Excerpt


Introduction

Strategic planning is a fairly common activity in most large corporations as well as government organizations. But if you havent been involved in strategic planning projects as part of your business experience, it may still sound a little foreboding. If so, we will try to dispel those concerns as we proceed through this book. Strategic planning is not a secret art known to only a few it is just a logical and practical process for trying to look into the future and make judgments about the best course of action based upon organization goals. Three things are required for strategic planning to produce a successful result. The first is the need for a step-by-step process that helps to generate the right kind of information needed to produce a valid plan. The second is a lot of hard work and research to provide the most accurate information possible in creating alternative courses of action. The third is that the decision making must be heavily laced with sound business judgment. All of those involved need to understand the process and be operating from the same page so that the most benefit can be achieved.

What is a Small Business?

Since this is a book designed for strategic planning for a small business, what is our definition of a small business? A small business for these purposes is one having 100 or fewer employees. That is not to say that this process is not valid for a larger business, just that the focus here is specifically for the smaller businesses. The major difference between strategic planning for a large business and a smaller business is typically a matter of financial resources. The larger businesses usually have deeper pockets and can afford to bring in an expensive consulting team to lead the effort and manage the process for these periodic planning activities. A smaller business must often rely upon its internal resources to do the job and thus must be more direct and efficient in executing the process.

The execution differences are usually in the scope and depth of the analysis required to produce a reliable end product. As an example, most small businesses dont have an extensive product line, with broad international distribution and competitive issues that are typical of larger corporations these days. This simplifies the work for the smaller business but does not eliminate the need to address all of the relevant issues within their environment.

Purpose of Planning

It is not unusual for small business owners to decide they need a strategic plan without being fully cognizant of why they have arrived at that conclusion. During my strategic planning seminars the participants express a variety of concerns. For example, things are not going as expected, they just have a deep-seated uneasiness about the future, or they want to move to the next level. Often they have attained their present level of business success without a strategic plan and yet dont feel confident about proceeding without something more definitive than continuing by the seat of their pants. They recognize the need for a more stable and predictable management style and this often leads them to search for a planning solution to fill the void. At the same time they arent at all sure what strategic planning is and what it will do for them. All of these are excellent reasons for investigating the strategic business-planning route. This leads us to the need for a definition of strategic business planning. You wont find many formal definitions in this book but the following simple definition of planning is worth remembering.

The purpose of planning is to "identify, initiate and manage change!

This definition contains all of the primary principles and concepts of strategic planning. The important elements of your strategic plan will reflect your understanding of this definition for your specific business. For now, just consider that the reason your are pursuing a strategic plan is that you need to increase your comfort level about the future. You know that the key element of your concern about the future is what will be different and how do you maximize the benefits and mitigate the risks from that difference. In this context, difference equals change and so change is the overriding strategic planning issue.

The Three Strategic Planning Questions

We will be using a 10 Step Strategic Planning Process Model as the primary guide to develop a strategic plan. What you will learn is that the process model is designed to address change by answering three simple questions:

Where are we now?
Where do we want to go?
How do we get there?

You have probably come across these questions somewhere in your past but they may not have been meaningful because of a lack of context to apply them. They are so simple that many business people tend to overlook them as insignificant. Their mistake is to assume that important initiatives require complex concepts. Rarely is this true. More often the concepts are simple and the execution is complex. In this endeavor these three questions are extremely important and you will see how critical it is to answer them completely and accurately in your plan.