Strategic Planning: What is it?
Organizations must immediately adapt as the state of business is changing more quickly than ever. Without a clear strategy in place, it's simple to get sidetracked in the midst of the commotion.
An approach to long-term strategic management called strategic planning divides a company's vision into quantifiable, trackable milestones. Each of these goals has a due date, and it is shared with the entire business so that everyone can work together to achieve them.
Strategic Planning Process
The best strategic plan examples follow three steps.
First, formulate the intended strategy. Decide where you want to be months or years from now, what that looks like, and how to get there. Perform audits and analyses inside and out to determine strengths, weaknesses, and obstacles. Some threats can't be predicted, but preparation is still valuable.
Decide which existing plans and lines of business need improvement or to be removed, how to shift and apply existing resources and funding, whether any staff training or reallocation is required, and so on.
Each of these changes must be measurable. Platitudes will accomplish nothing — results should be quantifiable in terms of timeline, earnings, staffing, or hours of availability.
Next is implementation. Once a business knows which steps it has to take and how to take them, it can allocate resources to make them happen. A plan from start to finish makes it easy to stick to goals and ensure work gets done on time.
In this stage of strategic management, communication is critical. Upper management must communicate with subordinate departments about what changes are being made — and why — to give every level a better vision of organization-wide goals.
This approach also aligns business actions with business goals. When focusing on expansion in one region, there is no reason to continue full-steam-ahead marketing efforts in another region. A marketing department that understands your sales goals will shift focus because they want to help grow the business, not because they're told to.
The third step is self-reflection. Objectivity matters after implementing a strategic plan as much as it does when you first start. After your plan’s objectives succeed or fail — which is easy to determine because they have explicit goals — examine the factors that caused your results.
This review process also helps future strategic plans. If your business created a new internal reporting system, it might need to implement an automated reporting dashboard for management.
Advantages and Benefits
Proactivity lies at the core of the strategic planning definition, and is ultimately its most important aspect. Reactive plans that only fix short-term problems just can’t keep a modern company afloat for long.
Instead, strategic planning focuses on long-term growth and sustainability. It allows you to set big-picture goals and carve out a specific sphere of influence and a unique brand identity that does more than ape the competition.
It's important to build your strategic plan holistically, considering the goals of each department and level in your organization. If done correctly, you'll avoid the friction caused by imprecise rollouts, including last-minute changes that make communication between departments fragmented and hostile.
This approach helps workers feel valued and kept "in the loop" on company direction and the reasons behind it. Employees who clearly understand their company's strategic vision are not only more productive, but they're able to work with everyone else toward shared goals.
Finally, well-laid plans with explicit goals help measure the company's overall health and ability to perform. Numbers don't lie, and data-driven KPIs convey performance better than instinct ever could.
Strategic Plan Example
When designing a strategic plan, it often helps to ask a broad question. For example:
Q: How can we improve SaaS revenue?
"Improve" isn’t very specific, but at this stage we’re looking for a vision. It represents the general direction of a goal. Next, narrow it down to a clear, measurable goal with a deadline:
Q: What does improving my SaaS revenue look like?
A: Increase gross earnings by 10% by the end of Q4.
Notice how the answer has three essential parts.
- A clear goal: increase gross earnings
- A measurable metric: 10% increase
- A deadline: the end of the fourth quarter
Now, the question becomes how to make that happen. It could involve efforts to improve contract renewal or an aggressive marketing campaign and the allocation of resources to make it happen. New training for a service team, discounts for long-term customers, or a contract with a new marketing firm are all possibilities based on the most achievable objectives.
Regularly measuring your progress towards your goals makes it easy to see how well each task is going and the likelihood of meeting deadlines.
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