Strategic Planning for Your Small Business

Strategic Planning for Your Small Business

strategic planningMostly everything you do requires a plan. It doesn’t matter if you are going on a trip, going shopping, picking the kids up from school or operating a small business, it requires a strategic plan.

Forbes has an article on “Five Steps to a Strategic Plan” by Aileron. He states, “A strategic plan looks at all the things your small business could do and narrows it down to the things it is actually good at doing.” Aileron also says that business leaders are able to determine where to spend time, human capital, and money with a strategic plan.

Aileron outlines five steps in the process of developing a strategic plan. They are:

  1. Determine where you are. To determine where your business is, conduct external and internal assessments to get a clear understanding of the marketplace and competition.
  2. Identify what’s important. Where do you want to take the organization over time? This will determine the long-term goals of your small business, as well as the mission and vision. How do you see you company in the future?
  3. Define what you must achieve. What are the objectives your business must achieve to address the priority issues?
  4. Determine who is accountable. This is how you get to where you’re going. The strategies, action plans, and budgets are all steps of the process, which will help determine how to allocate time, human capital, and money to help achieve the objectives.
  5. Review, review, review. Regularly schedule formal reviews of the plan to refine as necessary. This will ensure the plan works as you planned.

Larry Downes discussed in his article, “Why Best Buy is Going out of Business Gradually,” that Best Buy is a company that has waited too long to take advantage of the Internet as a technology. Big box retailers like Best Buy are going the way of the dinosaur. Online giants, notably Amazon, are the future. Although Best Buy has a website where a shopper can order online, they have to pick the item(s) up at one of Best Buy’s stores. Apparently, there was no strategic planning to prepare the company for this new channel nor any tactics in place to compete with Amazon. Best Buy’s strategy focuses on protecting the market share, while Amazon’s core objectives are customer satisfaction and lower prices.

Overall, no matter which strategic planning process a business chooses to implement, strategic planning is vital to the success of a company.

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