Strategic Planning for your Business
Filed under:Family Business
Is your business positioned to take advantage of future opportunities?
Businesses often start with a great idea or a new emerging product. Unfortunately, they can also die from the same opportunity if they don’t know how to adapt. A business stagnates when it isn’t regularly looking for new opportunities, or reacting appropriately to the changing environment. A business with a vision sees where it is going and puts plans in place to get there. A strategic plan should help your business position itself to take advantage of future opportunities and make your business’ vision a reality.
Planning or Strategic Planning?
There are subtle differences between planning and strategic planning, and a business should be critical of its activities and challenge itself on whether or not it is actually putting strategies in motion to achieve its goals. Measuring, tracking, and accounting for tend to all be activities associated with planning. Betting, leveraging, positioning, and competing tend to be activities associated with strategic planning.
A strategy is synonymous with games and sports. A poker player has to put his chips in and bet in order to play. The player then needs to constantly decide which hands are worth playing and which ones to fold. They have an opportunity to stay at the table for a long time if they make the minimum bets and simply fold. Likewise, they could go all-in on the first hand, only to be going home right away.
Small business owners tend to confuse their planning activities with their strategic activities. Looking inward to your business, identify things you have done recently to take advantage of a future opportunity (your bets).
Examples of Strategic Activities:
- Paid down debt or saved cash to allow for capital investment in future opportunities
- Opened a new location in a new market
- Sent key employees to technical training to enter a new service area
- Invested in R & D
- Created a new product line
- Acquired a competitor
If you are unable to identify similar activities, your business could be in need of some strategic planning. A great way to start this strategic plan is to:
- Formalize your business’ vision (where you want your business to be in the future). There are many tools and guides available for developing your business’ vision.
- Draft some action items that your business must do to make the vision a reality (your bets).
- Implement the action items.
- Revisit your vision quarterly and assess your progress towards achieving it. Adjust your approach, if necessary. Add action items to your strategic plan.
It is important to treat your business’ strategic plan as a living plan that can be changed when necessary. You have to know when to hold ’em, and when to fold ’em.