When I speak to business owners about planning I find their eyes often glaze over, or they break out in a cold sweat.
“Planning? Oh no!” they say. “Do we really need to talk about that? How will it make my business better?”
But planning doesn’t have to be an onerous task and it is very valuable.
I recently met with a new client to discuss the strategic planning program we are about to embark on with them.
The client was surprised to learn the process would only take about 10 hours of their time, in total, and the resulting document would not be a weighty tome destined for a dusty bookshelf, but instead about 10 pages of practical strategies, actions and targets that could be easily communicated to their team.
It got me thinking that many other people probably share the same misconceptions about strategic planning.
My aim for this blog is to explain:
- What is a Strategic Plan
- The 5-step approach to Strategic Planning
- What a business owner can expect from a Strategic Planning process.
What is a Strategic Plan?
The Strategic Plan shows the strategic direction of a business and will usually cover a period of one to five years.
I like a Strategic Plan to focus on a period of three years because, in today’s volatile world, things get a little hazy after three years (or even one, sometimes!).
The Strategic Plan gives context to the people within the business as to where the business is tracking overall, for example:
- what business lines we’re focusing on
- what markets we’re looking at
- what product range we’re looking at
- where we’re going and how we intend to get there over that period.
The 5-step approach to Strategic Planning
When working with clients to develop a Strategic Plan we generally follow five key steps:
- Confirm current position, issues, risks and opportunities
- Identify and evaluate ‘future state’ options and success factors, relative to the broader industry, market dynamics and trends, and internal capabilities
- Confirm point of difference, competitive advantages, drivers of success, core reason for being and priorities
- Devise realistic strategies, actions and targets to achieve the desired future state
- Produce a Strategic Plan that confirms:
- Mission
- Values
- Culture
- Strategies
- Targets
… and has a delivery track and risk plan to keep all key players ‘honest’ in sponsoring and participating in the forward process.
Hint: The targets need to be clear, simple, recognisable and outcome focused – less is usually more in these cases. You also need a good mix of hard, financial and business-based targets, and softer, people and behaviour-based targets. Finally, a practical monitoring process will assist in making the plan a reality.
What a business owner can expect from a Strategic Planning process
From our experience, effective Strategic Planning need not be a long and involved process that culminates in a large detailed document.
The successful plans we facilitate usually involve developing and agreeing on the core elements over a facilitated working session of key contributors and decision makers.
We generally break the strategic planning process into stages; different stages require different levels of input from the various team members.
- Stage 1 – Preparatory discussions with key people accountable for the important outcomes within the business to identify issues, risks and opportunities and review of financial and business information.
- Stage 2 – Facilitation of strategic planning working session (about 3–5 hours) involving all the main team members of the business. You need a mix here – from the shop floor to the leadership team – as your plan needs to be both aspirational and grounded in reality.
- Stage 3 – Drafting and producing the Strategic Plan, followed by review, approval and communication to the wider team.
Hint: Don’t underestimate the value and importance of the communication process within your team and business (and with key customers, suppliers and financiers), as you develop the plan and also after it is finalised. Remember, they all have a role to play in your business being successful, so it’s important you don’t take their involvement and interest for granted.
If you need support, advice or facilitation services to develop a Strategic Plan for your business, contact the team at JPAbusiness on 02 6360 0360 for a confidential initial discussion.
