Posted: Thu 22nd Aug 2019
What is planning? What is strategy? They are two terms that are widely used in small business support but what do they really mean to the founder of a new business? Business consultant Stuart Hartley shares advice.
At its core, strategy is about generating and selecting options to close gaps between objectives and current realities. Put simply: where are you, where do you want to go and how are you going to get there?
It is about creating and allocating resources to the right place, in the right way and at the right time to achieve your mission, vision, objectives and goals, all while maintaining your values.
The following six-step process will allow you to create a complete and robust strategic plan.
Set your destination
Your task as a founder and a leader is to lead the team in creating and selecting the most effective set of strategic options that will get you from where you are now to where you want to go.
A big part of strategy is identifying and playing to the business's strengths relative to its competitors and matching these to the changing environment and the subsequent opportunities and threats this may create.
No journey can start without knowing where you want to go. You should derive this directly from the company's mission and values, before you look at the current state of your business. Starting with the end in mind encourages bigger ideas.
Assess the facts of the current reality and develop future scenarios
The next step is to understand where are you now? This involves reviewing the five Cs:
You also need to understand the current opportunities and threats the business faces – i.e. by creating a SWOT (strengths, weaknesses, opportunities, and threats) analysis.
The next part of this is to develop scenarios – these originate from the PESTLE framework (political, economic, social, technology, legal, environmental). We use these categories to simply help us to identify opportunities and threats for the business.
It may be changing consumer sentiment or changes in technology that could replace the need for your products or services. If you do this well, you can predict what may happen in each different scenario and therefore which strategic option could be preferable.
Identify options to bridge gaps between reality and aspiration
Here, you determine which strategic options might create additional value for the business. Be creative, so you can come up with a range of options that can potentially address the issues and move the organisation forward.
There are lots of different exercises you can do here to help with this. Try and learn not only about what your competitors do but also learn about other successful businesses and how they have become successful.
Can you use any of these successes either directly or by adapting them in your business? This is often referred to as business model innovation.
This is a good time to get input from the people who have a stake in your business. They may also have good ideas. Keep in mind you're not looking for decisions, just input and options.
Evaluate the options under different scenarios
In this step, determine which options create the most value for the organisation over time, under different scenarios and different assumptions.
Evaluate scenarios and options leading to a range of forecasts based on clear assumption. Again, at this point, involve the people who hold a stake in your success to understand and help improve the assumptions you've made.
Develop detailed plans
With your strategic choices in place, develop a detailed plan that addresses the strategic, operational and organisational actions needed for you to follow through on the option you've chosen.
what resources you'll need and how you'll allocate them
roles and responsibilities
measures and goals
Act, measure, adjust, repeat
Once you've started implementing your plan, you should continually monitor its progress against your stated goals. This way, you can check that what you thought would happen is happening in a timely manner.
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