Image source 1: Forbes
Nothing in life is inevitable, yet you have to anticipate potential threats to safeguard your business from unforeseen challenges. While it’s beyond humans’ capabilities to predict the future accurately, companies can map out their destination and ways to get there.
A well-structured strategic plan serves as a roadmap for businesses that gives direction to a business and allows the business leaders to take precautionary measures to overcome the potential challenges. Any company – be it an e-commerce firm or an academic assignment help service- is likely to get wrecked in the competitive landscape without a concrete strategic plan.
What Is Strategic Business Planning?
Strategic planning is developing a company’s direction to achieve overall business goals. With a strategic plan, you can identify:
- Where your business is now?
- Where are you heading to?
- How can you mitigate potential risks to get to your destination?
Why Is Strategic Planning Essential For Business?
Strategic planning is crucial for strengthening five key business areas:
1. Business objectives:
When you have a clear picture of your company’s goal and a roadmap to get to your destination, it helps you become more proactive. Instead of getting worked up about the challenges beyond your control, you can make strategic moves to overcome unfavourable scenarios and stay as par with the latest business trends.
2. Operational activities:
A well-defined strategic plan helps business leaders assess available resources and costs. It makes it straightforward for the CEOs to decide whether to invest in further development or not.
3. Competitive landscape:
The business landscape is evolving at a rapid pace. Business leaders must keep up with different government regulations, technological advancement, shifting workforce, and financial uncertainties – and that’s where a strategic plan can help you rise above the challenges.
Reviewing your company’s challenges, strengths, and opportunities will help you upgrade your existing strategy to meet different challenges. Be it a new product launch, dealing with competitors, or technology upgrade; a strategic plan can prepare you to deal with tricky situations and increase your profitability.
4. Employee performance:
For a company’s overall success, all stakeholders must be on the same page. A strategic plan helps communicate its vision to its employees, managers, and other associated personnel. It generates ideas and sets realistic goals that motivate employees to give their best efforts to meet their overall goals.
5. Business longevity:
Running a business is no cakewalk – especially with the changing economy, marketing trend and customer demands. Companies without a solid strategic plan are more likely to struggle in the longer run. Reports show that businesses with a solid strategic plan generate high sales revenue and successfully meet their organisational goals.
6 Must-Know Strategies For Building A Solid Business Plan
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Building a strategic plan for your business is a long-term process. It is more detailed and should be upgraded as required with the changing business trends. Here are the key strategies to create a strong business plan for précised execution:
1. Define your business goals & targets:
You cannot derive effective strategies for your business if you don’t have a clear vision of the future. To develop a clear vision, think long-term and understand what kind of business you want to build and who your target customers are. Without a target audience, you will likely suffer and drain out your resources.
Clear vision and targeting allow businesses to adopt suitable strategies for executing marketing activities and increasing sales and productivity. Also, set goals you can meet and measure success. For instance, you can use Key Performance Indicators (KPIs) to measure your progress.
2. Understand your industry, business, competitors & customers:
You cannot build successful business strategies without studying the industry you are part of. You have to dig deep and analyse your industry and your main competitors. Learn how they are operating and their primary source of funding.
Understanding their price trends and offered products and services will give you an idea of the customer base and the products and services they are looking for. You have to analyse every factor critically, so you know what you are up against and if you are well-equipped with the necessary resources.
A thorough evaluation of these external factors will help you learn about the market trend and the challenges that can impact your business.
3. Conduct a SWOT analysis
Most businesses complete a SWOT analysis to identify the strengths, weaknesses, opportunities, and threats. A SWOT report allows you to get a better idea of your industry and the target audience. In business,
- Strengths: Employees, market positive, customers, financial resources, products, sales, productivity, etc.
- Weaknesses: Low cash flow, high competition, unstable market position, inferior quality products, low sales, customer complaints and so on.
- Opportunities: New alliances, product launch, raising fund, resolving customer complaints etc.
- Threats: Government policies, competition, changing economy, insufficient funds, limited sales and cash flow etc.
A SWOT analysis is more of an internal evaluation of a business. It helps you identify the potential challenging areas to adopt suitable strategies for developing your business plan.
4. Define departmental level objectives:
Now that you are aware of your business goals, target audience, competition, and your company’s strengths and weaknesses, shift your focus to individual departments and their principle objectives.
Each department – from the production team and IT team to the operations team and human resources is responsible for your plan’s success. Let’s say you want to improve the sales of your products. It falls on the sales and marketing team to develop suitable strategies to reach the target sale.
However, be realistic with your departmental level goals. Setting high targets will add pressure and hamper productivity. Instead, focus on short-term goals that your employees can achieve within a year or two. Follow a “SMART” (Specific, Measurable, Achievable, Results-Focused, and Timebound) plan to reach your target within a specific time.
5. Long-term plans for staffing, budgeting, and financing:
Sure, it isn’t easy to plan long-term when the business scenario is continuously evolving. But if you set short-term goals like quarter to quarter, it will restrict you from taking advantage of the possible opportunities.
That’s why after you set goals, look into the overall budget of your business and evaluate if you have sufficient to carry out your initial plan. If not, you can lower your target goals or raise the necessary funds to meet the objectives.
Talk to your manager and make them a part of your plan. With a collective input, you can achieve your goals beyond your expectations.
6. Adapt to the changes:
Many businesses struggle to survive the competition despite a definite strategic business plan. Even if you have a “perfect” strategic plan, sometimes it may not be sufficient to deal with an unforeseen challenge. No business scenario remains the same year after year. You must expand your mindset and adopt change.
On the brighter side, just like challenges, even opportunities appear out of nowhere. Hence, you must be ready to grab the opportunity and make the necessary changes to your plan. Also, conduct a weekly review to evaluate the progress of your strategies. Based on the reports, make necessary changes.
However, avoid the temptation of making frequent changes. Regular changes will confuse your employees and leave you struggling to reach your target. Modify your plans only if it’s not generating expected results or you have come across better opportunities.
Strategic planning requires months of research, critical analysis, and hard work. Even though it’s a time-consuming task, it plays a significant role in protecting your business from unforeseen challenges and helping you reach your business target. Hence, if you are looking to promote a new venture or upgrade your existing business plan, do it now. With a concrete strategic plan, you can take your business to a new height and generate your expected ROI.
Olaila lee is a financial advisor in one of the USA’s most reputed firms. She is also associated with MyAssignemnthelp.com, where she offers finance-related homework help to students.