Do I need a strategic plan?

September 1, 2020

Business advisors, like me, often tell you that you need a Strategic Plan. Creating one for your business is honestly a lot of effort, so do all businesses really need a Strategic Plan?

The answer is this: If you’re really ambitious for your business, you do need a strategic plan. It doesn’t need to be 50 pages of detailed business speak, nor does it need to have pretty formatting or professional branding, but you do need a plan and it is best to write it down.

So what is a strategic plan?

A strategic plan is road map that sets out what you want to achieve by a certain point it time. It describes how you’re going to get there, and it covers how you will ensure you’re on course to get there.

 

 

What you want to achieve – Your Goals

 

To work out specifically what you want to need to do, you need to spend a little time thinking ahead. First, identify a broad goal that might be more personal than business orientated. Examples might be any of the following:

  • I want to be financially independent
  • I want to spend more time with my family
  • I want to leave a legacy
  • I want to disrupt the industry I work in
  • I want earn a reasonable living without too much stress

To give some context here’s mine:

I’d like to be financially independent in 10 years. This is so that I’m protected from any possible financial shock. I’d then like to create something that will live on when I’m not here anymore.

 

From this broad goal, you can then work out what the overall specific goal is – in my case, a certain amount of accumulated wealth will allow me to achieve that.

 

How you’re going to get there – The Detailed Plan

 

You now have to work out what needs to happen for you to achieve these goals. No need to go ridiculously in-depth, but think about these sort of questions:

 

  • What profitability is required to generate enough funds to build the wealth I need?
  • What systems do I need in place for the business to run well without me?
  • What does my business look like in order to be attractive to an investor or purchaser?

 

From this you can establish what actions you need to take to achieve these goals. These form a logical path back from the high level goal. These could be:

 

  • I need X new clients per year at this average fee level. I convert Y% of prospects, so I need Z leads. Now I need to carry out certain tasks to generate those leads!
  • There’s a task I do that takes up an awful lot of my time. It needs to be done by someone other than me, so I need to recruit!
  • Our terms and conditions need to be robust, we’ve had issues with them already, looks like I need to engage a lawyer!

 

What you’re looking for a list of simple actions. If you achieve these actions, they will give you results you want.

 

 

How to make sure you’re on course – Measurement

 

Each of the actions above must be set in a way that can be measured. You must be able to review them regularly. These will be your target KPI’s [Key Performance Indicators]. Assuming you’ve asked the right questions, meeting these KPI’s will achieve your goals.

If you don’t succeed it’s because of only two reasons. Either you’re not meeting your KPI’s,  or you were wrong about whether they would work. At that point, you have a the opportunity to sit and decide what to do. Either try harder to meet the KPI’s or reflect and re-plan.

All of this can be done on one piece of paper. I personally started my plan on a few post it notes! I’ve converted it into a formal plan now so that I can share it. But if I was just starting out and had no team – the few bit of yellow paper would have been enough for the first year or so!

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