Business Mechanic: Strategic planning for a small business
Survival is the first goal of a company, profitability is second and growth is third.
Successful companies have been shown to unfailingly have a solid strategic plan which is built on their market, values, culture, and core competence. Although large companies have detailed strategic plans, small companies seldom do. This is unfortunate because smaller companies are more fragile, especially in their first years of existence. Small companies have less resources to cushion them from disaster, lower levels of expertise in many business areas, and a smaller customer base to support them. This is understandable due to the lack of resources and expertise and time to focus on strategic issues. However, not having a plan may prove fatal:
· A study of firms found that 85% were still in business after three years, IF they had developed a business plan at the outset. (Moya K. Mason)
A “Simplified Strategic Planning Process” resolves this issue by providing a complete but streamlined strategic analysis to minimize the time and expense for the planning process. This process takes advantage of the fact that the staff of a small company is intimately familiar with the customers, market and business conditions. Further, a simple plan allows for an ongoing review of the situation and take action to adapt rapidly to changing conditions.
Keys to success –
Understand your business, key customers, competitors and your capabilities
Build your business on a foundation of a unique value proposition
Identify critical constraints holding you back and develop a plan to remove them
Rank the following and have others do it from 1 lowest to 5 highest.
Define the business you are in, COULD be in, and SHOULD be in.
Compare yourself with the competition and identify your unique selling proposition.
Identify changes needed to increase your competitive advantage.
Identify, differentiate and satisfy your key customers
List current talents and abilities, and identity critical competencies for success
Identify any critical constraints holding you back and plan to overcome them
Action items –
Answer the above questions in writing and discuss them with others
Establish goals needed to achieve the objectives identified in your analysis
Review your results with your coach.
