Why strategic planning is important for small businesses, and how to approach it

Run a small business? Find out why strategic planning is so important, and the five aspects every strategic plan needs to include. 

It’s all too easy, when you’re running a small business, to focus on the day-to-day management of your company. Or worse, to purchase from quarter to quarter, or campaign to campaign, without any over-arching global strategy.

But without that big picture view, you have no idea whether your day-to-day decisions, or individual campaigns or plans are actually driving your business forward. Or even in the direction you want it to go.

Trethowans

In order to confidently steer a company that is growing in a controlled, targeted and measured way, one that meets its KPIs and delivers compound results, you need strategic planning.

What exactly is strategic planning?

‘Strategic planning’ is simply putting in place a system of procedures and company growth methods over a set time period to achieve designated business goals.

There’s no one-size-fits-all approach to strategic planning, nor is there a set time period for it. Some companies work towards five-year periods, others three years, and some even shorter periods – especially if they operate in a fast-moving industry.

But while your individual approach to strategic planning may differ, there are key aspects to it that remain the same. Here are five important aspects to successful strategic business planning.

1) Your business objective

To start out, you need to be clear about your company mission: why does your business exist, and what do you want it to achieve?

2) Your organisational goals

What goals have you set for your business? These need to be in line with your business mission, but should be much for specific. For example, what turnover or number of customers do you want to achieve, and by when? Ideally, these will be SMART goals.

3) A strategy plan for each goal

Once you have your SMART goals nailed, you need to outline a strategic plan for each. If you’re planning a five-year strategy, you may want to add interim, one-year strategies (or shorter) en-route to your five-year finishing line. It’s also important to add planned checkpoints along the way to ensure your strategy is working, and to allow for any revisions needed.

4) An action plan

A strategy alone isn’t going to get you very far – in order to make progress towards it, you need a step-by-step action plan. This will give you daily, weekly and monthly tasks and mini-goals to hit that, planned properly, will deliver you inevitably to your SMART goals. (You can read how to chunk your SMART goals into step-by-step tasks here.)

5) Monitoring the execution of your strategy plan

Once your plan is in action, it’s important to keep a keen eye on it. Are you keeping to your tasks? Hitting your deadlines? Meeting your SMART goal checkpoint targets? And are your business mission and organisational goals still valid?

By checking in on your strategy regularly, and measuring it against your business as a whole, you can ensure it remains relevant and successful. And if not, you’ll be able to make the necessary adjustments in a timely manner.

Edsmart offers online MBA programs with no GMAT requirements.