Strategic Planning in 10 Steps
Everyone knows the saying “Failing to plan is planning to fail.” 2017 is almost over and it’s time to take a look at where we are in achieving our goals. Are we still on the right track? What do we need in order to strategize the best next steps for 2018? Here’s a simplified 10-step strategic planning approach for start-up entrepreneurs.
1. Review your vision.
Visualize your company’s successful future state and clearly describe the details of your future — how will you be perceived by the industry, your customers, and your employees? What kind of impact will you bring? How big will you be in terms of manpower, capitalization, and resources? What will you be known for?
Are you still aligned with how you envisioned the company to be when you started the business? Did it change? Don’t fret. It’s ok to recalibrate your vision yearly.
Set a timeline for achieving your goals. Do you see it happening in 5 or 10 years? What have you achieved so far?
Now, take a look at the coming year and think of sprint goals to move you closer to your vision. What part of your vision do you want to achieve in 2018?
For our company, Vitalstrats Creative Solutions (VCS), our vision is to be the top of mind and the best marketing and digital content production agency in Quezon City in the next five years. We have set specific metrics of what to achieve for 2018 through our five bold steps which I will discuss in item number 4.
2. Review your purpose.
Your business has to have a reason why it exists. It definitely exists for your target customers or for the “people you serve.” What unique value do you give to them? What big problems do you solve?
Steve Jobs said — “We’re here to put a dent in the universe. Otherwise, why else even be here?” As an entrepreneur, always ask yourself — what will happen to the world when you’re gone?
Take the time to reflect. Are you still passionate about your purpose? Is it enough reason for you to wake up and get you fired up every day? Or has it lost its meaning?
Are you still going in the same direction or are you setting a new course?
In Vitalstrats (VCS), our purpose is to enable growth through strategic creativity. We enable growth for our clients, for our team, and for the individuals that make up our team.
As entrepreneurs, what fulfills me and my partner is the impact that we are able to give because of our business. Knowing that the company that we created provides growth to other businesses, contributes to nation building and the industry, and at the same time enriches and provides value to our team, as well as our lives as individuals, is a strong motivation for us to keep improving. It is where we draw our strength in battling our daily challenges.
3. Review your company’s core values.
Your company’s core values are the essence of your company’s identity — your principles, beliefs, and philosophies. It is also a reflection of what you value as an entrepreneur.
Your team is composed of different individuals, with diverse strengths, attitudes, and ways of working. They come from different backgrounds. You need to establish something that would bind you together. Your core values are a set of guiding principles that create a common direction for daily decision making. It is what builds your company culture and is a basis of how everyone in your team should act and behave. It’s a collective statement about what you live by and stand for.
In VCS, our core values are as follows:
C — Commitment
R — Respect
E — Excellence
A — Adaptability
T — Teamwork
I — Integrity
V — Vision
I — Innovation
T — Tenacity
Y — Youthfulness
I will explain the details of our core values in another blog post :)
Everybody in your team needs to be aligned. If someone in your team does not believe in what the company stands for, then there would be conflicts coming your way.
So now that you already have a set of core values, there’s one important thing that you need to consider — are they are aligned with your vision and purpose?
4. REVIEW YOUR OBJECTIVES
Your Vision-Mission should be broken down into measurable objectives that would determine your company’s key success factors. What are the specific steps you need to take in order to reach your goals? What exactly needs to be accomplished this year?
5. SWOT ANALYSIS
Once you’ve finalized your objectives, it’s already clear “where you want to go.” Before coming up with strategies to achieve your goals or “how to get there“, you need to first assess “where you are” through the SWOT analysis. The SWOT will be the basis of your strategic direction.
When you go to the doctor and have yourself checked, the doctor gives you a diagnosis, prescribes medicines you should take, and gives you advice on changes in lifestyle to get back in shape. This can be equated to your strategic direction to achieve your business goals. Doctors don’t just give diagnosis or advice out of gut feelings or opinions. They rely on your lab test results. They get the data and analyze. The data serves as the basis for his insights and directions.
Your SWOT or your strengths, weaknesses, opportunities, and threats should be based on data and facts. There should be evidence and should not be culled from baseless opinions.
Your strengths and weaknesses are internal factors that you have control of. Everything that’s happening in your organization that has a quantifiable basis— your sales figures, profitability reports, employee engagement score, attrition rate, your marketing expense ratio on revenue, the number of systems and processes developed, etc.
The opportunities and threats are from the external factors that you have no control of. This should consist of political, economic, social, technological, environmental factors that affect your enterprise. It’s best to look at your competitive landscape, the digital disruption trends, the future of work, government laws and policies, consumer buying trends and everything else that affects your company. In VCS, we gather data from continuous learning and research by attending industry events, talks, looking at global experts in the same field, and consistently being up to date with trends and what’s happening in the industry.
Strengths — Based on data and in relation to your goals, what are your top strengths?
Weaknesses — Based on data and in relation to your goals, what are your top weaknesses?
Opportunities — Based on the external factors, what opportunities are there for your enterprise?
Threats — Based on the external factors, what are the threats that you should be cautious of?
6. STRATEGIC OPTIONS (WHERE TO PLAY and HOW TO WIN)
Based on your SWOT data, it’s time to determine the strategies that you should execute to achieve your goals for 2018. We use the TOWS framework for easier brainstorming and extraction of our strategic options. You can read more about the TOWS matrix here.
Here’s a quick guide on how to extract your strategic options from your SWOT analysis:
What strengths should we leverage on to take advantage of opportunities?What strengths should we leverage on to counter threats?
What weaknesses should we fix to take advantage of opportunities?
What weaknesses should we fix to counter threats?
Narrow down and deliberate on your most important strategies to achieve your goals. Determine what is feasible.
In VCS, we ensure that there are strategic directions set for our four major management functions: marketing, finance, human resources, and operations.
7. Assess your 5 Bold steps.
To simplify the strategy planning process, determine your Five Bold Steps. These are the 5 Major Strategies that you need in order to achieve your grand vision. Out of these 5 bold steps, what do you need to focus on and what needs to be done this year?
In VCS, our major strategies are in the areas of strengthening our brand equity, improving our customer service, quality standards, employee engagement and continuously innovating.
8. KEY PERFORMANCE INDICATORS & REVIEW SYSTEMS
You already know where you want to go and what you want to achieve this year. Your Key Performance Indicators will enable you to measure your success and track progress in each objective that you set.
For example, if one of your objectives is to improve your team’s capabilities by the end of the year, your KPI’s can be as follows: Number of trainings attended and conducted, increase in employee appraisal scores, increase in skills inventory figures.
It is also important for you to have a periodic review of your progress. In VCS, we set regular huddle meetings, managers meetings and Townhall meetings, for the team members to report their progress in their areas of accountability.
What performance measures are you setting to determine success in each of your objectives? How often should you track your progress?
The Key Performance Indicators may be drafted before your do your SWOT and then recalibrated after the strategy creation process.
9. PROGRAMS, ACTIVITIES & RESOURCES
Now that your KPIs are set, it’s time to get creative by brainstorming PROGRAMS or PROJECTS that you will implement in order to achieve your desired results.
Going back to my sample objective of team capability building with KPIs on number of trainings attended and conducted, increase in employee appraisal scores and skills inventory figures, you can come up with an EMPLOYEE TRAINING PROGRAM which includes external and internal training activities. The program details should be aligned with the specific KPIs set. The main purpose of your programs is to contribute to achieving the figures you’ve set for the year.
What programs do you need to implement in each KRA?
What are the timelines/priorities per quarter?
Are your programs balanced under your key result areas and major strategies?What resources (manpower and budget) are needed to implement the programs?
How do you track progress and what types of reporting systems do you need to implement?
This is the fun part! It’s always best to begin with the end in mind — how do you reward yourself and your team if your goals are met?
Will you have a grand company outing? Will you give performance bonuses if the sales quota is exceeded? You can set quarterly or short-term rewards to motivate your team in achieving sprint goals.
That’s it! Remember that you don’t need to do everything chronologically. You can also get creative and work backwards by starting with your gut feelings in coming up with strategies and SWOT, but always remember to validate them with data!
Questions? Feel free to post a comment below.
Have fun in planning!