Have you ever written a strategic plan for your company?
By Rieva Lesonsky
If not, it’s time to stop driving without a map and start charting your own course.
Strategic plans have long been used in the world of big business. But today, with AI and robotics transforming the way we do business, and change happening faster than ever before, even the smallest business can benefit from some advance planning.
What is a strategic plan?
A strategic plan is a document that details your business’s long-term goals and how you’ll get there. (A business plan is one type of strategic plan.) Strategic plans are often developed in five-year increments. However, with so much data now available about your market, your industry and the world, some experts suggest writing a 10-year or even 20-year strategic plan.
By looking further into the future, you can come up with options for how your business should react to possible scenarios. Then, you can use “agile planning” to create short-term strategic plans (such as six or 12 months out) to drive you closer to your ultimate goals.
Steps to writing a strategic plan
No matter how far in the future your strategic plan looks, the basic process is the same.
- Take stock of how your business is doing. Get your business plan, business mission and vision statements together. Gather your sales data and financial statements. Complete a SWOT analysis to identify your business’s strengths and weaknesses and spot opportunities and threats that the industry, the economy and the competition pose.
- Dream big. Decide where you want your business to be in five, 10 or 20 years. Do you want to expand your product line, add dozens of locations or change your target market? Maybe you want to start selling nationally or even worldwide.
If you can’t envision your business’s future that far out, try imagining what you want your life to look like at that time. For example:
- Do you want to be working fewer hours?
- Do you want your business to be the size of Starbucks or McDonald’s?
- Do you want to be traveling the world on buying missions?
- Do you still want to be part of the day-to-day business, or would you rather focus on the “big picture”?
Put these personal goals in writing and then assess what business goals you have to achieve to make them happen.
- Develop a concrete plan for reaching your business goals. Working backwards from your desired outcome, identify what you need to do to achieve it and when. For example, if you want to sell your business in five years so you can launch another startup, you’ll need to grow your sales, hire more employees, systematize operations so the company can run without you, and generate value in the business to make it appealing for sale. The closer you get to today, the more detailed your plan should be. Make sure your strategic plan is executable and that it covers marketing and sales, operations, management, capital access and everything you need to reach your goals.
- Decide how you’ll assess results. Make your goals specific and measurable and decide how you’ll measure success. Select the key performance indicators (KPIs) you’ll use for each strategic goal. If your goal is to expand regionally in three years, define exactly how many locations that means, and what the “region” consists of.
Making a strategic plan work
Measure results on an ongoing basis, then review your progress every three to months. This approach allows you to make adjustments quickly so you stay on track toward your goals. For example, if your plan to add locations is not working out as you hoped, maybe you could get the same kind of growth by expanding your demographic market.
Stay abreast of market and industry trends and economic indicators and adjust your plan accordingly. Keep your eyes on the prize: As the old saying goes, “If you don’t know where you’re going, you’ll probably end up somewhere else.”
Businessman searches for new horizon stock photo from alphaspirit/Shutterstock