Why Your Business Needs a Strategic Plan
Updated: Oct 27, 2020
Here are 5 Ways Strategic Planning will Help Your Business
Have you ever tried to get somewhere that you have never been before without a map or directions?
Most us have. And it can be an extremely frustrating experience. Once we finally get to our destination we regret the time and effort that was wasted getting to where we wanted to go because we didn't take the time to plan out our trip before we left. We assumed that we knew how to get there. I mean it can't be that hard right?
After driving around in circles for hours, and asking locals for directions only to get more confused, we are no closer to getting to where we want to go. If only we had taken a little time, and put in a little more effort to plan our trip before we left, we would have saved a bunch of frustration and anxiety.
But this is the strategy, or lack of strategy, that many business owners use when it comes to planning for the future of their business. In my experience, less than half of business owners have a working strategic plan. And of those 50% of owners that have a strategic plan in place, I would estimate that only 50% of them are actively using it, updating it and following it. That means, and again, this is just my experience working with CEO's and business owners, that only 25% of companies are implementing a strategic plan and enjoying the success that comes with it.
However, the majority of business owners and CEO's that I interviewed attributed their companies growth in sales to the creation and implementation of a strategic plan. So why aren't more business owners and CEO's using strategic planning to their advantage?
In an effort to get you motivated to start your strategic planning process today, here are 5 ways that strategic planning will help you and your business:
1. A Strategic Plan is a Road Map for Your Business
Do you like punishing yourself with needless frustration? Do you enjoy wasting time and money? I didn't think so. A Strategic Plan acts like a road map for your business. It also helps you to define a destination. Once you know where you want to take your business, the road map will plot out the best course to take, bring to your attention any potential road blocks and help you choose the best vehicles to get you to your destination as efficiently as possible.
2. A Strategic Plan is a Powerful Communication Tool
Often as business owners and CEO's we carry around our plan in our head. Occasionally we share it with our senior management team, but at best, it likely come across as a grand vision with little detail on how others can participate and help to make the plan a reality. A well-defined and articulated strategic plan that has invited other stakeholders to help create it is a wonderful tool to communicate the vision to all levels of your company.
3. A Strategic Plan Creates Alignment
If there is no common direction set for your company, each employee is left to figure out what the overarching plan for the business is. While their intentions are good, some of their actions will not align with your vision and will work at cross purposes to other departments and business units. With a strategic plan, each employee can refer to the mission, vision and action plan as the foundation to ensure that their actions align with the big picture goals of the business.
4. A Strategic Plan Simplifies Decision Making
The goals for your organization for the year ahead are laid out in your strategic plan. Now that your goals are defined, you can base all of your decisions on whether each decision you make will get the business closer to the end goal or take you further away from achieving your goal. In business, like life, we can encounter many detours or roads that look appealing but don't get us any closer to our final destination. With a strategic plan, you can make sure that both large and small decisions keep you on the straightest path to your final destination.
5. A Strategic Plan Sets Goals
In business, having clear goals matter. Without clearly defined goals, your business will drift along, often at the mercy of factors you could have controlled or mitigated if you had a plan. You will find that your business will get 'somewhere' but it's really just another kind of 'nowhere.' With defined goals, your entire organization will have a clear sense of direction, clarity and focus. You will waste less time on the things that don't matter, and focus more energy on the things that do matter.
So there is your quick list of 5 ways that a strategic plan will help your business. Strategic planning is an effective business growth strategy. If you are serious about growing and improving your business, start with a strategic plan.