Strategic planning for business growth
Key elements of strategic planning
A strategic plan is a key document that sets out your business direction and outlines steps you will take to get there. Critical to this document is the strategic planning process itself.
Strategic planning process
The planning process allows you to ask and answer four fundamental questions about your business:
- Where are you now? This is your starting point. Learn as much as you can about your business. Find out how it operates internally, what drives its profitability, and how it compares with competitors. Be realistic, detached and critical.
- Where do you want to take your business? What is your target destination? Outline where you see your business in three, five or ten years, what you want to focus on, and what will your competitive advantage be.
- How will you get there? Map out the journey, the milestones and the changes you will need to make to meet your strategic objectives.
- How will you know if you're succeeding? Determine the checkpoints and decide how you will measure success.
Read more about the purpose of strategic planning.
Essentials of strategic planning
Effective planning involves considering the following elements:
Where are you now?
Think about things like:
- strategic review
- core competencies
- market position
- business strategy
Where do you want to be?
- strategic focus
- vision statement
How will you get there?
Decide on your:
- strategic priorities
- action items
- resource allocation
How will you measure success?
- balanced scorecard
- key performance indicators (KPI)
Keep in mind that not all strategic plans end up the same. Some cover only one year; others take a longer-term view, generally three to five (and occasionally up to ten) years into the future. In some businesses, planning may produce only top-level information without action plans. Others will want to provide extensive details.
Whichever approach you take, make sure that your vision for the business is:
- clear and easy to convey
- holistic and takes a whole-business view
- purpose-driven and based on the real mission
- realistically achievable considering your resources and current position
How you will carry out strategic planning most likely depends on the nature of your business, its complexity, size, culture and expertise. You can use many different approaches and strategic tools to guide you. Read about the steps in the strategic planning process in more detail, and see which types of strategic planning models you can use.
Finally, be aware of the implications of any changes. You will have to carefully manage any strategic change to ensure that you successfully reach your goals and objectives, and fulfil your mission. Read more about change management.