Thursday, 19 September 2013 13:17

Strategic Planning Helps Focus On The Big Picture

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Business development work can at times be a bit complicated. With so many moving small business parts, owners must know which tools are right for which job. Over time it became easier to understand the differences between business planning and strategic planning and when it was appropriate to use each one. Strategic plans are more conceptual in nature and produce the overall goals and objectives to be achieved. Business plans on the other hand are very specific and are responsible for carrying out those goals and objectives. The following is a further examination of strategic planning and how it can benefit your company.

What Is Strategic Planning

A strategic plan describes how your company executes a chosen strategy. It spells out where an organization is going over the next year or more, and how it's going to get there. Typically, a strategic plan is organization-wide or focused on a major function, such as a division, or a department. A strategic plan focuses the energy, resources, and time of everyone in the organization in the same direction. If you are going to implement a strategic plan be sure to take into account the following:

  • Make sure that your strategic plan focuses on helping your organization build a competitive advantage.
  • Use your strategic plan to focus on the right opportunities.
  • Use your strategic plan to help prioritize the company’s financial needs.

Assessing the Current Situation

In developing a strategic plan a company must answer the questions where are we right now and what are we up against both internally and externally. In drafting your strategic plan remember that the plan is not complete without examining the following:

  • Are there any pressing problems and if so what is the scope of those problems?
  • Has the company recently missed goals, been unprofitable, or experienced little to no growth?
  • What are the contributors to the organization’s current successes or failures?
  • What assumptions are you operating under that could affect the outcome of your business?
  • Finally what potential risk could you be facing over the coming years?

Because I am hard wired as a strategic thinker, it drives me crazy when business strategy is poorly done as in the case of companies like Kodak or more recently Netflix. In 2009 the Lego Group was facing a 5 percent global toy decline. Its strategic plan focused on cutting cost, creating better partnerships and licensing deals (Star Wars, Indiana Jones, and Toy Story), creating a more exciting line of toys, courting more young women and promoting Legos as a fun, systematic and creative way to play. Lego’s strategic plan paid off, allowing them to identify problems and establish goals and objectives for turning things around. In doing so they were able to realize a 23% sales increase during a global toy decline. What’s your strategy?

Cavanaugh L. Gray

Cavanaugh L. Gray (cgray@ecafellc.com) is the Director of Business Development for The Entrepreneur Café, L.L.C (877) 511-4820.  For more information on what makes a great start-up or to read a chapter from his new book The Entrepreneurial Spirit Lives: 25 Tales to Help Entrepreneurs Start, Grow, and Succeed in Small Business log on to www.ecafellc.com.  For more information on how to start, grow and succeed in small business, ‘Like’ on Facebook, ‘Follow’ on Twitter @TheECafe or ‘Connect’ on LinkedIn.

Website: www.ecafellc.com