If you critically analyze the biggest players in your industry, you will find one similarity: they didn’t stumble upon success by accident. They got to where they are through well-thought-out strategic planning.

Strategic planning is more than following set rules. It is the process of giving your company a sense of direction by analyzing where you are currently and where you want to be. Think of it as a plan of action that enhances success and growth for your mid-sized company by clearly defining the path that your company should take.

Why Do You Need to Have A Strategic Plan For Your Company?

Whether your company is a start-up or in the growth stage, you will never achieve your goals without a clear course of action. Here are the key benefits of having a strategic plan:

1. Increases Operational Efficiency

A strategic plan outlines a clear path for the company, making it easy for resources to be channeled towards the most critical business aspects. The management can effectively monitor these resources to enhance effectiveness and reduce wastage.

With the plan in place, you can easily measure your growth and determine your progress by looking at the set goals and KPIs.

2. Increases Durability and Sustainability

The industry and economy are constantly changing. Without an effective way to identify potential stumbling blocks, whether external or internal, the company may find it difficult to navigate the market.

Strategic planning prepares your business for whatever hardships it may face in the future and makes it more adaptable to the dynamic consumer demands and industry trends.

3. Encourages Proactive Behavior

Can your company ride out the next wave of economic difficulties? Strategic planning keeps your company ahead of the competition by providing it with a strong foundation. It enables you to look out for potential opportunities in the market and benefit from them.

Most importantly, it gives your employees a sense of accountability and positions your company for future success.

4. Helps with Decision Making

There are three strategic anchors — defining areas — that distinguish you from the competition and make your product, process, and employees unique in the market.

• Individual leader excellence (coaching)
• Leadership team alignment (team development)
• Scalable training for managers

Once you have fully covered these areas, you should be able to easily answer questions about what you should take on versus what you can confidently say ‘no’ to.

Strategic planning enables you to distinguish between a viable and potentially catastrophic idea and gives you clarity on the projects you should invest in with the resources available.

Essential Aspects to Consider for Strategic Planning

You need to have a deep understanding of your company and how it works against other companies in your industry. Before starting the planning process, you should know:

1. The Current Position of the Company (Starting Point)

How is your company operating internally? How does it compare against its competitors? What is currently driving its profitability, and what challenges are you currently facing? Analyze your company critically so that you are aware of its weaknesses, strengths, opportunities, and threats.

2. Where You Want it to Be (Destination)

Where do you see your business in 5 or 10 years? What are your top-level objectives? Operating a company without a strategic plan is equivalent to running blind. Have a clear picture of your end goal.

3. How you Will Get There (Journey)

You already know where you are and where you want to go. The next most important question is; how do you get there? What strategies or course of action are you going to take to make sure you achieve your company’s goals?

4. Trade-Offs

All great strategies require compromises or trade-offs. What are you not doing or saying “no” to in order to accomplish your goals? Ideally these choices fit together to create an environment that gives your strategy a strong competitive advantage. A strategy without real trade-offs or that is at odds with the current ecosystem or culture of your organization is a sure-fire way to continue business as usual.

5. How to Know Whether Your Plan Is Working (Checkpoints)

The only way to identify whether your strategic plan is working is to have clearly defined checkpoints along the way. This will help keep your company in check and make sure you are headed in the right direction.

You can only create an effective strategic plan if you know where you are, where you want to be, and how to get there.

Key Elements of Strategic Planning

Strategic planning should involve all the stakeholders in your company, including the investors, employees, and managers. This way, everyone will have clarity on what the company is trying to achieve.

Before we dive into an outline of strategic planning, it bears outlining that strategy is perhaps the most misunderstood term in business planning.

Often when we say the word “strategy”, most people will jump to looking at improving their operational effectiveness, go-to-market strategy, clarifying their ideal customer avatar, discuss how to be more competitive in the changing marketplace, or something along those lines.

These are all important tenets coming out of a core strategic initiative, but they are not the first place we need to get clear and aligned on as a leadership team when we talk about strategy. A strong strategic plan defines what every stage of the journey will look like and the goals to be achieved along the way.

Here are the 4 key elements of strategic planning.

I. Defining The Mission and Vision

A vision could be a singular statement, but it carries a lot of weight in the strategic planning process. It is the aspirations of your company and describes what you’d like to achieve. On the other hand, the mission is the ‘why’ aspect of the vision and backs it up. The two combined, gives your company a purpose.

II. What are Our Strategic Anchors?

These are what will make and keep your company unique in its value proposition in an ever-changing market landscape. Unlike values or a mission statement, strategic anchors may need to be re-confirmed every few years, especially in the startup world where new players enter or disrupt the industry rapidly, and the pace of innovation can be extremely high.

Your anchors are the first piece of strategy to confirm. Having a unique ecosystem of complementary strategic anchors (and their ensuing supportive operations) is very hard to duplicate by competitors, unlike features and technology. These anchors can guide you through choppy waters and bad weather.

Well-articulated strategic anchors will also act as the discernment filter on what the company says “Yes” or “No” to as opportunities arise. Most of what we call strategy ultimately just boils down to the difficult and uncomfortable habit of saying “no” to tempting opportunities, competing commitments, and directions (or misdirections), so you can say “yes” to what is most aligned with your strategic anchors.

Many organizations lack the courage to make these hard decisions, land the anchors, and stick with them over choppy waters, inevitably ending them up in a red ocean of “Me Too” competition in the long-term.

III. Confirm What is Most Important Right Now

This is addressed by setting the ‘Thematic Goal’ for the next 6 months as the focus and priority for the company. This goal is either the single most effective leverage point in longer-term success, or addresses the biggest crisis currently facing the company.

IV. Setting Objectives

From this single thematic goal you can confirm between two and five OKR “buckets” that address the goal across several functional domains. Pressure test your key results for these objectives to ensure they don’t fall into pie-in-the-sky thinking that may look promising to board members, but demoralizes the team, and that might ignore any possible unintended consequences from ambitious metrics.

V. Outlining the Approach

Your approach is the methodology you will use to achieve your objectives. It is the execution framework that guides your company towards its ultimate goal and addresses the implementation tactics. The approach should also contain KPIs or checkpoints that will allow you to identify whether the plan is working or not.

VI. Execution

This is the final piece of the planning process, where you get to put your plan to action. The execution process requires you to carry out the plan as directed by the outlined approach.

Lay The Groundwork for Your Organization’s Success

One of the reasons why companies fail at strategic planning is because their plans often lack structure. Take a moment and go back to the basics — the fundamentals of your strategic planning process. If your plan is vague, it seems confusing, or doesn’t give you a clear picture of the end goal, do it once more, this time, following the tips outlined above.

Want any help in this process? If so reach out to us. We will help facilitate and expedite this process and pressure test the results of what you come up with as coaches and consultants to confirm they are good to go.