Growth Online
Business Management:
Develop a Strategic Plan
Articles
by Roy Posner


You set the direction for the company by developing a strategic plan. A strategic plan that is well conceived and implemented can really energize the company to new heights.

You develop a strategic plan by creating a mission statement, establish your goals and business values, develop strategies to carry out your goals and values, and then develop specific action plans to implement each of the strategies you set forth. Finally, you communicate this to your staff, and have them implement the plan. This process is explained below.
 

1. Build Mission Statement

A company's mission defines its central purpose, sets forth its core values and long-term goals, and provides guidelines for its future growth.  An effective mission statement helps a company-

  • select which markets to focus on
  • identify which customers to seek
  • define new types of products and services for development
  • determine what kind of people to recruit
  • decide what type of organization to build
  • set challenging, but realistic long term financial goals

Mission statements can be brief or long.  The important thing is that they clearly communicate to managers and employees what they should know about the company's future direction.  In preparing a mission statement, it is a good idea to begin by reflecting on what the company has been in the past and is today, and then think about how it will be different in the future. 

For example:

"XYZ Computers is a specialty retailer {Describe the Needs the company Aims To Satisfy] of personal computers and Internet products and services {Describe the Products & services the company wants to provide} serving the Napa Valley {Describe the Geographic area the company wants to serve}. 

Our mission is to become the best single source supply of integrated, customized, Internet-ready personal computers and servers in the Napa Valley {Vision of what the company wants to become}.  In order to achieve this, we will expand our single store location so we can offer a wider variety of mid to high end products, including Internet servers, software, and communication devices {Overarching Goals that the company aspires to achieve in the future}. 

We will strive to make the retail experience of our customers a delight by exceeding both their needs and expectations, by providing them with the most reliable and up to date information on products and emerging technologies, and by offering a superior level of customer service {Core Values that the company wants to implement in the future}."

(In defining your mission, you might want to consider opportunities available to the company in the marketplace.)


2. Define Business Values

A value is a belief, a mission, or a philosophy that is really meaningful to the company.  An example of a business value is: "Customer Satisfaction."  Another example of a value is "Being Ethical and Truthful."  Every company has one or more values, whether they are consciously aware of it or not.  Another way of saying it is that a value is a statement of the company's intention and commitment to achieve a high level of performance on a specific QUALITATIVE factor.



In many recent business management books and journals, developing, adopting, and implementing values has been identified as perhaps the single key in the success of high growth, high profit companies.  A passion for a value and its implementation into the daily activities of work was identified by many as the single key to their business success.

For example, Merck, the pharmaceutical company became so successful in its field because the company was so dedicated to the value of "high quality and purity of its drug products."  Because of this perceived value, distributors felt secure carrying Merck products, and felt confident recommending the products to their customers.

When defining a value, it's a good idea to try to describe it in detail.  For example, a company may adopt the value "Customer Delight."  That's the value's name.  The detailed description for the value could be something like: "We recognize that in today's highly competitive market providing excellent service is not sufficient to satisfy customers and ensure their loyalty. Our goal is to convert the customer's interaction with our company into a thoroughly and unforgettably enjoyable experience."  You are describing how the value can uplift a company in general, or your company in particular. 

(For more information on developing values, click here.)



3. Define Goals

Goals are the broad, primary quantitative results that management seeks to achieve in the plan.  These goals can include specific financial performance results that you seek to achieve, such as higher revenues or higher profits (e.g. "Increase Sales").  They can also include goals to increase the energy level in the company (e.g. "Improve leadership & direction"), and to strengthen any of the five engines (e.g. "Improve Organizational Efficiency" for improving the Organization engine, or "Develop new innovative line of products/services" to improve the Technology engine).

When we state a goal in general terms, it may be difficult for people to know when or whether we have achieved it.  Each general goal can be broken down into sub parts and defined in quantitative terms.  These are usually are defined in terms of-

  • a dollar value of money to be raised, earned or spent

  • a percentage improvement on any factor such as closing ratios or customer satisfaction

  • a measure of speed or time for completing a action such as new product launches

  • a specific date by which an important action or result will be achieved

Example Goals: "Increase Sales by 25% in Qtr1", "Increase Profits by 10% in Qtr1"  


4. Develop Growth Strategies for Values and Goals

Values and goals tell us what we want to achieve.  Strategies tell us how to achieve them. Develop a series of strategies* to implement each of the goals and business values you have established.

For example -- 

Goal: "Increase Sales by 25% in Qtr1" 
Example Strategy/Objective "Expand Training Curriculum on Sales and Customer Service."   


Business Value: "Maximum Utilization of Resources" 

Example Strategy/Objective "Evaluate all Machinery for waste,"  "Sold all very old unsold stock immediately"

Business Value: "Concern for People" 
Example Strategy/Objective "Evaluate and develop the best compensation methods,"  "Get feedback on how to improve things at all levels."

(For a listing of general strategies for business improvement, click here.)

*When you are confident in the strategy that you wish to implement for a goal, you can then consider that strategy an objective (for the goal). Thus for each of your goals you develop strategies, which, when satisfied with, you call your objectives for the goal.

 

5. Evaluate and Overcome the Company's Negative Propensities

To assure that your company successfully accomplishes its goals, you will need to overcomes any internal negative habits, attitudes, values, etc. that could retard such growth. Once you identify these negative propensities, you can incorporate them in your action plans for improvement as explained below.

Examples:

-"People must get to work on time. Punctuality is a must for a 24/7 company."

-"Find out why we are unresponsive to customers."

-"Get people skilled in areas that are lacking."

How do you know which are the company's wanting propensities? We would suggest you evaluate the organziation against a series of questions to determine what is wanting. Evaluate the company on these (e.g. ask a few people their opinions on these questions), and then incorporate plans for improvement in your action plans.

(Click here to see a list of those statements on which to evaluate the company. There are corresponding statements for each of a retail, manufacturing, wholesale, and service business.)



6. Develop Action Plans to Implement Strategies/Objectives and Overcoming of Negative Propensities

At this point, you might want to reorganize your mission statement to insure that it includes your latest new take on things.

You are now ready to convert your strategies/objectives, as well as your ideas to overcome your negative propensities into a set of time-bound actions for implementation. You then actually carry out the actions. As actions are carried out, you can then update progress on the actions, and identify those areas requiring greater attention. Here is some of the information to include for each action of a strategy.

  • (Action) Name
    For a given strategy/objective, or negative company propensity (e.g. "Evaluate all Machinery for waste"), enter the action to do(s).

    -E.g. for the strategy/objective "Evaluate all Machinery for waste," enter the to do "Evaluate staff's ability to evaluate machinery," and "Consult vendors on documentation for assessing efficiency of machinery."

    -
    E.g. for the negative propensity "Get people skilled in areas that are lacking" enter the to do "Have each project manager survey team members for lacking or deficient skills."

  • Start Date
    Enter the start date for the action (e.g. 9/1/04).  

  • End Date
    Enter the expected completion date for the action (e.g. 1/1/05).  

  • RP
    Select the person(s) responsible for carrying out this action. (Mary Jones).

  • Current Status
    Enter the latest status in your implementation of this action  (e.g. "On Schedule").
      

Enter into a list all of your to do actions for each strategy/objective, and negative propensities that you want to implement.

7. Communicate the Plan to the Staff
Tell appropriate groupings of staff what is required of them by distributing information of the mission, goals, values, strategies, negative propensities, and action plans to appropriate people. If necessary, gather further consensus.



8
. Have Staff Carry Out Plan
Note: Make sure the staff has the proper skills to carry out the actions. Also, be sure that job positions are optimized, activities are optimized, and systems are optimized to carry out the plan. For more on this, click here.



9
. Revise The Plan

A strategic plan is not intended to be a static document cast in stone.  As circumstances and conditions change, plans must be altered in order to take maximum advantage of emerging opportunities and to respond to new challenges. After the plan has been prepared, a variety of circumstances may arise requiring you to revise the content of one or more action
actions.  It is recommended that you update all actions in the program at least once per month.
The most common form of revisions involve changes in the start and end date, and the creation or revision of the content of actions. 

--------------------

Insuring Success

Some of the keys to a very successful outcome to your plan are:

  • Not biting off more than you can chew when developing your original goals and objectives. Doing what can be done. I.e. not hoping to accomplish something too broad and wide.

  • Insuring that you have the resources, organizational prowess, finance, etc. to enable the plan to work

  • Being honest about the company's negative propensities, and overcoming those areas that the company is currently weak, and including it in your action to dos.

  • Having real commitment to the plan. I.e. do you REALLY want to do this. If not, there is little chance for success.

  • A complete buy in by others to the plan

  • Staying focused on the plan and not drifting off into other areas, causing the plan to get diluted over time. This is very important!

  • An unfettered determination to carry out the plan, marked by intensity and focused hard work.

  • Implementing values down the greatest detail of work (i.e. perfect execution of values).

  • A commitment by appropriate individuals to the start and finish dates of your action to dos.

Additional Thoughts on Strategizing in Business


RELATED INFORMATION:

  • For the keys to business success, click here.

  • For important mini insights into business success, click here.

  • For a discussion of the process of personal growth accomplishment for a person [essentially a strategic plan for the individual], which mirrors for the most part the stages of the strategic plan, but with far more details and with more of the fundamental philosophic basis, click here.

  • You can use Double It! strategic planning software from our sister company GuruSoftware to help you develop a strategic plan. For more information, please click here.

 


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