It seems as if business owners are having a much shorter lead time to react to market forces. If you don’t adapt quickly, you may not be around to make changes later. So how do busy entrepreneurs keep in touch with change?
One way is to have a strategic planning process in place that is visited on a regular basis.
A strategic plan should be a short written document that describes who you are, where you are now, where you want to go and how you are going to get there.
The “who you are” is the mission and values of your business. Every business should have a mission statement that expresses the nature of the business and its purpose. This statement should describe what the business does, who it does it for and how it competes in the marketplace.
The purpose of the mission statement is to keep everyone in the company focused on the company’s key purpose(s).
The values of a company are the core beliefs of the company that guide its behavior with regard to employees, customers, stakeholders and the population in general. Often business owners say they are unsure of their core values. When this happens, I ask the owner to tell me what they will not tolerate in the business.
For example, an owner may say they will not tolerate lies, stealing, mistreating the customers, tardiness, etc. Then I tell the owner their core values include honesty, integrity, quality customer service, promptness, etc.
The “where you are now” is an analysis of how you are doing at this point in time.
One of the best ways to get a handle on the where you are now question is by doing what we call a SWOT analysis. A SWOT analysis is where you analyze your company’s strengths, weaknesses, opportunities and threats.
Strengths and weaknesses are internal to your business whereas opportunities and threats are external. Although you may not have any control over external factors, they can and do impact the success or failure of your business and you must determine how to deal with them.
Internal items that you typically assess would be your marketing, management, operations, finances, products/services, accounting systems, human resources, etc.
External factors that you analyze would be the economic environment, the technological environment, the competitive environment and industry trends.
The information developed during your SWOT analysis will help you leverage your strengths, minimize your weaknesses, position to take advantage of opportunities and reduce or minimize the threats.
In addition to helping you determine where you are now, this SWOT analysis helps you determine “where you want to go.”
I tell entrepreneurs that half the battle is determining where you want to take your business. Because once you discover the where, then the “how you are going to get there” is much easier to figure out.
No strategic plan is complete without a definite action plan that states what must be done, when it must be done, who is responsible to get it done and how it will be measured.
Based on your SWOT analysis and guided by the company’s mission and vision, you should have a set of business strategies that will guide you for the next 12 to 36 months.
But don’t forget, the world is constantly changing and you must regularly revisit your strategies to adapt to this changing world.
Lynn Vos is area director of the University of Georgia’s Small Business Development Center. Contact her at 912-651-3200.