Are you a new business owner who has no time to prepare a strategic plan for your business? Do you even know how to prepare a strategic plan? For the new business owner, it’s better to have a simplistic strategic plan instead of not having a strategic plan at all. This article will show the new business owner how to develop a strategic plan in 8 easy-to-follow steps.
If you’re like most beginning business owners you have an idea of what you want to accomplish in your business but it’s not written down. A document that captures your thoughts, vision and objectives on how you want to make money will give you, your current employees, and future employees direction when making business decisions. This type of document is called a strategic plan.
Strategic Plan versus an Action Plan. A strategic plan is usually a short document that talks about your current business, your future business, and 4-7 key strategy statements. These statements are the 4-7 items that you feel are critical to your business success. You are communicating to your employees and reminding yourself that these items are the focus of your Company. An important point to make is that a strategic plan does not go into “how” you plan to accomplish these 4-7 key strategies. A separate document, called an Action Plan, contains the information on “how” you will accomplish what is in your strategic plan. This article explains only the development of a strategic plan.
Three Parts of a Strategic Plan. There are three parts to a strategic plan. Part one includes your business mission, vision and values. Part two looks at your business strengths, weaknesses, opportunities, and threats. This is commonly referred to as a SWOT analysis. The third, and last, part is the 4-7 key strategy statements that were mentioned earlier in this article.
Here is an easy, 8-step, method to develop a strategic plan for the new business owner.
Mission, Vision, and Value Statement. Step one is to write your Mission Statement. This is a statement of what you want your company remembered for. Answer these three questions: What product or service does your company provide? Who is your customer? Why do they come to you and not your competitor? Your answers can be separate sentences or can be combined to make a single statement.
Step two is to write your Vision Statement or a statement of what your company aspires to be in 5 years or beyond. It usually is a very short statement. Answer these questions: What do you want your company to do that seems impossible right now but will build on your company expertise, strengths, resources or customer bases? Is the vision challenging and vivid? If not, make it so.
Step three is defining your values in a Value Statement. The basis of your company culture is dependent upon the values you include in your strategic plan. Write down words that describe the most important values for your company. Some words to consider: Customer-oriented, helpful, high quality, teamwork, integrity, expertise, or creative.
SWOT Analysis. A SWOT Analysis may be difficult for the new business owner because you may not have enough history to determine your strengths and weaknesses, however, the SWOT Analysis still should be done.
Step four is to define your company strengths. What does your company do very well? This could be related to service, product, employee, management, operations, etc… List 1-5 items. These will be items that you want to capitalize, leverage and / or promote.
Step five is to define your company weaknesses. Where does your company need to do better? List 3-5 items. These are items that you want to improve upon.
Opportunity and threats to your company deal with the environment influences outside of your company and outside of your direct control. You list theses items to be proactive and to determine which items need to be prioritized and used to your advantage or to have plans developed if or when a particular situation arises.
Step six is to list 1-4 opportunities and step seven is to list 1-4 of your company’s external threats. For both steps six and seven, you will need to consider the best or worse case scenarios if, while operating your business, the following changes occur: your business environment changes (political, legal, environmental, social or technical), if the industry that your business is in changes (new competitors, alternative products), the market changes (grows, gets smaller, new markets), or something happens with your competitors (what’s their strategies, strengths, weaknesses?).
Key Strategies. Once you know where you are (Mission), where you want to go (Vision) and what values will guide your company, you need to determine the top 4-7 strategies. These strategics contribute to achieving your company vision.
Step eight is to refer to your Mission and Vision statements and to begin to write down answers to the following questions: 1) How will I achieve my vision looking at where I am at currently (products / services, people, resources, environment, etc…)? And 2) What do I need to be doing today to achieve this vision? Look at your weakness list. Are these things preventing you from growing a stronger, more profitable business? Do they need to be addressed as a strategic statement?
Using Your Strategic Plan. As you gain more information about your business and customers you should refer to and update your strategic plan often. Reviewing your strategic plan may be on a monthly or quarterly basis.
With this easy to follow, 8-step method, you now have a strategic plan that any new business owner can immediately refer to for guidance and decision making criteria.