Although there's no one standard for strategic planning, there are some basic steps you can keep in mind during the process. Remember that strategic planning is defined as a systematic way to develop a course and direction for your company. It helps you determine exactly where your organization is going over the next year or more, and how it's going to get there.
Prepare and define the scope of your planning
Ask yourself these key questions:
- What is your real motivation for doing strategic planning?
- Do you want an overall plan or specific plans for various units of your business, depending on its size?
- Do you have management buy-in?
- Will they eventually use it?
- What improvements will you see in your company (sales increase, market penetration, sharpened competitive edge, etc.)?
- How much will it cost?
Assign somebody to be responsible for the strategic plan from development to successful implementation. Although a business owner or president may take the official lead, this role can be played by anyone in the organization who has the ability to step back from the situation and assess it with an objective point of view. This person can then gain an overview of your business reality.
Although an external consultant such as BDC Consulting can give you guidance, it's unwise to hand over all aspects of strategic planning to an outsider. After all, you know your business and your team best. External assistance may bring a fresh perspective or new ideas to the table, and it can be especially helpful at the analysis stage, or if you've never undergone the strategic planning process before. However, your focused involvement in the process is crucial.
Analyze your strengths, weaknesses, opportunities and threats (SWOT)
This is where you lay the groundwork for the development of appropriate strategies. If you don't analyze your strengths, weaknesses, opportunities and threats, your strategic plan won't take you where you want to go.
Internal assessment
Assess your strengths and weaknesses by answering these questions:
- What do we do best?
- Where do we have gaps?
- What are our company's resources—assets, intellectual property and people?
- What are our company's capabilities and limits?
Here's a quick checklist of internal factors you may want to assess:
- Products & services
- Price, promotion and distribution methods
- Service approach
- Research & development
- Administration and Management
- Human resources
External assessment
Assess your opportunities and threats by answering these questions:
- What is happening externally in the market that will affect my company?
- What are the strengths and weaknesses of each of our competitors?
- What are the driving forces behind sales trends?
- What are the markets that now present opportunities?
- Which markets are dissolving?
Here's a quick checklist of external factors you may wish to assess:
- Government taxation policies, trade barriers and related legislation
- General health of the economy
- Socio-demographic trends such as prevailing values and culture
- Demographic trends such as target market shifts, aging population and diversity in the marketplace
- Advancement of technology and automation
Once these factors have been identified and clearly recorded, you can move on to defining and formulating key strategies to address these issues.
Formulate your strategies
To simplify this exercise, you can think of 2 types of strategies.
Overall strategies are general strategies that won't change much in the long term. For example:
- To increase our market share in the industry
- To significantly improve the competitive position of our business
Tactics help you reach your overall strategies and may change rapidly in reaction to competitive situations. Tactics should involve a clear form of action:
- To increase our competitive edge by improving our processes and reducing costs
- To significantly improve the market share of our business by increasing our sales force
Implement your strategies
Now that you've determined your strategies, you need to take steps to implement them in order to reach your goals.
Put your action plan on paper in a clear and convincing tone. Basically, it's like preparing a to-do list for each goal and assigning responsibility to get things done. Assign the writing task to a single person and be sure the plan is reviewed by other people for clarifications or improvements.
Here are some of the essentials to include in your strategic plan:
- main challenges of your business
- objectives and strategies
- means to achieve objectives and implement strategies: tactics
- resources available
- criteria used to measure progress
Communicate the plan
To secure buy-in and a smooth implementation, be sure you communicate the plan effectively.
Measure your progress
Your goals should be measurable, so be sure to put these measurements and targets on paper as well. Essentially, you want to actively track your progress. It may help to have an external consultant involved at this stage in order to have an objective viewpoint.
