Strategic planning is the process of setting the direction for your business. It involves assessing where you are now and determining where you want to go. In a nutshell, you make a plan, spell out the details, do what you planned, and then measure the results.
There can be many challenges along the way to implementing a strategic plan. According to a global executives survey from Harvard Business Review Analytic Services, only 20% of organizations achieve 80% or more of their strategic targets. The organizations that succeed in implementing their strategies are quick to adapt to unexpected changes in the market. The leaders responsible for implementing the strategic plan believe their organizational structure helped them carry out strategy.
Let’s dive into setting up your startup to succeed in making and implementing its strategic plan.
Quick takeaways:
- Strategic planning depends on the people making and executing the plan
- Set a limited number of achievable strategic goals
- Communication is essential to the success of the strategic plan
Planning Begins with People
A strategic plan begins with determining the stakeholder team to include in your strategic planning process. In addition to company leaders and decision-makers, stakeholders should include key influencers, thought leaders, and future leaders in your organization who can add value. It is important to have different voices in the room.
Identifying Key Stakeholders
Ask these questions to identify key stakeholders:
- Does the stakeholder play a critical role in the success of your business?
- Can you clearly identify the contributions the stakeholder adds to your business?
- Does the stakeholder have an increasingly important role in your business?
- Is the stakeholder someone who can be easily replaced in your business?
- Is the value the stakeholder brings duplicated by another stakeholder at the table?
Use the answers to narrow the pool of stakeholders to those who are critical to the strategic planning process. Do not add people because you like them or find them interesting. This is essential for crafting your company’s direction. Include people who can add important perspectives to the discussion based on their role, responsibilities, and experience. Consider that sensitive materials may be discussed. Discretion and trustworthiness are important traits.
Make the Goals Achievable
Before setting goals, begin the strategic plan with your startup’s mission, vision, and values. Ensure everyone agrees that these statements represent your current culture and direction. Once they are set, you can define the goals for your strategic plan.
Develop goals that are achievable, even if they are a stretch. Setting high goals that are difficult to achieve will only serve to discourage your efforts. Make simple goals that will move your startup forward. Set a maximum of three goals. This will ensure you focus on achieving each goal with your current resources, as well as avoid distractions from trying to achieve too many goals. Each goal should be SMART:
- Specific: Each goal is well-defined and distinctly described
- Measurable: You can quantitatively measure progress toward achieving each goal
- Attainable: Each goal can be realistically accomplished
- Relevant: Accomplishing each goal will get your business closer to your vision
- Time-bound: Each goal has a specific end date
Use the Pareto Principle
You’ve probably heard of the Pareto principle, where 80% of your output (results) comes from 20% of your input (effort). Many successful businesses also find that 80% of their revenue comes from 20% of their customers.
Apply the Pareto principle to goal setting: Spend 80% of your time working “in” your business to keep it operating well, and 20% of your time working “on” your business to reach your goals.
Communication Is Essential
Strategic plans are worthless if they stay within the minds (or computers) of your leadership team. Success depends on engaging team members throughout your organization to give life to the plan. Communication fuels the momentum required to execute the plan.
Transparency is essential to communication. Be clear on your goals, motivations, and requirements. Make the strategic plan document available to everyone in the organization. Reference the strategic plan in internal communications to ensure everyone knows and understands the company’s direction. Sharing the strategic plan with all members of your team will ensure they:
- Understand what tasks they are doing and why
- Buy into and fully participate in the plan
- Contribute to the success of the overall strategy
Communication Precedes Execution
Without execution, a strategic plan is nothing more than words. Build a “say it, do it” culture to ensure that what you communicate (i.e., the strategic plan) gets done. To turn communication into execution:
- Clearly communicate and reinforce your goals and priorities across the company
- Define how things will get done
- Determine who is responsible for what activities and hold them accountable for their actions
- Monitor and track progress, and share the results with everyone
Building Upon the Basics to Create and Implement Your Strategic Plan
It’s crucial to understand the basics of creating and implementing your startup’s strategic plan. You need to put the right people in place to formulate and direct the plan. Limit the goals of your strategic plan to improve your chances of success. Communicate the plan with every member of the team to ensure buy-in throughout the organization.
Do you need help with creating your startup’s strategic plan or moving your plan forward? Sellerant can guide the way.