A Strategic Planning Short Course

Up now is A Strategic Planning Short Course, presented in two parts. Each discusses one of the two parts in my simplified planning process--the first part of the process I call Strategic, and the second part I refer to as the Tactical, or Deliverables. Discussed now in Part 1 are the Strategic elements of planning.

Business planning is a term often used synonymously with strategic planning. I would like to make a distinction. Business planning is best associated with the preparation that occurs prior to going into business. It also occurs after the business opens, when a company is seeking extensive external financing, usually through venture capitalists. 

If you are trying to raise a significant amount of capital, you will need a five-year business plan. You might want to read Business Plans That Win Dollars by Stanley Rich and David Gumpert. It's the best book I've found on business planning. 

The emphasis of Habits of Wealth is to create wealth through effective entrepreneurial thinking. As a result, we deal only with Strategic Planning, typically a three-year plan with annual updates. It formalizes in writing the focus, direction, and expectations of an organization. Strategic planning, when properly executed, makes success happen, 

Shortly after it became obvious our Tri-State Neighbor magazine would succeed, our general manager and I, with agreement of his key people, identified in our Strategic Plan when the magazine would reach one million dollars in annual revenues. We set this objective four years before the goal was achieved. We reached our million dollar objective at the planned time and immediately created a new objective for reaching the two million mark. 

When a Strategic Plan is not in place, the company's direction is no clearer than an unlighted street at midnight. Vision is blurred. The company floats like a riverboat without a rudder. Without an organizational strategy, employees will design their own plan. It might be to get by with the least effort possible, participate in office politics, or give authority to an informal, self- appointed leader who lacks the information necessary to give meaningful directions. Planning is an effective antidote to these and other corporate poisons. 

Strategically planned goals and objectives are the wood on the fire of success. Like wood, the plan must be occasionally replenished to keep the fire hot. Planning is a process requiring annual renewal, 

Strategic planning intimidates many who attend planning seminars or read about it. It needn't be that way. The planning short course that follows is just that—a simplified, abbreviated method offering you an opportunity to get out of the starting blocks. 

Many organizations prefer that an experienced facilitator walk them through their first strategic plan. That's a good idea. One thing I know for certain, having facilitated many planning sessions, is that the plan gets done that way. The initial plan has special importance, since it acts as the foundation for subsequent planning. If, after reading this Habit, you have reservations about leading an initial strategic planning session yourself, find someone qualified to help you. The return on your investment will be enormous. 

Answers to Common Planning Questions 

Q: How often is strategic planning done? 
A: Most plans are for three years, with annual updates. 

Q: When is the best time of the year to do your strategic planning? 
A: You will want to have your plan completed at least one month before the beginning of the fiscal year covered by the plan. 

Q: Who is involved in the planning process? 
A: If your organization is small (10 or fewer employees), you might wish to include everyone. As an organization gets larger, key departmental personnel usually make up the planning team. After completion, team members familiarize other appropriate employees with the plan. 

Q: How long does it take to do a Strategic Plan? 
A: For companies of small to medium size the initial plan will usually take two full days to complete. Thereafter, annual updates will usually take at least one full day. 

Q: How long is a completed plan? 
A: For most small to medium-sized organizations the plan is between eight and 12 pages. The larger the organization, the longer the plan. 

SIMPLIFIED STRATEGIC PLAN OUTLINE FOR AGGRESSIVE, INC. 

1. Definition 
2. Introduction 
3. Develop Purpose and Mission Statements 
4. Develop Organizational Goals, Objectives, and Measurements 

SAMPLE FACILITATOR'S OUTLINE FOR AGGRESSIVE, INC. 

1. Definition: Strategic planning is the identification and creation of the most advantageous conditions possible within which to employ the art and science of goal management. 
2. Introduction: The quality of decisions, plus their appropriateness and timing, will determine the success of your organization. An effective planning process provides the basis for better decision making. Thus, planning is an integral and vital part of any achieving organization. Strategic planning is also known as directional planning. This is appropriate since strategic planning seeks to determine the direction an organization will take.
   Aggressive, Inc. is currently placing major emphasis on the development of the strategic planning process, from which will flow our yearly planning. The success of our planning is highly dependent upon the involvement of Aggressive, Inc. staff. The benefits will include:
   1. Creating a clear, written communication which will serve as a continuous reference point for our strategic direction.
   2. Allowing participation of several key individuals in charting the direction of our organization.
   3. Developing anticipatory thinking, serving to help Aggressive, Inc. be more proactive.
   4. Establishing formal, written, and consistent strategies to direct our meeting agendas, and to provide an annual mechanism for the updating of these strategies. 
3. Purpose and Mission Statements: Part One of the strategic planning process consists of developing the Purpose and Mission Statements. The purpose statement should answer the question, "What do we want to accomplish?" We want to gain an overall perspective of Aggressive, Inc.'s direction. We want to state the scope of our involvement. This scope describes the needs of the marketplace we are serving.
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   Purpose Statement Overview:
   - "What do we want to accomplish?"
   - Might start with "To provide" or "To achieve"
   - Very broad, very conceptual
   - One paragraph
   
   Sample Purpose Statement:
   "To achieve market dominance and higher profitability through an aggressive, proactive, and opportunistic entrepreneurial effort by becoming leaders in the areas of customer delight, local store marketing, media planning, and employee relations."
   
   The Mission Statement further defines our scope and provides an overview of "Why does Aggressive, Inc. exist?" It also describes long-term growth direction.
   
   Mission Statement Overview:
   - "Why does Aggressive, Inc. exist?”
   - Statement might start with "To promote" or "To succeed"
   - Two to four single sentence paragraphs
   
   Sample Mission Statement:
   The mission of Aggressive, Inc. is:
   1. To provide customer delight by creating an obsession for exceeding customer expectations.
   2. To maximize profitability by establishing and effectively implementing guidelines and follow up procedures to ensure our high standards of excellence are met in all areas of operations.
   3. To increase revenues by providing positive and efficient marketing communications that create retention and expansion of our customer base.