Strategic Business Plans and Implementation

Business Planning

A strategic business plan provides an overall framework to guide the development of the business and to set reference points for decision making. The process has an established form and logic. Strategic planning is an important business activity and should produce goals and outline how the business will achieve them. Business strategy consultants can bring a fresh perspective and specialist skills to the process. The process has an established form and logic.

Any strategic planning process has 3 elements to it:

• Where are we now? 
• Where do we want to be? 
• How are we going to get there? 

From a business planning perspective, the three steps are:

1. Where are we now? Situation analysis
2. Where do we want to be? Strategic intent
3. How are we going to get there? Operational plans

The Strategic Plan consists of the situation analysis, the strategic intent and the identification of the big picture strategies.
The Business Plan provides the operational detail of how the strategy is to be implemented.

Situation Analysis

The situation analysis considers the internal and external conditions within which the business operates and establishes its current operating position. It will consider:

• The operating environment – Sociological, technological, economic and political trends (STEP analysis),
• The strengths, weaknesses, opportunities and threats (SWOT analysis),
• The current trends in the industry (market),
• The trends by product and customer,
• The activities of the competitors,
• Growth mechanisms and opportunities,
• Any clearly observable internal issues that require attention,
• The current financial position,
• The core competencies of the business, and
• An analysis of the risks that the business is exposed to.

The consideration of these factors should lead to the identification of the priority issues and the high level strategies to address them. Key performance indicators (KPIs) can be identified that will signal whether or not the business is on track in addressing those priority issues.

Key result areas (KRAs) are normally defined for each of the four fundamental aspects of the business. In essence, this is the “Balanced Scorecard” approach.

• Customers (marketing) 
• Operations 
• Finance 
• Staff 

There may also be value in determining KRAs for the compliance environment that the business operates in.

Strategic Intent

The strategic intent of the business outlines the overall direction and business definition for the organisation. It is likely to remain unchanged in the medium-to-long term. It will describe:

• What the business will look like in 3 to 5 years time,
• What the owners / shareholders want to achieve from the business in the long term,
• The activities that the business will be involved in,
• How the business reflects the values of the owners and staff,
• What the sustainable competitive advantage is, and
• The high level goals.

Business Plans

Once the strategic intent is known, the detailed business plans that will deliver the vision can be developed. They are likely to be updated at least annually and become the short term reference points for managing the business. Operational plans need to be addressed from the perspective of the four key functions within the business:

• Marketing,
• Operations, 
• Financial Resources, and
• Human Resources.

There are various ways that each plan can be constructed. Typical issues that would be considered for each area would include:

• Marketing
  • Confirm and quantify the marketing objectives
  • Determine what market the business is really in and who the customers are. 
  • Segment the market and define the targets
    • Size, growth, share
    • Demographics
    • Buying motivators
  • Develop the value proposition for each segment
    • Price
    • Quality
    • Flexibility
    • Delivery
    • Reliability
  • Product and service development and innovation
  • Promotion
    • Branding
    • Lead generation
  • Distribution
    • Channel selection
    • Sales plan
  • Systems development
    • Determine whether existing systems can cope with proposed plan

• Operations
  • Establish the capacity requirements
  • Review the location and capability of facilities
  • Decide which processes need to be owned (i.e., are part of the fundamental technology) and which can be outsourced
  • Describe and document the processes. Determine where waste can be eliminated through the introduction of Lean techniques
  • Identify opportunities to improve efficiencies through process and technology development.
  • Review sourcing and supplier relationships
  • Establish requirement for Health, Safety, Environmental & Quality standards
  • Define the key result areas. Set benchmarks.

• Human Resources
  • Define the organisation structure required to deliver the strategic vision
  • Develop people profiles and position descriptions
  • Determine the training / development and recruiting requirements
  • Develop performance standards and remuneration strategy
  • Identify culture development gaps
  • Establish feedback and evaluation mechanisms

• Financial Resources
  • Prepare forecasts of P&L Statements and Balance Sheets for 3 years
  • Prepare cashflow forecasts for 3 years
  • Determine how to finance operational cash shortfalls
  • Determine how to finance growth and when funds will be required

The operational plans should be summarised into action statements with timeframes and success measures. The action statements become the management tool that is reviewed monthly to determine whether or not the business is on track.

The most important element of the whole process is to ensure that once the Plan has been developed that it actually gets implemented. Gibsons’ Strategic planning consultants can help you perform an analysis of where the business is and develop goals and the road map to reach them. We can providestrategic consulting, advice and the hands on assistance you need to put your business plan into action as well as help keep you on track to meet the timeframes that the plan requires.