There is much confusion, particularly among small business owners and start-ups, about what Strategic Planning is. In fact, in our experience, many clients come to us looking for help on their business plan, only to determine that what they really need is a rethinking of their strategy.
In this article, I will attempt to demystify Strategic Planning and explain why you probably need to think about this for your business.
How is a Strategic Plan different from a Business Plan?
First, let’s briefly talk about the infamous Business Plan. This plan is typically not optional, particularly if you are looking for financing or applying for a loan, grant or subsidy. In these cases, you will always be required to present one. From a high-level perspective, a Business Plan:
- Answers the question of “what business are you in”
- Is required for a new businessor new business venture
- Provides structure to define your business venture and its viability
- Includes operational structure, marketing plan, financial projections, and so on.
A Strategic Plan contains some of the same elements, but is for a completely different purpose! It is NOT a nice-looking document for others to look at, but rather a process to identify the concrete strategies and tactics you will need to reach your goals. A Strategic plan:
- Answers the question of “How will you get there?”
- Is generally about an existing business
- Is for businesses that are serious about growing
- Includes a timeline of specific proactive actions you will need to take
- Helps to prioritize your efforts and spend your time on the less urgent, but still important activities that are necessary to take your business to the next level
| Business Plan | Strategic Plan |
| Answers the question of “what business are you in” | Answers the question of “How will you get there?” |
| Is generally for a new business | Is generally for an existing business |
| It is required to obtain investment/financing | Is often not required by 3rd parties |
| Provides structure to define your venture and its viability | Provides structure to prioritize your proactive efforts required to take a business to another level |
| Results in a document that outlines the business model, financial projections, organizational structure, target market and marketing plan | Results in a specific, time-bound plan of action |
Who needs a strategic plan?
A clear and practical strategy is an essential tool for entrepreneurs and business leaders! Larger corporations usually spend large amounts of money and time to develop their Strategic Plan with off-site retreats and consultants. Since it is often not requested as part of the financing process, entrepreneurs often don’t develop one. It doesn’t need to be this way – there are ways to develop your strategy at a cost of time and money that is more appropriate to smaller businesses.
As an entrepreneur, you can usually relate to some or all the following:
- Being faced with conflicting priorities
- Constantly dealing with day-day emergencies
- Feeling overwhelmed
- Never seeming to get to the important things
- Not knowing which new business ideas and opportunities to explore
- Uncertainty about how to decide what to work on
- Feeling alone with no one to bounce ideas with or challenge your thinking
A Strategic Plan is there to help with all of this. It will provide a roadmap to guide you into the future, rising above day-to-day challenges and emergencies.
A strategy is, by definition, a plan of action designed to achieve a major goal or goals. This means that good Strategic Planning results in a specific, time-bound plan for what you (and your organization) will do proactively in the next 3/6/9/12 months (and beyond) to deliver on your mission and vision, achieve important goals, etc.
IT IS NOT your to-do list of the day-day actions that bombard you as you run your business. In fact, a Strategic Plan should only include those proactive tactics that, without a plan, you would never get to!
A Strategic Plan is not a static document – it should be constantly evolving. The plan should be a guiding light to help with direction, decision-making, prioritization, and provide you with a structured approach on how you intend to move forward.
When should you develop one?
In a constantly changing business environment, re-assessing your objectives, your strategies and your tactics is essential as the situation hanges. Although a Strategic Plan is important to have at all phases of your business, there are moments where a re-assessment of your strategy is a MUST, such as:
- Abrupt Change – The market, economy or world just changed significantly (think Covid-19).
- Disruption – A new technology or competitor threatens your business.
- Stagnation – You have reached a plateau. What you have done has brought you this far, but you need to rethink your plan to take your business to another level.
- Opportunity – You see a new direction or market potential that you want to consider taking advantage of.
How do you develop a Strategic Plan?
It is important to reiterate here that a Strategic Plan is for you, the business leader/entrepreneur and your leadership team. It is NOT for outside parties (although you can share it), but to guide your proactive efforts. This means that the goal of this is NOT a pretty document, but rather a concrete plan that you use to run your business. In this way, the most important part of the process is the brainstorming and honest reflection on your business and where you want to take it.
There are many tools, templates, and models out there to help structure the process of Strategic Planning. However, some of the keys to success in this process are:
- Get Away – Set aside uninterrupted time (preferably off-site away from day-day interruptions).
- Set aside enough time – truly constructive brainstorming means you need to set aside 3-4 hours at a time.
- Reflect honestly on what brought you to where you are, where you want to go.
- Leverage your strengths to develop proactive strategies and tactics you will need to undertake to bring your business to the next level.
- Consider the help of a neutral 3rd party, not intimately involved in your business, to guide the process, challenge some of your assumptions and provide a fresh perspective.
If you know your business needs a Strategic Plan, and needs one now, remember that a good plan is the result of a simple process of thinking through how to hit a target and whether it’s realistic to try. You don’t need endless research or complex modelling, just start by giving yourself space and time to assess where you are and where you’re going.
If you’d like to discover the ways we can help you with this, book a free discovery call with our team today:
