Strategic Planning Process In 5 Simple Steps

The key to business success may as well lie in strategic planning - something 90% of organizations fail to execute successfully. The truth of the matter is, companies using strategic plans are more profitable and given the sheer number of businesses that fail, if you do it right, you will undoubtedly stand out and be better-situated to beat your competitors.

What Is Strategic Planning?

Strategic planning is the method of developing plans to achieve overall long-term goals. It's a business management strategy that will help you communicate your activities, plans, and actions necessary to meet your goals.

The basics of strategic planning include setting priorities, focusing resources properly, and

adjusting your organizational direction. It involves aligning all the stakeholders, shareholders, and employees with the goals and working together as a business to meet those goals and achieve a common vision.

How to Develop a Strategic Plan

The strategic planning process is broad, intricate, and involved. The development phase will take time because the strategy needs to be highly detailed, well written, and research-intensive. Here are the five simple steps of creating well thought out strategic planning.

1. Determine What Your Current Strategic Position Is

Before you start, it's imperative for you to understand where you currently stand. This will help you determine your way forward and the best way to get where you intend to go. Ensure that all the stakeholders are involved from the start, both from internal or external sources. Brainstorm with everyone involved to identify the key strategic issues.

Get customer insights, and collect market and industry data as it will give you a clear picture of your position. Take time to analyze the market, industry, and competitor trends. Consider external factors such as pricing trends, product fads, government regulations, consumer issues, and industry growth rates.

The more thorough you are in researching these areas, the more effective your strategic plan is likely to be. It's imperative for you to understand the industry and differentiate your brand from the competition. You also need to document your internal strengths and weaknesses and discuss how the business can grow and fill the industry's consumer needs.

2. Conduct a SWOT Analysis

Once you're done researching both external and internal aspects of your strategic plan, it's time for you to put together a SWOT analysis. In a nutshell, a SWOT analysis is an evaluation of your business's strengths, weaknesses, threats, and opportunities. This analysis should evaluate everything from you, your team or departments, and the entire organization. It's imperative that you take enough time to conduct an in-depth assessment of every individual aspect.

Strengths

Start with the strengths and consider what it is your business does better than any other business and the industry. Do you have a high amount of capital, highly-skilled employees, investors, a large customer base, or low barrier entries

Weaknesses

What are your weaknesses? Could it be a lack of capital, a low-profit margin? A small customer base, or maybe untrained staff?

Opportunities

Identify your opportunities or areas in which your business can excel. Some opportunities include brand recognition, part-time, new product offering, said investors, or anything else that gives you an edge over your competitors and a chance to succeed.

Threats

You also need to identify your threats, and they could be anything that could bring your business down. Some of these include consumer spending power, market trends, product decreasing prices, or a lack of cash flow.

3. Prioritize Your Objectives

Once you have your SWOT analysis, it's time for you to determine what objectives will help you achieve your goals. These objectives need to be in line with your mission and vision, so start by asking some vital questions like which initiatives will significantly impact achieving your goals.

What are the most important impacts of your business? Are you looking for more revenue or customer acquisition, or something else? Which of your initiatives are most urgent? What do you need to accomplish those goals? How will you measure your progress and determine you have already achieved a goal?

The answers to these questions will help you figure out a better strategic plan. All your objectives need to be distinct, but also measurable. It's better for you to have SMART goals and key performance indicators that will help you figure out the timeline and resources needed to achieve your vision.

4. Develop Your Plan

With the objectives in hand, it's time to get down to the details and develop your plan. This involves determining what tactics you should use to attain your objectives and designating a timeline for all your goals. It's also essential for you to have clear communication of all the responsibilities and who they fall on. Utilize strategy mapping to visualize your plan.

It's at this stage that you need to develop a mission statement to define your goals and a vision statement that explains how you'll meet the mission statement. Consider where you want your brand to be in the next five to ten years, how you intend to interact with customers to improve their lives, and how your business will impact the industry or consumer market.

It's during this stage that you also have to define your budget as well as the financial and staffing needs that will help you achieve your goals. Every team or department needs to play a role in determining what they need in order to support the organization's overall mission.

5. Plan Execution

Once you have the plan, the next course of action is to implement it. The first step is

communicating it to everyone in the organization through relevant documents. Map your

processes and use KPI dashboards to communicate responsibilities to the teams. It's crucial for you to review individual contributions to the project and determine checking points to always make sure that everyone is on track.

It's essential that you review and revise the plan during the final stage so you can re-evaluate the priorities based on past failures and successes. Determine what KPI's every team has met and whether they can continue to do so at least on a quarterly basis. It's also vital to re-evaluate priorities at least once a year and make necessary changes to stay on track with the organization's long-term goals.

The Key Takeaway

Strategic planning is a critical part of any business. Keep in mind that this is an ongoing process where you have to measure what's working and re-evaluate your priorities to change what's necessary. Also, make sure that everyone is on board with the plan and that their core values align with the company's overall mission.