Strategic Planning Starter Guide
A go-to reference for small to medium businesses on how to create and implement an effective and robust strategic plan.
This guide includes simple steps for a successful plan, and a strategic plan template example.
Successful businesses know strategy and planning are key to reaching operational goals.
What is a strategic plan, why are they important for SMEs and what are the steps involved? In this article we explain:
- What is a strategic plan?
- Scenario planning
- The strategic planning process - 5 key steps
- Measures and metrics to consider in a strategic plan
Best practice strategic planning is a highly valuable process, regardless whether your business is performing well or you are exiting the market – setting a clear direction, remaining true to your goals and re-assessing your plan will provide the best chance of success.
There are many examples of businesses founded on a great idea, which ultimately flounder when they lose sight of their goals, or are unable to effectively manage rapid growth. A strategic plan is your best defence against this scenario.
A strategic plan is a well-informed, holistic roadmap for your business, providing a framework and accountability for your goals.
It’s a constant guide for your daily, weekly, monthly and annual decision making – consider it the ‘true north’ reference point for your business. While flexibility in execution may be required, your plan’s overall objectives should remain your touchstone.
A strategic plan keeps you and your team focused, providing a solid vision and certainty, enabling consistency in messaging and giving confidence to the business and stakeholders.
Before and during the strategic planning process, you should consider the various ‘what ifs’ – the scenarios or disruptions that could be on the horizon, and how you might adapt.
While you can’t predict the future, you should have contingencies in place that allow you to make decisions and resource effectively when things don’t go to plan. Where uncertainty exists, confidence is invaluable - planning for unexpected outcomes will give you that confidence and can help prevent significant financial impacts.
Scenarios you plan for will depend on your industry and business, but examples might include:
- Retirement or resignation of key people in your business
- Loss of major export market
- Collapse of a key client or supplier
- Your own illness or incapacitation
- Sudden and dramatic increase in demand for goods or services.
The pandemic is an obvious example of an unexpected scenario. When the widespread impact of COVID became apparent, those businesses that factored scenario planning into their strategic planning process were better able to adapt.
Want more best practice insights for SMEs? Our expert advisers have compiled nine articles covering the most important processes for successful SMEs. Read more.
A best practice strategic planning process for SMEs has five key steps:
1. Data and information collation
Before embarking on any planning or implementation, take the time to gather comprehensive information about the current state of your business and your market.
Ensure you collect and carefully listen to the views of your key people and stakeholders – How do they envision the future of the business? What opportunities do they see? What are their career plans and those of the people under them? Consider how these align to your own knowledge, perceptions, views and goals.
Take the time to research your market and understand how you are positioned within it. Data from within and outside your business can help identify opportunities and may even challenge some of your preconceptions, resulting in a better outcome.
2. Formulate your plan
Using the information gathered at step one, it’s time to put your ideas and goals on the table and layout your roadmap to achieving them. Set aside a day or two of planning workshops with your team, or hold several shorter, more focussed discussions over a longer period of time.
Whatever your approach, it is critical you attach financial figures to each of the agreed goals or outcomes, as a plan you can’t afford to execute will very quickly fail.
At this stage of planning, outside help or guidance, such as an advisory board, can make all the difference. They will ensure all views are heard and factored in, provide additional expertise and a network of contacts that may be useful to your business.
Once your plan is mapped out, the implementation phase can begin. For each action and outcome established in your plan, assign a team member to be responsible for its implementation and allocate a budget.
This gives key people in the business a clear understanding of who is responsible for what, how they should go about it, what resources they have available and how it fits in the overall vision for the business. It also provides the basis for keeping the business accountable to the goals you have identified.
This is arguably the most important aspect of any strategic plan, and transforms the process from a once-off occurrence to an ongoing system. Consult your plan regularly to ensure you’re on track and remain focused on the objectives, your people are fulfilling their responsibilities and you remain on budget.
If actions aren’t being delivered, or there are some taken which don’t align to the plan, hold yourself and your team accountable. If you feel you don’t have the skills or capacity to do this, call on that outside adviser and their network for input.
5. Review and refine
Circumstances change and so do plans. Your strategic plan should never be set in concrete – it is an adaptive, constant process used to steer your business towards the outcomes you’ve identified. Reviewing and refining your plan is an integrated part of the process to ensure objectives or steps which are no longer relevant are amended, removed or replaced.
If the market changes, or you’ve achieved a goal earlier than expected, go back to your plan and amend it to reflect the change. Perhaps you can include a new, more ambitious goal or refine the actions required to meet an outcome – whatever the case, approach this step with an open mind and consider it an opportunity to maximise the success of the plan.
Need help? We have local teams across Australia ready to assist, contact us today.
Measures and metrics certainly have an important place in strategic planning, but they shouldn’t overwhelm the process. They are particularly useful in ensuring accountability, and can be used to identify and measure performance indicators and track progress. Defined measures allow you to identify what you are doing well, or not so well.
Best practice strategic plans don't have too many measures. Rather, the business identifies key metrics – perhaps five or six – that are best aligned to the strategic outcomes and then use them to keep on track.
The measures you include may be financial, employee-related or otherwise, depending on your industry and specific goals.
Businesses that demonstrate best practice in this area take a holistic approach to management and operational reporting. Their reporting is aligned and refined – not done for the sake of it. An example of this approach is a regular ‘heads up report’- a summary of key indicators for each section of the business. This might be operations, people, marketing, finance, or IT – depending on your industry and size of business. Budgeting and forecasting, the next topic in our series, has a vital role to play here.
Strategic Planning Starter Guide
Now that you know how important a strategic plan is for a successful and long-running business, download our Strategic Planning Starter Guide to get started.
Created as a go-to reference for small to medium businesses on how to create and implement an effective and robust strategic plan, this guide includes simple steps for a successful plan, and a strategic plan template example.