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Business Planning: Developing a Strategic Plan

In preparing this article on the development of a strategic plan, the assumption made is that anyone going so far as to even read an article on strategic planning understands, or at least is beginning to understand, the importance of a written business plan. And like the first (Summary Statement)* and second (Company Analysis)* sections of a written business plan, a key factor in the development of section three (Strategic Plan) is your honest and accurate reflection; and, with another element added, the use of your imagination!

*Note: To review the "Purpose of a Summary Statement" go to the March 2002 article under How to Develop a Written Business Plan by clicking here. To review the "Development of the Company Analysis" go to the May 2002 article under How to Develop a Written Business Plan clicking here.

The strategic plan, written within your business plan, is your opportunity to step outside of what you know and create the plan for moving your company and team to not only what's next, but also what's beyond that. As a leader it is your job to be a visionary for your company, and the strategic plan is where you put that vision on paper, communicating to your employees what your vision is and the implementation plan for getting there.

Strategic planning also provides:

• A forum for exploring what opportunities may exist to increase your competitive edge and reduce whatever threats are facing your company.
  
• A look into those weaknesses within your company or team that could hinder the implementation of the plan and provides an opportunity for creating an action plan for overcoming those weaknesses.
  
• The ability to react quickly to changes in the market. It is somewhat like being on a well-planned journey and getting stuck in traffic. It is much easier to adjust to the unexpected detours when you know where you ultimately want to go.
  

Following is an outline that will help you develop an outrageous Strategic Plan:

1. Long Term Goals: Your business plan should serve as a roadmap towards a specific destination; the strategic plan establishes these important landmarks by communicating the long-term goals for your company. In this section you should outline your one-year, two-year and, maybe, three-year goals. These goals should be very specific (i.e. To increase gross profits from $XXX to $XXX by June 1, 2003); and while you should be realistic when setting these goals, keep in mind what YOU really want for the company, and also for yourself. Remember, "you can't reach a goal if you haven't set one."
   
2. Assumptions of the Plan: Just as we laid out the assumptions that were being made as this article was prepared, you need to communicate what assumptions are made as you establish goals and the strategic plan as a whole, is developed. For instance, you may be assuming that key personnel within your company will remain at their post over the life of the plan. Or if your 3-year goal is incumbent upon reaching your 1-year goal, you must state that assumption. Remember, no one, including potential investors and your team members responsible for helping the company reach the established goals, can read your mind! If they could, there would not necessarily be a need for a written plan, now would there?
   
3. Strengths to Explore: What gives your business its competitive edge? Is there untapped potential lying dormant within a team member? Do you have within your sites a "niche market" that has yet to be cultivated and you are capable of tending? Do you have in development a new product or service that has potential to set you above your competitors? Whatever your strengths, this section is an opportunity to take an honest look at what resources you now have for reaching your established goals and developing a plan for cultivating those resources in order for them to better serve your company.
   
4. Weaknesses to Overcome: Do you want to know how to avoid getting caught in traffic when on a car trip? Or better yet, do you want to know how to avoid a complete breakdown? Do your homework, study the map, and review your equipment, all with a critical eye determined to avoid potential stops in your journey. So what is the biggest potential factor in your not reaching the goals you have set? The purpose of this section is to eliminate or reduce your company's potential weaknesses by taking the offensive position necessary to reduce whatever threats your business could possibly face. Important note: if you are going to include a weakness, include a strategy for overcoming it. Otherwise, your team and/or potential investors are left with a roadblock and possibly the assumption that this weakness cannot be overcome.
   
5. Opportunities to Explore: What product/service can your company offer that is not mainstream or offered by your competitors? What benefits can you offer your customer? How can you offer a better price without reducing the quality of the product or service? How can you expand your sales while controlling costs? In this section, the sky's the limit. So, get those creative juices flowing and use your imagination!
   
   Note: To really be able to develop this section, you must know who your competition is. To read the section on analyzing your competition in the May 2002 How To Develop A Written Business Plan article titled, "Business Planning: Development of the Company Analysis", click here.
   
6. Strategy Implementation: A Strategic Plan is useless if it does not include the intended journey's roadmap and a by-when for reaching each destination. The strategy implementation section should detail how you will put into action the strategy for reaching your goals, who is responsible for what tasks, a deadline for completion, and the intended specific, measurable results. This section communicates to your team your expectations of them, and it communicates to potential investors that you have a clear plan of action and what the intended results will be. Without this section, you are stuck in traffic without a clue as to how to get out of it.
   

A Strategic Plan embodies "What's Next" for your business. It is a catalyst for developing new ideas and strategies for growth, while at the same time providing direction for yourself and your team. Your Strategic Plan can truly be the driving force for your company and its employees if you make it a document that you run your business from. When prepared with a realistic and accurate view of your company, along with a touch of imagination, there is no limit on where your roadmap may ultimately lead! Remember:

To access the complete CNLB Business Planning Outline click here.