Key Elements of a Strategic Plan
A company’s strategic plan is the game plan that management uses for positioning the company in its chosen market arena, competing successfully, satisfying customers, and achieving good business performance. Most business owners and executives have countless excuses for not having a formal strategic plan. I’ve heard everything from We’re too new to We’re not big enough to We’ve never had one; why start now?
If these excuses sound familiar, check this out: Studies indicate that roughly 90 percent of all businesses lack a strategic plan. Of those that have a plan, only 10 percent actually implements it. So if you’re part of the 90 percent, ask yourself these questions:
Can our company be more focused?
Can we deliver more value?
Can our employees be more efficient?
Can our company be more successful?
Strategic vision: Bringing things into focus
You get results from what you focus on. Everyone knows this fact, but most companies are busy tending to the urgent problems of the day and not focusing on key long-term issues. Unless your staff can focus on a common vision, the company can’t go anywhere. A strategic plan helps direct energy and guide staff toward a shared goal in an ever-changing world.
Orit Gadiesh, chairman of Bain & Company, says, In the current environment, companies can’t afford not to have a set of guiding principles — a vision that communicates true north to the entire organization.
Strategy: Explaining the value you deliver
A strategy provides the vehicle and answers the question, How do we provide value to our customers better than our competitors? A good strategy focuses on efficiency through the following:
Achieving performance targets
Outperforming your competition
Achieving sustainable competitive advantage
Growing your revenue and maintaining or shrinking your expenses
Responding to changing market conditions
Basically, strategies keep your whole company acting together while strengthening the company’s long-term competitive position in the marketplace.
Strategic plan goals and objectives: Empowering employees
Goals and objectives make up the road map that empowers your employees to be more effective (and you, too, for that matter). Don’t let these elements be just a paragraph on the break room wall or bullet points in a memo; let them shine as primary guidelines for leading the organization to higher levels of performance. Goals and objectives provide the framework for independent decisions and actions initiated by departments, managers, and employees into a coordinated, company-wide game plan.
Strategic plan execution and evaluation: Ensuring success
A strategic plan is a living, dynamic document. It drives your business and must be integrated into every fiber of your organization so every employee helps move the company in the same direction.
All the best missions and strategies in the world are a waste of time if they aren’t implemented. To be truly successful, the plan can’t gather dust on the bookshelf. You know what shelf I’m talking about. If you ran a white glove over the shelf, you’d find layer upon layer of dust. You really should clean more often.
Okay, so, no, strategic planning success isn’t about cleaning; it’s about keeping the plan active so it doesn’t gather that proverbial dust. Know what your end result looks like and where your milestones should be. Plan your near term actions and evaluate your progress each quarter. Are you where you thought you’d be if you’d been on target? Or, if you’re off target, how far are you off? The course correction to put you back on track becomes your next action plan.
When your company has a clear plan and acts accordingly to the plan, you’re going to go from where you are to where you want to go, ensuring your success.