How to Develop a Strategic Plan

Whether you’re starting a new business, launching a new division or a new product line, or simply preparing for the future, you need to develop a strategic plan — your business’s road map to the future. The plan reminds you, your employees, and third parties what you do, how you do it, the customers you do it for, and maybe even how you’ll do it in a superior way.

Your strategic plan summarizes where your business is, where it wants to go, and how it’s going to get there.

Your budget, of course, is an important part of strategic planning. The budgeting process forces you to think, make decisions, and come up with reasonable forecasts. You can’t sidestep potential negatives, either. That would be like a farmer overlooking the possibility of a drought.

If you’re trying to attract financing to fuel your business venture, you’d better have a strategic plan (business plan) in place that lays out exactly how the business is going to generate sufficient revenue to cover its bills and either make payments on its loans or produce a return on any investments in the business. Nobody will lend money or invest in a business without seeing how that business plans to make money.

Strategic planning methods exist in abundance and seem to be a thriving cottage industry. They contain more letters than ten cans of alphabet soup, and include SWOT, PEST, STEER, EPISTEL, ATM, and RCA. Be cautious, and use common sense before embracing a planning methodology.

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