There are many small business owners out there who do not realize how crucial strategic planning is to the success of their business. Beginner entrepreneurs often make the mistake of thinking that strategic planning is something only big corporations do. Usually, their reasoning is that big corporations can afford the staff and resources needed to produce sophisticated game plans while they’re struggling just to get the business off the ground. But when it comes to having a plan of action for your business, size doesn’t matter. Even the tiniest and simplest businesses need one.
Strategic plans for small businesses don’t have to be as complex and long as those of the bigger players. You don’t need to use advanced statistical programs for financial forecasts and you certainly don’t need to incorporate flashy graphic illustrations into your strategic plan in order for it to serve its purpose. You can come up with a solid, working draft in a matter of hours if you really focus on it.
A strategic plan is so important because it helps you plot out, step-by-step, what actions your business will pursue in order to achieve success. It also addresses potential obstacles that lay ahead and warrants that you find ways to overcome them. In a way, strategic plans are even more vital to small businesses than big corporations. That’s because small businesses have a much smaller margin of error and a lot less cash to fall back on if something goes wrong. Having said that, it is due time to examine the basic components of a good strategic plan.
Mission Statement
Any good strategic plan should have a mission statement. It should be short, concise and should explain the business’s reason for existing and what it aims to accomplish. One of the Coca-Cola Company’s mission statements, for example, is “To Refresh the World…in body, mind, and spirit”.
Organizational Goals
Your organizational goals are the ways in which you plan to fulfil your mission statement. In this part of your strategic plan, you shouldn’t be concerned with any conflicting goals at the beginning. Start by brainstorming all the goals you can imagine pursuing and writing them down. Then, you need to look at each one carefully and decide which ones you are going to choose. Because you have limited resources, you will not be able to pursue every single one of your organizational goals at the early stages of your business.
A good technique to help you in choosing the appropriate goals is a SWOT analysis (strengths, weaknesses, opportunities, threats analysis). You assess each of these factors for your own business as well as for your competitors and the industry as a whole. Although a SWOT analysis can be relatively time-consuming, it helps you to get clear about what you’re presently doing right, where you need to improve, and which market opportunities to embrace or protect yourself against. One of the Coca-Cola Company’s organizational goals, for example, is “bringing to the world a portfolio of beverage brands that anticipate and satisfy peoples’ desires and needs”.
Goal Achievement Strategies
These strategies go one level deeper and state how you plan to achieve each of your organizational goals. For example, the Coca-Cola Company’s strategy to accomplish the above-mentioned goal could be to build up an extensive bottling and distribution network to ensure that its beverages are available to everyone in the world. An important thing to remember is that your strategies may need to be adjusted from time to time, depending on how well they work alongside changing market dynamics. Make sure you incorporate regular evaluations of a strategy’s performance into your plan.
Action Plans
Action plans state how you will go about accomplishing your goal achievement strategies. The key to establishing effective action plans is to be as detailed as possible. You need to make sure every step of your action plan is outlined in such a way that you can check each one off as you would in a shopping checklist. This helps you to focus on the tasks at hand and to see whether you have accomplished the necessary actions in the right time frame.
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