Starting a new business can be a real leap of faith, but with the right tools and some helpful advice along the way, it may be much easier to find success. One step that may be very useful is a strategic business plan, and companies of all sizes may find them useful.
What is a strategic business plan?
A strategic business plan uses a variety of data points and other information to plan for the future. It can start with picturing where a company should be in five years or more, and finding ways to make that happen. It uses factors such as a company’s current environment, and both internal and external influences should be considered, and they may all play a role in how an establishment grows.
How is this different from basic business plan?
While it may be valuable for a company to have both strategic and business plans, they are not the same. A business plan takes into account factors such as how an establishment generates revenues and considers its foundation, markets, industry projections and other factors. Business plans consider the present, day to day operations, while a strategic business plan looks forward to the future over a much longer period of time.
How to get started
Getting started with developing a path towards future success may seem daunting at first, but it doesn’t have to be. A good tip when starting out is to determine and set reasonable targets. If they are too high, they may be impossible to reach, and if they are too low, they may be a waste of time. It’s best to shoot for a target that is reasonable and well informed.
The value of SWOT analysis
A key step in preparing a strategic business plan may be to engage in some SWOT (strengths, weaknesses, opportunities, and threats) analysis sessions. This will help to identify any internal weaknesses that exist in the business, while also highlighting strengths to build on. It also encompasses external threats and opportunities that may help a company to reach its strategic goals. In today’s crowded corporate landscape, this may be especially important, as it takes into account the competition a business faces in the marketplace.
Some questions to consider
Many strategic business plans address key questions that determine its future path. These cover a company’s current capabilities, vision, mission, and values, as well as its goals and a framework for achieving them.
Metrics matter
When working on a strategic campaign, it’s wise to assign a quantifiable metric to the process, and this will make it easier to determine if a plan is working or not. Set a time frame for revisiting the document to make sure it’s still working and doesn’t need a few tweaks or even a major overhaul to make sure it’s still applicable
When preparing a plan, it’s important to remember that it is a document intended to be used for an extended period of time. Since it will tell staff and management where a business is going and also how it will get there, it should be consulted frequently.
An important factor in making sure a strategic business plan is useful is how it is written. It should be simple, using clear language that is easy to understand. Think of it like a road map ahead. The simplest route is usually the best, and the plan should be actionable and basic enough that it can be utilized each day.
Getting the process off the ground
When preparing the strategic business plan document, it makes sense to start with an action plan that addresses the current state of a company. This will include an overview of the operation, an analysis of its current management and employee structure and also the internal and external influences that impact its operations. Its past achievements should be noted as well along with any internal or external barrier that may impact the implementation of the final document.
This is where the current staff and projected staffing needs may come in. It can discuss how various departments may need additional support, and the changing workplace landscape, including working from home, the increase in the number of freelancers and independent contractors and other important factors. As the applicable laws and regulations that surround this are in a state of flux, it may be smart to seek some outside input.
What tools are out there that may help
Along with SWOT analysis, there are several tools that may be useful when developing a strategic business plan. These include Porter’s Five Forces, a BGC Growth Share Matrix, &-S assessments and PESTEL analysis. These each look to the future in their own way, and the ones utilized will depend on each individual company’s needs.
Looking forward to the days to come
Once the past and current forces that impact a company have been discussed, it’s time to move on to the plan’s future state section. This contains its strategic objectives as well as its vision statement, which outlines its future aspirations.
Another section of the document should be a discussion of an enterprise’s core values and mission statement, as well as also the broad goals it hopes to achieve over an extended period of time. Changes to its business model and future value proposition may be discussed, and this will provide a historical account of how the plan has changed over time.
Many plans include an appendix that gives the reader a brief summary of barriers that may prevent its implementation and also the information in the current and future state sections.
Settling on a strategic plan
It’s now time to consider the final strategic plan. This section of the document will build on the past, present and future, bridge the gap between them. This often includes using input from management and staff, which can brainstorm ideas together, including both their perspectives. It can be smart to develop a set of goals which can be narrowed down to a smaller group that are achievable and sustainable over the long term.
Write an A level action plan
An action plan may prove to be invaluable. It takes a strategic plan and boils it down into a set of steps and lays out who will be responsible for each. It also provides a timeline and key performance indicators that will be used to determine if a new initiative is a success.
End with an executive summary
Many strategic business plans wrap up with an executive summary. This is often presented at the beginning of a report, and should include a brief account of a company’s mission statements and vision. These also incorporate brief descriptions of its various sections and their contents. This will give the reader an introduction to what’s to come.
The final result
When preparing the final document for distribution, it can really pay off to consider its overall layout. Many choose to put the Executive Summary first, followed by the future state plan, the strategic and action plan and, finally, a review of a business’s current state. This will emphasize that the goal is to meet the objectives set out in the future state and strategic plans by building on a company’s current strengths and addressing its weaknesses.
Clarity matters
As the completed plan will be a living, breathing document, its language should be clear and concise. Business plans are often presented to staff, management and other interested parties as a PowerPoint or other visual representation, and it may really pay off if the information it contains is easy to find. A suggested length is 40 to 70 pages, as this will make it long enough to provide important relevant information, but not so long that the reader gets bogged down or loses interest altogether.
What about the short term
While it’s true that many strategic business plans are intended for a time frame of five years or more, it may also be valuable to revisit them and prepare yearly ones with shorter term objectives in mind. These annual documents ensure that the larger plan is still working well, and they often follow the same format.
Pitfalls to avoid
While studies have shown that a well-constructed strategic business plan can really pay off, there are some pitfalls to watch out for.
When addressing an issue, be sure to include its root cause or causes. Treating the symptoms won’t work over the long term. It’s also important to maintain a company’s core values and to put the research in ahead of time to make sure the final document is an accurate reflection of both the business and external influences.
Consider your audience
While the overall strategic business plan will remain the same, how it is presented may differ. Employees may have a very different perspective than investors, investors or owners, so it makes sense to tailor a presentation to your target audience. It can be wise to have a supply printed ahead of time so they can be distributed upon request with short notice.
The way ahead
Preparing a strategic business plan can really pay off, and is considered by many to be an essential piece of running a company. While they may be very important, they are not always easy to prepare. Business coach Jim Crisafulli of Crisafulli Business Coaching has decades of experience in the corporate world, and sees his clients as individuals, helping them each find their own unique way to success. Contact him today to find out more about all he has to offer companies looking to take their next step towards success.
Written By
Mark