Strategically plan to more effectively hit all your business's objectives.
While many project leaders understand the importance of strategic planning, they may be unfamiliar with the tangible steps they can take to improve their planning processes. The need for strategic planning has never been more urgent, particularly with the quickly evolving nature of business technology and the emergence of disruptors that quickly change the competitive landscape.
Strategic planning helps insulate organizations from the effects of unexpected change by providing a way forward that takes into account a diverse range of business coefficients. This article is your strategic planning playbook, guiding you through what strategic planning is, six steps you can take to master it, and some best practices to keep top of mind.
What is strategic planning?
Strategic planning refers to the process of outlining your organization’s objectives and creating a roadmap designed to help you achieve them.
For small-to-midsize business (SMB) owners, strategic planning is especially important, because it enables you to rein in costs without sacrificing organizational mobility.
In this way, strategic planning provides you with guidance you can use to navigate twists and turns that might otherwise have disrupted your journey to success. It gives you a combination of SMART goals, an analysis of your business environment, your company’s strengths and weaknesses, a view of your competition, and the resources you have and will need to reach your goals.
The business impact of effective strategic planning can be monumental, especially when you allow its various elements to intertwine.
How to master your strategic planning process
Each of the following steps, when taken in sequence, makes it easier for SMB leaders to form an actionable plan that fits budget parameters and positions them for success—even in highly competitive markets. [1]
Step 1: Roadmap the plan
Roadmapping your plan starts with gleaning input from various stakeholders, including senior leadership. By gathering their input, you ensure that the strategic plan fits the goals of a wider range of people, many of whom may play a significant role along the way.
In addition, you should leverage project management tools as you form your roadmap. These tools can ensure you stick to appropriate timelines. Project management tools can also help you avoid scope creep, which means that the scope of objectives or action steps expands to the point where it consumes too many resources.
However, with a roadmap built using a diverse selection of voices, you can keep both your timeline and scope reasonable.
Step 2: Conduct external and internal scans
Conducting an external scan involves identifying trends, such as newcomers in the market and tech that could provide you or your competition with an advantage. An external scan would also include examining regulations that may impact how you work toward your objectives. For instance, there may be data privacy rules that pertain to your industry that you will need to consider as you devise action steps.
An internal scan focuses on examining your company’s strengths and weaknesses when it comes to how you accomplish business objectives. For example, suppose your company wants to ramp up its marketing—particularly its online presence. But you don’t have a strong social media presence. In that case, social media penetration may be a weakness. You could then either work around it or try to boost and optimize your social media participation.
Step 3: Determine strategic goals
Determining your strategic goals should result from examining three things:
Your vision or what you want to be
External trends or the things that are changing that could impact your vision
Core capabilities or the things you’re great at
In the process of determining your strategic goals, you should hone in on the areas where you want to invest the most energy and resources. This is also where you test the limits of your organization’s ambition, having productive conversations with stakeholders about which goals are too lofty and which are reasonable.
Step 4: Establish key initiatives and priorities
Your key initiatives are the high-level action items you’ll use to accomplish your goals.
For example, let’s say your consulting firm establishes a goal to expand its range of services to include advising commercial real estate professionals. One key initiative may be to attend and present at professional conferences aimed at people in the commercial real estate sector. While you don’t have to outline each and every conference set to take place over the next year, you can establish this as a key initiative for your firm.
The process of setting priorities is just as important because it helps determine how you’ll allocate the resources needed to support each initiative. The most important initiatives should receive the highest priority—and the resource support to match.
Step 5: Allocate resources
Once you have established your priorities, the process of allocating resources will be more straightforward. Resource allocation may focus on how you invest any of the following to make your strategic goals a reality:
Finances, including budget allocations from different departments, such as marketing, product development, sales support, human resources, and others.
Technology, which may include software systems that make it easier to automate workflows involved in reaching your goals. Technology can also include the process of digitizing a core business function, such as inventory management, customer relations, or social media marketing campaigns.
Human capital, which may be a combination of existing and new employees. This is also where you discuss resources to support training employees and filling key knowledge gaps.
Step 6: Communicate the plan
Your communication strategy should involve as much listening as it does talking. At this point, you still want to keep the details of your strategic plan somewhat fluid, especially because, while listening, you may hear something that inspires a change in direction. Those you present and listen to should include employees, investors, management at all levels, and, in many cases, partners and suppliers.
For example, if a supplier tells you they don’t have the production capacity to pump out enough product to support an element of your plan, you may have to scale back. It’s better to get these curveballs during the communication phase than to strike out later on.
Best practices and common mistakes
Here are some best practices that successful businesses use to develop effective strategic plans:
Identify stakeholders who need to be engaged. It’s better to have more stakeholders at the table than you need than not enough. This is especially true of stakeholders that may play a part in turning your plan into reality, such as sales managers and staff, those running assembly lines or fulfillment centers, and business partners.
Establish clear roles and responsibilities. Each element of your plan needs to have an owner—someone who takes responsibility for making it happen and who’s held accountable if it falls short. In addition to naming those involved, you should clearly outline what they would need to do on a daily basis to fulfill their roles.
Apply learnings from previous strategic plans. Regardless of the success—or lack thereof—of previous strategic plans, they’re treasure troves of valuable info. For example, examining a prior effort may produce measurement criteria and performance reviews you can learn from or recycle for your new initiative.
At the same time, many companies have had to learn the hard way how not to form a strategic plan. Here are some of the most common potholes so you can swerve around them:
Excessive complexity. A complex plan often forces you to make multiple changes to the plan itself or its timelines. This often results from trying to implement too many good ideas in a single strategic plan.
Lack of clearly outlined information. You need to clearly lay out information regarding your plan’s details and what’s involved in each action step—especially when it comes to stakeholders’ responsibilities. Otherwise, there can be confusion at all levels, from those in the C-suite to the boots on the ground.
Make a strategic plan that helps everyone
With the steps described above, you can systematically craft an effective strategic plan. By using the above best practices and avoiding common mistakes, you prevent miscommunications both early in the process and throughout its lifecycle.
With a combination of the right strategic planning software and more info on what makes a strategic plan successful, you can take the next step: building a strong framework for a plan that wins.