In our role as consultants, my partner and fellow professional speaker, Kristin Arnold, and I assist organizations with developing Strategic and Operational Plans. As business owners, it is appropriate that we practice what we preach and what we teach.
When we assessed the size, scope and complexity of our businesses, we allocated two days for this important task. When done, we’ll celebrate the accomplishment by doing something special for ourselves. We always recommend conducting these sessions and celebrating the accomplishment, off-site.
A great place to begin is the Business Plan, the source document describing the business. What follows are the “business basics” that should be reviewed and updated every year at a minimum:
The Business: including a general description of the business, the history, values, vision and mission;
Products/Services: including the relative importance and benefits to your clients from each product or service, the life cycle, evaluation (performance, timeliness, ease of use, certainty), competitive comparison and differentiation from other products / services;
The Market: including demographics on your current and targeted customers, your market segmentation, market research and trends, pricing strategies and marketing and sales strategy;
Competitive Analysis: including your nearest direct and indirect competitors (which may not even be in your industry);
Physical Location of Business: including building/space needs;
Management: including an organizational chart with key individuals and responsibilities, resumés, strengths and weaknesses, planned staff additions, other resources needed, and payroll expenses
Personnel: including current staffing and needs, future skills required, hiring and training plans, labour pool availability;
Potential Risks and Problems: including legal, regulatory and tax implications;
Financial Statements and Projections.
The Operational Plan is an extension of the business plan. Its essence is contained in the question, “What are we going to do this year and how are we going to do it?” The resulting answers are key activities that get folded into the annual budget. This is called “blocking and tackling” — taking what you know to be true about your business currently and creating a plan that takes it to the next level.
The next critical document is the Strategic Plan, which looks beyond the one-year horizon and extends your vision out three to five years Typically, it is a review of the business basics (sometimes called an internal scan or SWOT) as well as an environmental scan — what’s happening in the outside world that could affect the business.
Next comes “Strategic Thinking,” which identifies where we want to be by the end of our Strategic Plan horizon. This is your desired “vision” of the future. The Strategic Plan is created and re-created to close the GAP between where you are now and where you want to be.
It also makes the assumption that you will continue your day-to-day operations. You may opt to stop doing some things, change the way you are doing others and even take on new things in order to support the updated direction of the business.
Rather than thinking year to year, strategic thinking requires you to see long-term then ask, “What needs to change in order to be successful in that desired future?” What I have said earlier about your personal actions applies to your business as well: you can’t hope to have a different result in the future if you keep doing what you have always done.
The strategic plan is about breakthrough improvements — figuring out where you want to be — and then determining the strategy to get there. These key initiatives and activities are then made part of the budget.
I have been in business for over 40 years now and I plan on staying in business for 20 more. It would be absolutely ridiculous to think that I can keep on doing the same things and remain successful. I know this because I am not doing the same things I was just 10 years ago.
Invest a few days to work ON vs. IN the business. Review and update plans, then take time to celebrate new ideas, opportunities and directions.
My question for managers this week is, “What are you doing to plan for a successful 2013 by engaging your people in the process and determining a positive outcome for your business this year?”
Joseph Sherren, CSP, HoF, and CEO of Gateway Leadership Inc. is P.E.I.’s management effectiveness expert who works with organizations to maximize leadership performance, employee morale, and bottom-line results. Kristin Arnold, MBA, CMC, CPF, CSP, is a certified professional management consultant, facilitator and speaker.
