Spearheading growth with strategic business planning
In the first of a series of blogs on how you can get your business growing in 2011, Stephen Gregson explains how the planning process works.
A strategic plan is not an end in itself, but rather a route map that enables businesses to develop in line with their long term goals. This mantra is evident in the following historic quotes:
In preparing for battle I have always found that plans are useless, but planning is indispensable – General Dwight D Eisenhower.
A good plan today is better than a perfect plan tomorrow – General George Patton.
This article isn’t about American military leaders in the Second World War, or about anything American, military or historical for that matter. It is about the importance of strategic plans, which are crucial for any successful organisation, including businesses.
Understandably, when we see the term ‘strategic plan’ we sometimes have a sense of why bother? After all, plans are little more than crystal ball-gazing, often masquerading as something more scientific. And they can take up lots of valuable management time which would be much better spent focusing on more immediate concerns.
And yet, strategic plans are often held up as a self-evident ‘good thing’ for a business to have. Why? Well, I think the answer lies in Eisenhower’s statement. The real value of a strategic plan often comes not from the end product, the plan itself, but rather from the process of preparing it.
To draft a comprehensive strategic plan takes time, but the vast bulk of that time is usually spent on thinking and reflecting. It is running mental ‘what ifs’, or sensitivities as they are called when these ‘what ifs’ are put in a context of financial projections.
The deep thinking required for strategic planning involves different strands of thought:
• Analytical – to understand the current position of the business and its market.
• Creative – to imagine how that market may evolve and/or new markets emerge.
• Critical – to test and probe the assumptions you adopt and conclusions you reach.
And so we come to Patton’s quote. This reminds us that a strategic plan, no matter how well thought out and crafted, is ultimately imperfect. Completing a complex plan and associated projections is not the end point. It is rather the start of the real process of working to achieve the strategic goals.
The plan does not need to be perfect, it can’t be. It simply has to be good enough. A useful measure of the strength of the plan is how it is used by management once it is complete. A plan should be a ‘live’ document containing milestones so it can be used as a guide to monitor future performance and progress towards, or deviation from, long term goals.
It is this ability of a plan to make clear the long-term goals that enables management to assess on a day-to-day basis what constitutes a challenge, opportunity or threat and hence, to better determine what the most appropriate course of action is to deal with, exploit or avoid it.