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What is strategic planning

07/16/2024
by

Mark

Business owners often have a dream for how they would like their company to grow over the coming years.

While this may be an incentive to work hard, a strategic plan can be a vital document, charting the way to success, and creating one doesn’t have to be a complicated process.

What is a strategic plan?

Simply put, a strategic plan looks at the past, present and future of a business. It includes both inside and outside factors, sets targets and provides a framework for reaching them. It is intended to help a company prepare for the future, and can be vital for one that is undergoing an expansion.

The basics of strategic planning

A good strategic plan answers three basic questions. These include: what are a business’s current values, mission, vision and capabilities; what are its goals and what is the best way to achieve them; and, finally, who is responsible for doing what, and at what time will they do it.

Begin with the current state section

This portion of the planning process examines a company’s current state. This often includes an overview of the business as well as its markets, its strengths, financial information, current and projected trends and also the key performance indicators being used.

Exploring internal and external environments can also be important. This may incorporate challenges by specific departments, a PESTEL (political, economic, social, technological, environmental, and legal) report and analysis such as 7-S and SWOT.

A vision of the future and how to get there

The next step is to prepare the future state section. As its name suggests, this looks to type years ahead. Strategic objectives should be clearly stated, and this section often incorporates vision and mission statements, goals, a business model canvas, and other details.

Implementing a strategic planning method

Now that the groundwork has been laid, it’s time to move on to the plan itself.

This portion of the document takes on board all of the factors mentioned in the above section and bridges the gap between a business’s current state and where it wants to be.

This step may include brainstorming sessions, workshops, and other collaborative efforts. The final results are then boiled down to a short list of ideas that are sustainable, profitable, and actionable. A consultant is often used during this process, as they will bring training and experience to the table.

What does strategic planning include?

The strategic plan usually includes corporate directions as well as priorities, financial projects, and a framework for meeting the goals that are set. An action plan that outlines specific directions for who will do what is also important.

Summing it up

The executive summary wraps up a plan, and while it is the last piece of the puzzle to be prepared, it is often placed at the beginning of the final document. It incorporates a company’s mission and vision statements, as well as very brief descriptions of the company, its products and services, its strategic objectives, the challenges it faces, a financial overview, its strategic priorities, and the action plan that has been developed as a result.

Follow the KISS principle

Following the KISS (Keep it Simple, Stupid) principle can really make a difference. It will make a plan clear and concise, helping it to age well as the company moves into the future.

Consider a shorter timeframe

In the past, it was common for a strategic plan to cover three to five years. Many now follow a shorter schedule, and this is due to rapidly changing technology and emerging markets.

Ask for input

Small and medium sized businesses often find it helpful to seek input from the employee team. This makes sure that all factors are taken into account – plus, employees tend to be more invested if they feel they have had a say.

Putting the plan in place

No matter how well crafted a plan may be, it’s useless if it isn’t implemented. They are living documents, and should be reviewed regularly to see if they are still valid, or could benefit from a review and upgrade. It’s also vital that it be communicated well to staff, and they have time to take its contents on board. This can be accomplished through regular team meetings that hold them accountable and celebrate their successes.

Contact Jim Crisafulli for strategic planning support

With more than 40 years of experience as a small business owner and consultant, Jim Crisafulli is a subject matter expert when it comes to strategic planning. Contact him today to learn more.

Written By

Mark

Mark