Most business owners know they should prepare a strategic
plan but seldom follow through because they are too busy
working "in" their business or because they don't know how
to prepare a strategic plan. For the new business owner,
it's better to have a simplistic strategic plan rather than
no strategic plan at all. This article will teach the new
business owner how to prepare a strategic plan in an easy
and simple manner using an 8-step method.
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 to 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.
It is important that you are committed to the values that
you write down, as they are the basis for your company
culture. 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. What areas
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 strategies will help you achieve 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.
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