Whether you are a start-up, growth stage, well-established, public, private, SME or a not-for-profit organisation, there is no denying that long-term success in today’s ever-changing economic landscape begins with a strong foundation. In other words, a solid strategic plan is key to making informed business decisions.
An effective strategic plan is a living document with a framework of defined values, vision, short term and long-term goals, action plans to achieve these goals, and an understanding of the organisation’s current situation and foresight into the future.
A well formulated strategic plan should align everyday operations and decision-making process with the bigger picture of the organisation while empowering staff to make informed decisions in response to business opportunities and challenges.
It also mobilises various departments within an organisation to work towards a shared vision and goal.
Most business owners, although aware of the importance of a good strategic plan, don’t focus on long-term strategies. They often have preconceived notions of the strategy planning process to be time consuming and beneficial to only large corporations or are fearful of taking the company in the wrong direction.
Regardless of the size of the organisation, it’s important to understand the strategic planning document is backed by thorough research and detailed discussions with management, employees and various stakeholders.
Often, starting the process of strategic planning sparks insights into the inner workings of the organisation while driving innovation and creativity during the brainstorming process. At the very least, the strategic plan is most effective when it’s being reviewed and updated yearly. This serves as a reminder for management and employees to align goals and work towards a common vision while remaining agile and adaptive.
Strategic planning begins with setting a clear vision and goals for the business – by asking the question ‘where we want to be?’ It’s then often followed by a reflection of ‘where are we now’. A SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis helps with this process.
The strategic plan then takes the shape of ‘how do we get there’, a map to get from where we are now to where we want to be. This journey inevitably includes a growth strategy by exploring new markets, deciding whether to invest in research and development to develop new products or services, competitor analysis, implementation funding, HR and employee needs analysis, and governance.
We often find companies strategic plans are underweight in three critical elements:
- Where to compete – what are our target markets, are they big enough to support our growth, and who are the competitors we’ll be competing against
- How to compete – how do we differentiate ourselves in our chosen markets (price vs. service, for example)
- A robust business model that has flexible assumptions allowing “what if” scenarios to be assessed.
As much as lessons from the past and the current state of affairs help with implementing strategy, it is equally important to look at the business with a future lens such that opportunities are not lost in the process.
Having a clear vision for the future helps to unlock potential opportunities while also enabling the business to be better positioned to deal with uncertainties and future dynamics. The final steps involve communicating the strategy to employees and implementing it across the organisation.
Eventually the strategy needs to be measured and evaluated for its success. As tedious as this may sound, a business aware of its current situation is the one that ultimately has an edge over its competitors.
A strategic plan for not-for-profit organisations will have the same key components, usually with a focus on organisational strategy designed to maximise the benefits or impact they provide to stakeholders.
Standardising policies and structures help employees navigate their way, leading to operational efficiency while also enabling management with clearer performance targets to achieve. Planning, identifying, documenting and sharing best practices also ensures that knowledge does not walk away with key people as they leave a company.
Clearly articulating cultural values in job descriptions helps to attract the right talent and to sustain culture within the organisation. Breaking down goals to outcomes as inputs, activities, outcomes and impact also makes it easier for impact measurement in the future.
Access to an excellent strategic plan enables organisations to set up orderly operations and predictable performances which becomes crucial when the world around us is in a state of flux.