How to Write a Strategic Plan
Running a successful business is no small feat. It requires a clear vision, a well-defined roadmap, and the ability to adapt to a rapidly changing landscape. That’s where a strategic plan comes in. It serves as a compass, guiding organizations toward their goals and helping them navigate the complexities of the business world.
However, for those embarking on the journey of creating a strategic plan for the first time, it can be a daunting task. The sheer magnitude of the process can leave even the most seasoned entrepreneurs feeling overwhelmed. But fear not, because in this article, we will explore how writing a strategic plan can be a transformative and valuable exercise for businesses of all sizes. Let’s dive in and discover the power of strategic planning.
What Is a Strategic Plan?
A strategic plan is the roadmap that guides an organization towards its long-term objectives and helps it navigate the ever-changing business landscape. It serves as a comprehensive blueprint, outlining where the organization is, defining where it’s going, and detailing how it’s going to get there. In short, it is defined as “where we’re going to play, and how we’re going to win.”
Components of a Strategic Plan
When it comes to strategic planning, every organization has its unique journey and specific areas of focus. As someone who embraces the StratOp framework as a preferred approach, I believe that a good strategic planning framework should encompass various components that drive organizational success:
- Perspective: Before diving headfirst into planning, it’s essential to pause and gain proper perspective. This involves taking a step back, assessing the current state of the organization, and getting clarity on this question: “Where do we currently stand?”
- Planning: The planning component is at the core of strategic planning. It definitively answers the question, “Where are we headed?” This involves setting clear goals and defining the strategies necessary to achieve them. Effective planning requires a balance between long-term aspirations and short-term actionable steps.
- Action: Identifying “what’s important now” is a vital aspect of strategic planning. It involves prioritizing initiatives, projects, and actions that align with the organization’s long-term strategic objectives. By focusing on what’s most crucial in the present moment, you can allocate resources effectively and ensure that efforts are directed towards the areas that will have the greatest impact on the organization’s success.
- Structure: Once the “function” (a plan) is defined, you need the “form” (structure) to execute and implement. A clear structure of people, processes, and systems for implementing your strategic plan is essential. The right structure provides a framework for decision-making, resource allocation, and performance tracking. It ensures that everyone in the organization understands their roles and responsibilities in executing the plan.
- Management: Managing the strategic plan over time is crucial for its success. This component involves monitoring progress, tracking key performance indicators (KPIs), and making necessary adjustments along the way. Regular (quarterly) review and evaluation of the plan’s effectiveness help to ensure its relevance and adaptability.
- Renewal: Recognizing that the business landscape is ever-evolving, renewal (an annual event) allows organizations to reassess their strategies, pivot when needed, and realign their goals with the changing environment. It encourages continuous improvement and ensures that the strategic plan remains agile and relevant in the face of new challenges and opportunities.
What to Do Before Writing a Strategic Plan
Choose a Strategic Planning Framework
When it comes to strategic planning, there’s no need to reinvent the wheel. Why spend precious time and resources trying to create a plan from scratch when existing frameworks can provide you with the focus and boundaries needed for an effective strategic planning process? By utilizing an existing framework, you tap into the collective wisdom and experience of those who have navigated the strategic planning process before you. I use the StratOp framework with my clients, but there are several other systems that prove effective, such as EOS® and the One-Page Strategic Plan.
Review a Strategic Plan Example
As I said, I use the StratOp framework for strategic planning. Here’s a strategic plan example using StratOp.
Hold a Strategic Planning Meeting
Strategic plans are not created in isolation; they require the input of key individuals across the entire organization to gain an accurate understanding of its current state, direction, and desired future. In my experience, I have found that involving a cross-function group of “development-minded” people in the strategic planning process yields valuable insights and creates a sense of ownership throughout the organization.
The StratOp method provides a structured process for these planning meetings, ensuring that we cover essential elements and address key strategic questions. Starting with perspective, through facilitated discussions and exercises, we explore industry trends, customer needs, competitive landscape, and internal strengths and weaknesses. This process helps us develop a shared understanding of our business context and identify critical areas for improvement and growth.
Next, we move into the planning phase. Drawing on the insights gained during the perspective phase, we set clear goals and objectives. These goals are aligned with our long-term vision and mission, and they are designed to move us closer to our desired future state.
Then we move on to identifying what’s important now (WIN). During our planning meetings, we prioritize initiatives and actions based on their urgency and potential impact. These conversations happen once a quarter.
Throughout the planning meetings, we emphasize the importance of open and honest communication. We create a safe space for individuals to share their thoughts, concerns, and ideas. This fosters a culture of collaboration and encourages active participation from all attendees. Our annual planning meetings, conducted using the StratOp method, allow us to tap into the collective wisdom of our team and create a strategic plan that is comprehensive, realistic, and actionable.
How to Write a Strategic Plan in 5 Steps
1. Reflect the Current State of the Business
A good strategic plan begins by explaining the perspective gained during the planning process. We use tools such as the Four Helpful Lists, which prompts companies to identify what is working well, what needs improvement, what is changing in the external environment, and what potential risks lie ahead. In addition to the Four Helpful Lists, another effective tool for gaining perspective is the Patterns/Trends analysis. This involves examining industry trends and market dynamics to identify patterns and emerging trends, allowing an organization to identify any implications for the future.
2. Create Your Mission and Vision Statements
A company’s mission is what it does every day. It answers the question “Why do we exist?” A vision is a future-oriented picture of the ideal, target state. Both are necessary so that a team can know where it’s headed.
3. Set Goals & Objectives
Identifying clear business goals and priorities is the next step in the strategic planning process. These goals provide a sense of direction and purpose, ensuring that all efforts and resources are aligned toward achieving the desired outcomes.
Whether it’s a one-year, three-year, or five-year timeline, goals act as a filter for evaluating different options and opportunities. For instance, when making budgeting decisions, having well-defined goals enables businesses to allocate resources strategically. This helps prevent scattered efforts and ensures that resources are directed towards the most critical areas.
4. Determine Action Steps
The next part of your strategic plan should focus on outlining the tactical, short-term steps that are necessary to execute your long-term goals and objectives. To ensure the effectiveness of these tactical steps, it is crucial to make them actionable. Each step should be specific and clearly defined, leaving no room for ambiguity or misinterpretation.
Assigning each tactical step to a specific person is another critical aspect of the planning process. By assigning responsibilities to individuals within the organization, accountability is established, and progress can be tracked more effectively.
Furthermore, assigning a clear due date to each tactical step is essential for maintaining momentum and achieving timely results. Deadlines provide a sense of urgency and help prioritize tasks within the overall plan.
5. Leave Room for Progress & Completion
A strategic planning document should never be treated as a rigid and unchanging artifact. Instead, it should be viewed as a living resource that evolves and adapts along with the business. The purpose of strategic planning is not merely to create a plan and then file it away, but rather to use it as a dynamic tool for guiding decision-making and progress. Regularly reviewing the plan, checking in on progress, and making adjustments when necessary are essential for its effectiveness.
One valuable practice is to incorporate ongoing check-in notes directly into the strategic document itself. This allows for real-time reflections on the progress made and challenges faced during the implementation of the plan. It’s also vital to allocate time for periodic reviews of the strategic plan to ensure its relevance and alignment with the ever-changing business landscape.
Lastly, leaving space in the strategic document to reflect on the completion of the plan is crucial. This reflection allows businesses to celebrate milestones and achievements, acknowledge lessons learned, and identify opportunities for growth and improvement.
Tips for Developing a Strategic Plan
Be Honest About Your Business
If you’re not going to be honest about the current state of your business, then don’t plan. In his book Necessary Endings, Henry Cloud says that, when presented with the truth, “A fool will adjust the truth so they don’t have to adjust to the truth.” Don’t be a fool.
Share the Vision
Strategic planning discussions should not be limited to the confines of the C-suite; they should be cascaded throughout the entire team. Sharing the outcomes of strategic planning meetings in a way that is relevant and applicable to each team member fosters a sense of ownership and encourages buy-in. By translating strategic goals into actionable tasks and demonstrating how they align with individual roles, teams can work cohesively towards a shared vision, driving greater engagement and overall success.
Understand Your Key Performance Indicators (KPIs)
Successfully executing a strategic plan is characterized by measurable progress towards achieving the identified goals and objectives. Key performance indicators (KPIs) play a vital role in tracking and assessing this progress. Identify the KPIs, monitor them, report on them, and when execution is off track, implement corrective action. It really is that simple.
Methods like EOS® and StratOp emphasize the importance of regular meetings and checkpoints to ensure effective execution of the strategic plan. These structured meetings provide a framework for accountability, progress tracking, and driving results.
Don’t Be Afraid to Change Course
A good strategic plan provides a solid framework that guides decision-making and actions, yet it remains flexible enough to adapt to changing circumstances. Recognizing that company goals and industry realities can shift, a strategic plan should allow for the necessary agility and responsiveness.
Questions About Writing a Strategic Plan?
Whether it’s evaluating the effectiveness of your strategic framework, streamlining your planning meetings, or enhancing the execution of your strategic initiatives, I am here to support you. Contact me to set up a no-obligation, 30-minute session to discuss your strategic planning process.