Everyone dreams of being able to predict the future. People who create a strategic plan in their company for many years ahead have this skill to a large extent. How and why is such a plan created? Let's check.
What will you learn from the article?
Running a business means constantly making decisions, planning and predicting the future. That's why visionaries in business play such a key role. What makes some entrepreneurs not only able to see future opportunities, but also successfully implement them?
In the article, we will look at how visionaries work and what steps should be taken to create an effective strategic plan for the company. We will discuss the stages of creating a strategic plan, its key elements and the strategic planning process. We will also consider the advantages and potential disadvantages of such a plan. If you are a business owner and want to learn how to effectively plan the future of your business, this article is for you.
In times of war, the greatest compliment to an enemy is to say that he is a good strategist. It's no coincidence commanders who could predict the future with many moves ahead most often won major battles. What distinguishes a chaotic business from a well-oiled machine is also an appropriate plan for the future. We distinguish plans:
- operating - relates to the current operation of the company for a month, quarter or year.
- tactical - indicates the company's tactics for the next 1-5 years.
- strategic - includes a strategy in the longer term: 5-10 years.
How do visionaries work?
To some extent, the vision of the company's strategy derives from the operational and tactical plan. True visionaries, however, start from the flip side: they create a bold strategic plan and then adapt the tactical plan and day-to-day operations of the company to that. Most of the techniques supporting productivity or achieving goals are consistent with this philosophysuch as the snowball method, small steps or atomic habits. In short: a clearly defined goal can then be broken down into smaller, daily activities that are part of the operational plan. This approach also helps with a clearly defined mission i company vision.
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Strategic plan of the company - stages of creation
When setting personal goals for the next 5 or 10 years, you can largely fall back on your dreams. In the business world, however, there are 3 specific stages of creating a strategic plan, only one of which relates to the owner's needs and aspirations. These are the analyzes:
- needs - it is this component that allows you to consider the expected market share, company size or revenues. The specific questions posed at this stage depend on the nature of the business and the stage of development of the company.
- enterprises - concerns the company's capabilities and resources.
- the environment - takes into account all factors that determine the company's environment and affect competition, social and economic conditions.
As you can see, creating a strategic plan in these three stages overlaps to some extent with techniques such as SWOT analysis or Porter's five forces analysis. All such analytical techniques allow you to collect conclusions that will later be useful for creating a strategic plan. Each of its stages can be treated generally or broken down into really small steps and areas. The more data, the more accurate the conclusions. For example, the analysis of an enterprise may consist of customer satisfaction survey if marketing audit.
What is in the strategic plan?
Strategic plan what does it mean in practice? On the one hand, it must operate in generalities to a greater extent than a detailed annual or quarterly plan. On the other hand, it is worth sticking to certain values so that the goals do not become blurred among generalities. When creating a plan, remember about the scope and area of operation of your company. So avoid very simplistic claims like “more market share” or “more profits”. Then you lose sight of the company's capabilities and the actual goals you want to achieve.
Rather, try to include at least indicative numerical values in your strategic plan, e.g. reaching at least two new voivodeships with your offer or increasing your turnover by a specific amount. The second element of the strategic plan is to define the directions of expansion and limitation of activities. Then you can identify ways to increase revenues, innovation and adaptation activities and the size of your resources - now and in plans.
As you can see, each value follows from the previous one, What allows you to create a coherent, realistic plan together. If you break them down using the steps listed here, it will be easier for you to make any modifications. If, for example, it turns out that you need to collect more than expected resources, you can clearly see that you also need to modify innovative and adaptive activities or directions of expanding and limiting activities. Suddenly, difficult decisions, many years ahead, become simple, because you will see the expected results at a glance.
The strategic planning process - what is the process of creating a plan?
The strategic planning process is a key tool in achieving success for any organization. It requires not only smart decisions, but also creativity and visionary thinking. Strategic planning allows you to gain competitiveness, but only if it is carried out with commitment and knowledge. In today's fast-changing world of business, not having a strategic plan is one of the biggest mistakes an organization can make. Therefore, it is not surprising that enterprises are looking for professional strategic planners to help them bridge the gaps between current performance and future goals.
A strategic plan helps support the organization's key activities and the achievement of company goals. Strategic planning includes e.g. identifying the organization's weaknesses. A good plan is something that not only giants, but also small companies need to achieve their strategic goals. This requires the involvement of all team members who, in order to implement the company's mission, must have clearly defined directions of action, which are defined in the strategic action plan.
Advantages (and disadvantages?) Of the strategic plan
Strategic planning brings a number of benefits to the company:
- better protection against variables and market crashes,
- greater resistance to competition,
- ease of making decisions on a daily basis - there is a long-term strategic plan behind them, an example of thinking ahead,
- realizing in advance the limitations, potential or threats facing the company,
- easier management and more effective supervision.
Companies that are consistent branding, communication strategy or marketing, they most often operate on the basis of a strategic plan that provides the framework and goals for every small business activity in the company.
Do strategic plans have any downsides? As long as the assumptions behind the plan are correct (company's capabilities, environment), there is only one possible disadvantage of a long-term strategy. The greatest business successes are not only methodical planning, but also visionary moves that go beyond what seemed possible so far. New technological opportunities or changes in the market appear today sometimes almost overnight. Planning for 5-10 years ahead does not take these changes into account.
Hence the paradox - sometimes it is companies with a far-reaching strategy that adapt to market changes most slowly, and react to trends only after years. As we wrote in the tactics article agile marketing, today the reality in the business world is too unpredictable to cling to long-term plans. Apart from the current course corrections, however, it is worth keeping in mind the destination of the ship sailing under the company's flag at all times.
Worth knowing:
What is a strategic plan?
A strategic plan is a detailed and long-term action plan that aims to achieve specific business goals. This is usually a management-level document that provides guidance for the entire organization. The strategic plan includes analysis of the market, competition, trends and directives in order to develop a strategy that will allow you to gain a competitive advantage and affect the success of the enterprise.
What areas does the strategic plan cover?
Depending on the size and industry of the company, the strategic plan may cover different areas, such as marketing, finance, human resources and production. A properly developed strategic plan can help a company make decisions and achieve its goals with a long-term future in mind.
How to prepare a strategic plan?
A strategic plan is a key element for any organization that allows it to achieve its goals. However, for it to be effective, it requires a solid strategy and proper preparation. It is important to remember that a strategic plan is not only a set of goals, but above all a comprehensive strategy that includes market and competition analysis, risk management and the use of the latest trends and technologies. As a result, the strategic plan gives the organization a clear and distinct vision of the future, which will allow it to achieve success for many years. Therefore, it is worth spending time and properly preparing a strategic plan to achieve the intended goals and take a significant step forward towards the development of your organization.
What are the elements of a strategic plan?
The strategic plan is a key document that defines the goals and objectives of the organization and the strategies that will be used to achieve them. There are three key elements that must be included in a strategic plan. The first and most important element is the organization's mission - why it exists and what it wants to achieve. Then strategic goals and objectives that define the direction the organization wants to follow. And finally, the strategies and actions the organization will take to achieve its goals. A strategic plan is the foundation of business success. Without it, the company can move towards an unknown destination, leading to losses and unnecessary frustration.
When is it worth developing a strategic plan?
A strategic plan can be a very important tool for any company or organization - at any moment of its existence. Planning future activities allows you to define goals and strategies that are crucial for further development and success. Without a strategic plan, an organization can run chaotic and inefficiently. Planning for the future, both in the short and long term, allows you to better adapt to changing market conditions and customer needs. Therefore, it is worth considering developing a strategic plan to avoid the risk of losing competitiveness and the necessary position on the market.