Creating a strategic plan is a key component of planning for growth and one that I help our clients to deliver so they have clarity of direction in their business. Done correctly, it will help prepare a realistic vision for the future of your business and will help you to maximise your potential for growth.
A strategic plan is not a business plan. A business plan is about setting short or mid-term goals and defining the steps necessary to achieve them. A strategic plan is typically focused on mid to long-term goals for your business and explains the basic strategies for achieving them.
The purpose of strategic planning is to set overall goals for your business and to develop your plan to achieve them. It involves stepping back from your day-to-day operations and asking where your business is headed and why it is heading that why, then we work together to develop what the priorities should be.
Strategic planning and growing businesses
Taking the decision to grow a business means embracing the risks that come with growth and this is exactly what a super successful entrepreneur does. They will spend time identifying exactly where they want to take their business – and how they will get there.
When you decide to peruse a strategic growth plan and when you start to implement the measures highlighted in your strategic plan your business will become larger and more complex. At this point strategy formulation will need to become more sophisticated. To do this, you will also need to start collecting and analysing a wider range of information about your business – both about how it operates and about how conditions are developing in your current and potential markets.
The difference between strategic planning and writing a business plan
The process of strategic planning is about determining the direction in which you want to take your business. By contrast, the purpose of the business plan is to provide the detailed route map that will take you in your desired direction.
Effective strategy development requires you to shift your focus from the day-to-day concerns of your business and to consider your broader and longer-term options. This is the first step that an entrepreneur will take en route to becoming a super successful entrepreneur – you need to stop doing and start managing.
The three key elements of strategic planning
Developing a strategy for business growth requires you to deepen your understanding of the way your business works and its position relative to other businesses in your markets. We start to get an understanding of this through a detailed audit of your business. But, as a starting point, you can ask yourself the following three questions:
Where is your business now?
This involves understanding as much about your business as possible, including how it operates internally, what drives its profitability, and how it compares with competitors. We get involved at this level as most owners can not detach themselves from their business. To get a true picture and obtain the most value at this stage you need to be realistic, detached and most importantly, critical.
Where do you want to take it?
Here you need to set out your top-level objectives. We work with you to help you work out your vision, mission, objectives, we find out your values, analyse your business techniques and see how well these all align to you business goals.
Crucially, you need to know exactly where you see your business in five or ten years time? What do you want to be the focus of your business and your source of competitive advantage over your rivals in the marketplace?
What do you need to do to get there?
What changes will you need to make in order to deliver on your strategic objectives? Do you know what is the best way of implementing those changes? Will you need to change the structure of your business, such as incorporation, setting up new opperational divisions or trading companies. How will you finance your business, such as debt structures or bringing in equity finance. Here we will set out what will be required and what goals and deadlines will trigger the next step in your strategic plan.
Getting started with strategic planning
As with any business activity, the strategic planning process itself needs to be carefully managed, this is were we help. We work with you to outline responsibilities and resources and ensure that they are assigned to the right people.
Who to involve
Find people who show the kind of analytical skills that successful strategic planning depends upon, people with creative skills and those with a solid grasp of operational detail.
Above all, don’t do it yourself. Take on board the opinions of management, other staff and most importantly external stakeholders in your business.
How to structure the process
There is no right or wrong way to plan the process of strategic planning, but be clear in advance about how you intend to proceed. Everyone involved should know what is expected of them and crucially by when.
We advise holding weekly meetings with a strategy team before delegating the drafting of a strategy document to one of its members. Or to involve a broader range of stakeholders, such as employees and even key customers you might decide to hold strategy brainstorming sessions.
Build your plan on solid strategic analysis
Strategic planning is about positioning your business as effectively as possible in the marketplace. So you need to make sure that you conduct a thorough analysis of both your business and your market. This is were we help you, but to get an idea of what you can try yourself, then consider the following strategic models that you can use to help you structure your analysis.
- A SWOT analysis identifies the internal and external factors that are favourable and unfavourable to achieving a business goal
- PESTLE breaks the business environment down into external components that impact your business
- Porters Five Forces model aims to help businesses assess how competitive a market is.
If you can interrogate the results of the above models and find insight from them, then you are well ahead of your competitors.
What a written strategic plan should include
We don’t have a blueprint for how to structure a strategic plan as every company is different, but we do have a template that we consider to follow good practice by including the following elements:
- A Vision statement – a concise summary of where you see your business by the end of your planning horizon.
- Top-level objectives – these are the major goals that need to be achieved in order for your vision for the business to be realised. As an example, these might include attracting a new type of customer, developing new products and services, or securing new sources of finance.
- An analysis of internal drivers – corresponding to the strengths and weaknesses of a SWOT analysis.
- An analysis of external drivers – this should cover factors such as market structure, demand levels and cost pressures. PESTLE and Porters 5 forces give insight here.
- Implementation – this involves setting out the key actions (with desired outcomes and deadlines) that will need to be completed to attain your top level objectives.
- Resourcing – a summary of the implications your proposed strategy will have on your business’ resources. This will reflect financing requirements, as well as factors such as staffing levels, premises and equipment.
Strategic planning and ownership
Growing a business can pose some considerable personal challenges to the owner or manager, whose role can change dramatically as the business grows.
Effective strategic planning involves challenging the way that business has been done up to this point. It may be that decision-making in some areas will be handed to others, or that processes which have worked well in the past will no longer fit with future plans.
It can be tempting for owners or managers to overlook alternatives that are uncomfortable for them personally, but to disregard your options on these grounds can seriously compromise the growth of your business.
Implementing a strategic plan
The strategic plan needs to be implemented, which is a process that requires careful planning. The key to implementing is to assign goals and responsibilities with budgets and deadlines to responsible owners. Monitoring the progress of implementation and reviewing it against the strategic plan will be an ongoing process. Monitoring implementation is the key. Using key performance indicators (KPIs) and setting targets and deadlines is a good way of controlling the process of introducing strategic change.
This simply involves some of your time and a white board. Every journey starts with a single footstep, so if you want your business to grow, then think about what your strategy will be. If you need help to do this, then we have a great service available for you. But why don’t you start by downloading our FREE Strategy Plan Template, just Just click this link and you’ll receive a free Strategy Plan template. Better still, five respondents will receive a free Business Strategy Review, worth £797+VAT each!