A strategic plan focuses on building a sustainable competitive advantage and is futuristic in nature. Generally, it's headed by the president of the company, who gets input from employees or a specific team. If you were only planning for the day-to-day operations of your company and not what is occurring in your market, what would happen? In fact, research has shown that 70% of organizations that have a formal execution process out-perform their peers. Remember that successful execution of your plan relies on appointing a strategy director, training your team to use OnStrategy or any other planning tool , effectively driving accountability, and gaining organizational commitment to the process. Whatever your situation, just be prepared to let go and switch strategies as necessary. The team is also involved in the formulation of the strategic direction and action plans.
Phase 3: Strategic Plan Development Want More? The business plan is a statement about your business that demonstrates to outsiders what your business is all about; unlike the strategic plan, which is a roadmap for insiders. The two plans cover different timeframes as well. You want to set goals that convert the strategic objectives into specific performance targets. A strategic plan is used to provide focus, direction and action in order to move the organization from where they are now to where they want to go. Strategic Business Planning Strategic business planning is the planning done by top managers to guide the progress of an organization as a whole. The figure shows distinctions I am making.
Unfortunately, the terms strategic planning and business planning have multiple meanings. It is flexible in choice of its means of achieving the desired end state. Threats refer to external conditions or barriers that may prevent a company from reaching its objectives. These plans acknowledge history but are always looking into the future. The business plan is the first thing that your audience will want to see if they are asked to invest in your company or vest their interest in it in some other way.
Once agreed upon, this topic should be developed to conclusion. Over the life of your strategic plan, you may discover that some of the underlying assumptions of your strategy are flawed or incomplete. Therefore, it usually contains pro-forma balance sheet, income statement, and cash flow statement. Phase 1: Determine Your Strategic Position Want More? Step 2: Conduct an Environmental Scan Conducting an environmental scan will help you understand your operating environment. Long-range planning with the present and sets out steps to meet estimated future needs. While a strategic plan is a type of business plan, there are several important distinctions between the two types that are worth noting.
What do you want to capitalize on? Holding meetings helps focus your goals on accomplishing top priorities and accelerating growth of the organization. In other words, a business plan is much more of an aspirational document, covering what your business is about and why it has value in the market. When the business plan clearly expresses the corporate strategy, the process of preparing it may be 'strategic'. From this analysis, you can determine the priority issues—those issues so significant to the overall well-being of the enterprise that they require the full and immediate attention of the entire management team. The plan allows a company to know as much as possible about the needs of its customers and gaps in the marketplace that need to be filled.
Whereas a business plan could be for new businesses and entrepreneurs who are startups. Commonly, a company's leadership assembles once a year to discuss their past successes and their future goals. Deep Dive Into the How-To Guide. A strategic plan is the road map for this journey, highlighting what is coming down the road next and suggesting routes for getting to your goal. What are we best at? Step 2: Define Long-Term Strategic Objectives Long-Term Strategic Objectives are long-term, broad, continuous statements that holistically address all areas of your organization. Think of it this way: success in business is an on-going journey. Characteristics A strategic business plan includes extensive market research, industry trends and competitor analyses.
Moving from big ideas to action happens when strategy is translated from the organizational level to the individual. Marketing, due in 12 months 1. This is achieved by carefully analyzing a particular business industry and being honest about your company's strength and weakness in meeting the needs of the industry. Outcome: A short, concise, concrete statement that clearly defines the scope of the organization. But it is important that key team members report on their progress toward the goals they are responsible for — including reporting on metrics in the scorecard they have been assigned. Whereas a business plan is critical if the business is seeking funding. Outcome: Short list of 5-7 core values.
Define what you must achieve. To convince the prospective finance providers that the seekers know what they are doing, they go into a lot of detail. Strategic planning is different from business planning If you must use the phrase strategic business planning, I urge you do it with a clear definition of strategic planning in mind. In general, a strategic plan is a broadly defined plan aimed at creating a desired future. Outcome: 5-7 measures that help you keep the pulse on your performance. Scheduling the strategic planning process depends largely on the nature and needs of your organization.
While there may be some overlap between strategic planning and business planning, they are not the same thing. Benefits Writing a strategic business plan has many advantages. It's not a business plan Don't confuse a strategic plan with a , which is a much broader document and includes a strategic plan, a , a financial plan and an operational plan. The plan can serve as an outline for successful completion of company milestones. It can help you take your small business to places you never thought possible. However, as the details become finer grained, the confidence we can put in the figures starts to fall. Organization-wide goals are annual statements that are specific, measurable, attainable, responsible and time bound.