Business Strategy: The Framework for Your Plan
We’ve clarified and documented our vision. We’ve based our mission on the business we’ll conduct in pursuit of our vision. We’ve assessed our business to determine how close we are to the definition of business fitness. Business fitness is an encompassing measure of dynamic stability, so it’s one we’ll definitely want to consider as we develop our thinking for the future.
Since all these concepts: vision, mission and fitness are abstract, our next steps should be actions directed toward manifestation. In most instances it will take several years for us to realize our vision. It’s very helpful to define what our business will look like when we reach that level. This definition might include revenues, profits, market share, business scope and product portfolio. What’s important is that we create a mental image of this business and our role within it when the vision has been reached. As such, our longest term goal is to realize, materially, what we have envisioned mentally. We could be talking 3 years, 5 years or more. It’s hard to know how long it will take. We just need to use our best judgment.
If this sounds like a meaningless exercise, think again. Thought is the first step in the manifestation process. Anything created consciously by a human is based on a specific and clear thought. An artist must see the completed painting in his mind, an architect must see the building, an engineer must see the machine and envision its working parts.
Once you have a clear picture, write it out as your long-term goal and be sure to create a benchmark to acknowledge goal achievement. You’re saying “when ‘this’ occurs I will have reached my goal.” Of course, you’ll be moving your goals ahead over time, so it won’t be an end, just a benchmark to acknowledge that you’ve reached your goal.
Now, the question becomes, HOW do you get from where you are to where you want to be? This is where we enter the realm of strategy. Think of strategy as being the system you’ll use to frame your plan. In military strategy, it’s about movement of resources and use of intelligence. In business it’s pretty much the same.
I have a client whose long-term goal is to sell his business so he can retire to a different lifestyle and use the income stream from the sale to partially support his new lifestyle. One of his short-term goals is to maximize the value of the business prior to sale. So he needs two strategies: one to maximize the value, the other to sell the business. They will have different timeframes, but there is an overlap.
His strategy to maximize the business value is to identify and set a plan to increase high-margin clients while reducing low-margin clients. His benchmark is a specific new high in revenue for fiscal 2013. How he plans to achieve that will be addressed in his plan.
His strategy to sell his business is to transfer stock over time to his senior associate, whom he will groom to move into the role of CEO. She’s already handling most of day-to-day operations. The plan will need to include specific actions that he and his associate must carry out with timeframes for each.
The strategies that you select to reach your goals will have a strong influence on the outcomes you will realize. In determining your strategies it can be helpful to call upon the knowledge of others who know you and your business. These can be your business associates (including strategic alliances), your coach and even your customers. And don’t overlook the value in gathering information from your front-line staff and supervisors. They have a wealth of knowledge that often gets overlooked and strategic planning is where it can be particularly beneficial.
Because vision is realized over several years of business operation, you’ll be setting annual goals and selecting specific strategies to help you achieve them. It’s the achievement of these annual (short-term) goals using strategy and planning that lead you, one step at a time, to realizing your long term goals and vision.
Next step? You guessed it – planning. Stay with us. We’ll pick up on that next time.