If you don’t know where your business is going, any road will get you there. Senior business managers are often so preoccupied with immediate issues that they lose sight of their ultimate objectives. That’s why a business review or preparation of a strategic plan is a virtual necessity. This may not be a recipe for success, but without it a business is much more likely to fail.
A sound plan should:
- Serve as a framework for decisions or for securing support and approval.
- Explain the business to others in order to inform, motivate and involve.
- Assist benchmarking & performance monitoring.
- Stimulate change and become the building block for next plan.
A strategic plan should not be confused with a business plan. The former is likely to be a very short document whereas the latter is likely to be much more substantial and detailed. The former provides the foundation and frame work for the latter.
A strategic plan should be visionary, conceptual and directional in contrast to an operational plan which is likely to be shorter term, tactical, tightly focused, implementable and measurable. As an example, compare the process of planning a vacation (where, when, duration, budget, who goes, how travel) with the final preparations (tasks, deadlines, funding, transport, weather and so on). A strategic plan must be realistic and attainable to allow the planner to think strategically and act operationally.
A critical review of past performance by the owners and management of a business and the preparation of a plan beyond normal budgetary horizons require a certain attitude of mind and pre-disposition. Some essential points which should be observed during the review and planning process include the following:
- Relate to the medium term i.e. 2 to 4 years
- Be undertaken by owners and directors
- Focus on matters of strategic importance
- Be separated from day-to-day work
- Be realistic, detached and critical
- Distinguish between cause and effect
- Be reviewed periodically
- Be written down.
As the precursor to developing a strategic plan, it is desirable to clearly identify the current status, objectives and strategies of an existing business or the latest thinking in respect of a new venture.
Correctly defined, these can be used as the basis for a critical examination to probe existing or perceived Strengths, Weaknesses, Threats and Opportunities. This then leads to strategy development covering the following issues discussed in more detail below:
For assistance in developing your strategic plan, consider an outside facilitator. We guide you with checklists, survey tools, active facilitation in planning sessions and finalise a report for your organisation with recommendations for action.