As 2015 draws nearer, many businesses are starting to work on their strategic planning. I thought it was an opportune time to share the importance of having a strategic plan in your business, no matter what size your organization. Before we start talking about strategic plans, ask yourself a few questions to see if your business would benefit from one.
If you walked up to a handful of your employees and asked them “What is the vision of our company?”, would they all say something different or not know?
Is the business environment you are operating in changing over the next couple of years or sooner?
Do you ever hear “I don’t know why we do this, we have always done it this way”?
Do your customer’s wants and needs change over time?
If you responded yes to even a couple of these questions, your business would benefit from a strategic plan. Before we get into the benefits, let’s define what we are talking about.
What is a strategic plan?
A very straightforward definition of a strategic plan is: a formalized document describing the path of the organization. It describes where you want the organization to go. There are many schools of thought on how long and detailed a strategic plan should be. My recommendation is that it should be the length that you need to ensure you use it. If you create a strategic plan that fills a three-ring binder and then you set it on a shelf to collect dust – that is not an effective strategic plan. Some organizations could benefit from a straightforward strategic plan that is one page. The other consideration is what time period a strategic plan should cover. If you are just going to look at a one-year time horizon, you are probably selling the strategic plan short; unless you are in a very tumultuous industry. A solid strategic plan should look out over several years. Remember, this is planning on where your company is going. There are definitely other factors involved in the effectiveness of a strategic plan, which we will cover, but it is important to know the benefits of a strategic plan.
What are the benefits of a strategic plan?
One of the best benefits of a strategic plan is it ensures that everyone in the business is focused and working on the same goal. I’m sure you have had the scenario where you asked a small group of people to problem-solve an issue. By combining the efforts of the individuals in the group, you were able to achieve great things. What if you used that process for the whole organization? What if the entire organization focused on this one vision? Think of the possibilities – it’s staggering!
The other major benefit of a good strategic plan is it will guide your organization to use resources correctly. It will be harder for a group to go off on an unproductive tangent that is not benefiting the long-term success of the business.
The strategic plan is also a great tool for making difficult decisions. You can weigh the outcomes of a decision on how it will affect the strategic plan. This is a very powerful roadmap for everyone in your organization to use.
How do I create a strategic plan?
A great way to start the process of creating a strategic plan is with a SWOTT analysis: Strengths, Weaknesses, Opportunities, Threats, and Trends. I won’t go into the details of how a SWOTT analysis is completed; that is a great discussion for a later time. However, it is critical that you involve the right group of people to participate. This is a fantastic opportunity to gain insights from your employees, vendors, and especially customers. They all have powerful information for you to use in crafting your strategic plan. If you want buy-in on your completed plan, and you do, the best way to ensure that is to have these groups participate. If this is the first time you have gone through the strategic planning process, I would highly recommend pulling in an outside expert to help facilitate the process. This is a great way to bring in expertise to help your group think outside the box and get out of their comfort zone. We need to remember that the long-term success of our business will require change.
What a strategic plan is not
A strategic plan is not your business plan. Your business plan is a separate document and will have very specific steps on how to accomplish what is in the strategic plan, but it is a separate document. Each department in your organization may have a business plan that helps them achieve their part of the overall strategic plan.
A strategic plan is not static – it is a living document. As I mentioned earlier, if the plan is to create a strategic plan and put it on the shelf, save your time and energy by not doing it. This is a document that needs to be a part of the day-to-day operations in the business. It can change. As our business environment changes, the strategic plan should be reviewed and possibly changed. This is an ongoing exercise and benefit.
A strategic plan is not a top-down initiative, although there must be 100% commitment from the leadership team in the initiative. The best way to get a strategic plan to not work is to not have a diverse group of participants. Beyond making the plan more comprehensive, having a representative group helps with buy-in for the whole organization.
Now that you know a little more about the benefits and mechanics of a strategic plan, your next step is to begin the process. This is a great opportunity to enhance the success of your business, improve employee engagement, and come up with some innovative ideas for the future. While it may seem like an imposing initiative, the benefits of a solid strategic plan can be game-changing. If you would like more information on strategic plans or would like help starting the process, contact us today, we are excited to help you grow!
“Leadership is the capacity to translate vision into reality.” – Warren G. Bennis