A Strategic Business Plan is much more than a tool to obtain financing. If you still have all you plans and ideas locked up inside your head… preparing a strategic plan helps you clarify your company’s direction, ensures your key leaders are all “on the same page”, and keeps both management and staff focused on the tasks at hand.
A Strategic Plan is often needed when…
- Starting a new venture, product or service
- Expanding a current organization, product or service
- Buying a new business, product or service
- Turning around a declining business
A Strategic Business Plan is much more than a tool to obtain financing. Basically, strategic planning is a tool for helping organizations set their priorities straight. If you still have all you plans and ideas locked up inside your head… preparing a strategic plan helps you clarify your company’s direction, ensures your key leaders are all “on the same page”, and keeps both management and staff focused on the tasks at hand.
Strategic planning is quite important because it not only defines the path of an organization, it outlines the steps needed to reach its destination and also shows if the steps will really bring about success or not.
There are three key elements of strategic planning. These are questions that every organization needs to ask itself before deciding on what to do.
Where are we now?
This is first and foremost. To know where you want to be, you have to know where you are. An organization needs to understand all about its business including inner controls and operations, where it stands in the face of competition and more. Constant review of the company’s position is a sure way to set off strategic planning.
Where should we be?
This implies where you want your organization to be over a period of time. Once this thought comes up, there is always a motivation for change.
What do we need to get there?
This is about the final element of strategic planning that actually comprises the elements that bring about the change. You think about what you need to stop doing or do in a different way to help your organization get to the point you want it. Things like goals, deadlines, financing structure, diversification, acquisition plans, and more are what should be on the books.
Although the second question “where should we be?” is the most important, it is most active in the first and third.
However, it is important to match your strategic plans and expectations with practical realities.
There are a number of methods strategic planning can be managed. There isn’t a ‘one size fits all.’ However, most of these methods are closely interrelated in terms of;
- Assessment and analysis – this follows adequate procedures for understanding the external and internal environments.
- Strategy formulation – is the process of developing a high-level strategy and then documenting the basic organizational strategic plan.
- Execution – a stage of converting these high-level strategic plans into serious productive actions.
- Evaluation and management – this phase is when and where there are evaluation and modification of employees’ performance, adherence to organizational structure and culture, effective communication, data reporting plus several other strategic planning issues.
What about a ‘strategic business plan?’
With a good business plan, you can obtain financing for your business. Most folks have a business idea but seem to be comfortable with it inside their heads. Maybe because there isn’t enough financing to kick start the process.
However, with a good strategic plan, you’re one step closer to achieving your dreams. You can be able to put your employees in the know and stir everyone’s efforts towards the achievement of the set goal.
When do you really need a strategic plan?
A good strategic plan with a feasible framework is important when…
- You’re beginning a new service or making a new product. Say you’re starting a new project overall.
- Looking to expand an already existing organization or business or product.
- If you want to purchase an already existing business or organization.
- You’re serious about revamping a dying business or product.
With a properly crafted business plan, your business description, management team, financial status, competition, products or services, and risks can be accessed at a glance.
At SmartCPA, we are out to help clients craft a strategic plan for their business and also help with the overall process of strategic planning.
Our Certified Public Accountants are highly trained and place nothing above their careers. This implies that helping our clients achieve proper progress is our priority.
The plan allows you to…
- Identify and describe the target customer profile, features, advantages and benefits of your new venture, product or service.
- Justify that your plans are credible by fully researching the need being filled with your new venture.
- Develop marketing plans including full descriptions of targeted promotional campaigns with implementation timelines. You also get to examine market conditions, the nature of your customers, as well as your competitors, sales potential, and projected results of your promotional campaigns.
- Develop staffing plans including identifying the key players, skills, attitudes and expertise needed to build the venture.
- Develop management plans including full descriptions of management systems and timelines for implementation.
- Develop financial plans including projected startup costs, operating costs, revenue, profits, and break-even analysis for the first 3 to 5 years.
- Projected financial plans allow you to effectively predict upcoming problems, or prevent them. In other words, the perspective gained through your Strategic Business Plan can make a significant contribution to your company’s success, and help you get the funding you require. In fact, most lending institutions and private investors will not even talk to you without a solid financial plan.Identify building and equipment needs including vendors and cost estimates.
- Formulate company milestones including timelines for upcoming products and services in development.
Obviously, a solid strategic business plan is essential to make headway especially if you’re about starting a new venture. In fact, if you do not have a good strategic business plan, investors, lenders, donors, and the likes will not listen to anything else you have to say.
You have to estimate the business needs including the cost of settling vendors, equipment, and others.
Remember: Failing to plan is planning to fail.