Any successful small business owner knows change is pivotal to continued growth – especially in today’s volatile market. Given the impacts of the past year and the emerging technologies rapidly reshaping the way we do business, to stay still today is essentially to go backwards.
Although there’s no doubt the past 18 months have been tough on small businesses, optimism is growing. The latest Sensis Business Index revealed business confidence about the future of the national economy doubled over the final four months of 2020.
What’s more, CPA Australia’s Small Business Survey for 2020-21 found a strong link between innovation, strategy and business growth amongst small businesses in Asia-Pacific. In other words, regularly reviewing your business strategy and committing to continual improvement is key to getting ahead.
With another EOFY over and a new one just begun, now is a great time to evaluate your approach and set your business up for success in the new financial year. In this article, we’re walking through the key steps to creating a strategic plan.
What is a strategic plan and why do you need one?
A strategic plan is a document outlining the intended direction of a business. It’s designed to assess where you are today, where you plan to go, and how you’ll get there.
Most small business owners have some ideas about where they want to be in the future, but they’re often abstract concepts that might not be tied to realistic goals and actions. A well thought-out strategic plan helps turn intent into action and provides a framework for responding to opportunities and challenges.
A strategic plan also requires thinking about the bigger picture, which is especially beneficial for small business owners who are notoriously time-poor and often caught up in the day-to-day.
You need one because it will help you, and all of your staff, to keep one eye on the goal, even as you deal with everyday challenges and regular work demands. It will ensure you stay focused on your future even as you manage today.
It can also give you a better understanding of your own strengths and weaknesses in the market, so you can continue to hone and make the most of your strengths, while improving your weaknesses.
Key steps for creating a strategic plan.
There are countless ways to go about creating a strategic plan, and endless formats and structures for presenting them. While that does make it difficult to ascertain the best way forward, it can help to think of the steps you must take as the basic ingredients that any business would need.
- Considering your current plans and paperwork in place
- Setting up your future goals
- Analysing your existing status as a business
- Creating a plan for bridging the gap
- Finishing with an executive summary
These five key steps for creating a strategic plan remain the same regardless of your industry, niche, audience, current status or future goals. So long as you cover each step to some extent, you will be well prepared to create a useful – and usable – strategic plan.
You might carry out these steps by yourself, or with the help of a trusted business partner or advisor who knows your company well.
Be sure to set aside time to complete your plan properly. By rushing it, you are only doing yourself and your future business a disservice.
Ultimately and perhaps surprisingly, your strategic plan must be simple. It must set clear goals that make it easy for you and your team to turn to for a roadmap on where you’re going and how to get there. One of the biggest failures of strategic plans is that they are too wordy, convoluted and difficult, which means they are often forgotten about as soon as they’re finished.
Over the years, you may find you prefer to add steps or additional areas of the plan that suit your needs and goals, but you can begin with these five to get started.
1. Review your existing business plan.
Beginning with your existing business plan is a good place to start when creating a strategic plan.
Your business plan should generally include:
- An executive summary including you mission and vision statements
- Your basic product or service
- A company description
- The structure of your company, and key leaders
- A general overview of how you plan to make sales
Not only will this review get you into the mindset of thinking of your business on a holistic level, it will provide you with a framework for moving ahead.
Your executive summary will remind you of your business goals and help you to determine if those goals have been met, are on track to be met, are not on track to be met, or perhaps are no longer goals at all.
You should be able to carry over your previous work on your structure, products and services, and company description into your strategic plan, which may help to save you time. Of course, it’s also important to review and update this information as needed, as these areas can change quickly.
2. Create a section on your future goals.
By drawing on your business plan and your own goals for the company, create a section that clearly outlines your future goals.
Think about what you absolutely have to achieve in order to break even, or pay off business debt. You can then build from there with what you want to achieve and what is most important to you.
Be sure to also ask your key stakeholders, managers, and senior employees for their input as to where they see the company going in the future.
Typically, you will seek to fill this section with:
- Strategic objectives
- The vision statement (updated if need be)
- Core company values
- Mission statement
- Long-term goals (these can be more general)
- What you hope to offer customers in the future (your future value proposition)
Each of these sections will typically be a page or two, and will be fleshed out with specific statements relating to your products and services, target audience and market.
3. Create a section on your current status.
With your future goals in mind, put together a section on your current status. Ask yourself, ‘where is my business right now?’ and be brutally honest in your answer.
Clouding the truth or brushing over weak points in this section will only make it more difficult to make a plan for making improvements, so it’s vital to paint an accurate picture of your current business.
Again, this is a good time to ask for advice and suggestions from leaders, managers and other interested parties in the business who can help to shine a light on your existing state.
This section will include information covering:
- Your current organisational structure
- An overview, including your products and services, sales performance, milestones so far, main KPIs and any other relevant information
- A SWOT analysis (strengths, weaknesses, opportunities, and threats)
- An analysis of your competition
- The challenges you face as a company, and if applicable, by department
- A PESTEL analysis for analysing current major business factors (political, economic, social, technological, environmental and legal)
- Risks facing the business
Naturally, it will take time to pull all of this information together, refine it, and collate it in a clear and concise format that’s easy to read and understand. Don’t be tempted to rush this section, as a thorough analysis of your current state is key for the next step.
4. Create your plan for bridging the gap between your reality now and your future goals.
Creating your plan to get from where you are now to where you would like to be is your strategic plan for moving ahead. Naturally, this is often the most difficult part.
The challenge here is usually a combination of determining the most important goals and the best route to achieving them. When there are many goals to work towards, and countless strategies to achieve them, narrowing down both aspects is key.
Each plan will include the tasks that must be completed, who will complete them, how much time it will take and how much financial investment you expect to use for each step.
Here are the main sections you’ll include in this section:
- A list of the main goals you hope to reach, including KPIs
- A plan for reaching each goal
- Clear guidelines for who will oversee each goal, and which team/s will work to achieve it
- A single-page summary of the goals, KPIs, teams and timeline
- Your financial expectations for reaching your goals
When working on your strategic plan, involve key stakeholders to help you determine the best paths to take and the strategies to get there. A professional strategic planner may also be a good option for businesses seeking advice from an expert.
5. Finish with an executive summary.
An executive summary will form the first page or two of your strategic plan, although you will write it last.
The goal of this section is to accurately and concisely summarise the entire strategic plan, including your current status, future goals and the plan for how to meet those goals. Even if your reader does not read the entire strategic plan, this summary should give them a solid idea of your business and its plans for the future.
Typically, an executive summary will include:
- A short overview of your business’ products/services
- A financial overview
- Your key goals
- Major challenges facing the business
- Your main priorities
- Your plan for meeting your goals
- Who is responsible for each goal
This entire section will be no more than two pages, so keep it concise and clear. Use bullet points to simplify lists and include page numbers to refer to further explanations within the full report.
The summary and the strategic plan as a whole, when used correctly, can help you achieve goals you wouldn’t have thought possible.
Be sure to set up regular reviews to keep you focused on these goals and ascertain if you are on track to meet them or if you need to review your existing strategies.
Keep in mind that a great strategic plan is flexible, as you will never be able to predict exactly what’s to come or how the market will react, so allowing some movement and forgiving yourself when goals aren’t met is important as you continue to improve and evolve.
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Explore the full range of Yellow Pages products online or get in touch to find out more about how you can get it done with Yellow Pages.