employees and any other staff in your business who will be involved with strategic planning. Make sure you have an agenda and clear expectations of what you want to accomplish in each meeting. This will keep discussions on track and help prevent distractions. In the first few meetings, try to answer questions that will help you define the business’s current status, such as, “Where are we now?” and “Where are our competitors?” Once you have a good idea of where the business is, you can focus in on specific details in future meetings.
In addition to regular meetings with your employees at your business, you can also gather information from people outside your company, like vendors, investors, analysts. External people will have a unique perspective on not only your business, but also the industry you’re operating in. Getting their opinions on where they think the industry is going and what they think will change in the future can help you put together your strategic plan and determine where you want your business to be down the road.
You can also conduct a SWOT analysis. SWOT stands for strengths, weaknesses, opportunities and threats.
When you’re conducting a SWOT analysis, you and your employees will examine what your business does well, where it can improve, any future opportunities to pursue that could help facilitate growth and success, and any competitors or external factors that could prevent the business from succeeding.
After you’ve collected all of the information, it’s time for the development phase. This is when you’ll start putting together your business’s strategic plan. A strategic plan consists of five key components:
What’s your vision?
It’s crucial that you also establish your business’ vision. This is what you envision your company being in the future. Your vision should answer these questions:
Establish your company’s mission
Here is where you sit and write your company’s purpose in detail. Your company’s mission is a guide for your business’s daily operations. It’s also the starting point to make future decisions.
The mission statement should answer these questions:
When you’re creating goals and objectives for your business, make sure they’re clear, realistic and measurable. Work with your employees to create goals and objectives for at least the next one to three years. And discuss how these goals and objectives will be measured and tracked.
Not sure what goals to include? Here are some examples: increase sales and increase profits, offer new products and services, acquire new types of consumers, use digital platforms, improve online customer service, create a customer database, invest in employee education, improve employee retention.
Equally important is having an action plan to achieve these goals and objectives. If you’re trying to increase your sales by 10% in a year, you can pursue more marketing and social media outreach as part of your action plan. If an action plan doesn’t help your business achieve its goals, the plan needs to be rewritten.
A critical part of the strategic plan should address how often it will be reviewed and updated. Designate someone to be responsible for reviewing, updating, and sharing any changes with the rest of the company. Whether it’s you or another employee, you’ll want to make sure everyone in the business is aware of the changes and how they affect the overall strategic plan.
When you’re reviewing your strategic plan, you may find that you’re not on track to meet an objective or goal that you previously set up. Don’t panic. Reassess the situation and, if you need to, discuss the issues with your employees. Figure out what went wrong and why your business isn’t on pace; maybe the goal was too ambitious or not realistic. Change the goal or objective and update the action plan to help you get back on track. You also may find that your small business has met a goal or objective earlier than you thought you would. If so, you can create a new goal or objective to work toward, or try to maintain the progress you’ve already made.
Why Is Strategic Planning Important?
The strategic planning process can take some time, but it’s beneficial for everyone involved. As the small business owner, you’ll have a better idea of the organizational goals and objectives you’ll want to accomplish and a path to do that. For your employees, the process can foster an increase in productivity—contributing to the success of the business.