Step 2 Strategic Planning
Strategic planning is a systematic process designed to; predict future results, determine how those results are to be accomplished and to decide how the results will be measured and monitored. The main objective of strategic planning is to improve the decision making process within a company so it recognizes the key internal and external factors affecting any decision. Strategic planning requires a total commitment from ownership and employees. Strategic planning will benefit the company by helping it build a vision for the future that incorporates all the key characteristics and qualities desired in the company by its ownership. Strategic planning also encourages effective resource allocation to the key products and services that are identified by the process. A quality strategic plan is essential if a company wants to be on par with its competitors. The five parts of a strategic plan are Discovery, Assessment, Planning, Implementation and Monitoring.

Discovery involves assessing the need for the plan and defining its scope. What is the real motivation for the process? What are the concerns and expectations for the process? Is there buy in from ownership and management to ensure the plan will be implemented? What is the cost of the process expected to be? In addition during Discovery, you will decide if an outside facilitator is needed, you will define the role of everyone to be involved in building the plan and lastly segregate the plan, if necessary, by key market and/or business segments.

Assessment involves gathering information, the analysis of that information and the determining the areas of need that will be addressed by the plan. Assessment also includes the analysis of internal and external factors that impact the organization, its products and services. There are three key external factors; environment referring to government, the economy, demographics and technology; markets and customers; the industry including competitors. There are three key internal factors; product mix including pricing and promotion; internal resources including employees, management skills, processes and procedures; the hardware of the company, money, machines and materials.

Examples of internal and external strategic challenges are:

• Increased competition
• Declining market share
• Lack of new products or services
• Sub standard quality
• New competitors
• The introduction of substitute products or services
• Government regulations or deregulation
• Lack of vision for the future
• Failure to reach consensus among key managers on the future path of the company.
• Pressure on margins from customers and suppliers
• Inadequate capital or lack of profitability

Planning starts by revisiting your mission statement and if necessary, restating your vision for the future of the company. Next you will decide which of the areas of need identified during the assessment will be addressed. You will then build an action plan to address each of the areas. Champions are then assigned to each part of the plan and specific action items with resource requirements and timelines are identified and assigned.

In redeveloping your corporate mission you will define your customers, identify what they value, state how you will win your customers business and assert your corporate identity. The restating of the vision includes the establishment of the goals and objectives of the plan and states the essence of what the company is aspiring to be. The vision will include business and personal capabilities, technologies to be utilized and the operating management style.

The assessment will also identify the type of plan strategy that will govern the process. Among the alternatives are start-up or entry into a new product or market, growth or improvement of existing operations and products, maintenance of market position for the company/product or exiting the business through wind down or sale. Additionally, there will be one or more sub strategies selected that will guide the development of the primary strategy and these may include:

• Developing a new market or product
• Developing a new market for an existing product
• Acquisition of products or business segments
• Improvement of service to existing markets
• Withdrawal from products or markets
• Improving knowledge of competitors
• Reduction of costs
• New marketing plans to differentiate existing product offerings
• Expansion of an existing product line
• Specialization of an existing product or market
• Improvement of product performance within a line
• Changes in pricing, selling terms or promotions on product lines
• Improvement of delivery or distribution methods
• Improvement or changes in customer service methods
• Improvement of marketing support systems
• Changes in product distribution systems
• Improvements in administrative efficiencies
• Improvements in manufacturing productivity
• Improvements in product quality
• Achievement of quality certifications
• Obtain capital for investment in products, production and facilities

Implementation is when the company goes about the process of putting in place the recommendations determined during the planning process. This is the step that is most often the downfall of a plan because it imposes extra responsibilities on the employees and often requires change on the part of everyone in the organization. It is critical to have achieved buy in from the employee group to the recommendations of the plan before proceeding with implementation. This step is also where performance indicators and prioritization of the plans components will be established. These indicators will allow the company to measure performance during the implementation stage. The prioritization rankings will allow for adequate resource allocation to occur so that the probability of success for each component in the plan is maximized.

Monitoring involves tracking the results of the plan and compared them to the goals and objectives of each component. There will be predetermined follow up meetings where the entire team will gather to review progress on all the aspects of the plan. It is during these meetings that companies are often faced with the difficult task of deciding to stay the course or modify the plan... This is the time to use continuous improvement and other quality system tools to keep the plan on track to achieving its goals.

Step 3 Capitalization & Financing
A successful company must have access to sufficient capital in order to remain competitive in today’s business world. A thorough knowledge of the available financing alternatives is essential to acquiring the most capital at the lowest possible cost. This step assesses your company in 8 areas of financing in order to determine the optimum financing alternatives that could be available to you. Those 8 areas are:

• Overall knowledge of financing and the alternatives available.
• Knowledge of your personal financial situation.
• Knowledge of your company’s financial situation.
• Knowledge of sources of equity funds.
• Knowledge of sources of debt and mezzanine financing.
• Knowledge of typical terms and conditions on various .forms of financing.
• Development and maintenance of your relationship with your primary lender.
• Understanding of the documentation required to acquire financing including financial statements and projections.

Step 4 Technology & Information Systems
Technology and the optimum use of it has become a major force at competitive firms in nearly all industries. This step involves assessing what technology you are currently using, what your competitors are doing in the area of technology, what options are available to you within the financial limitations that currently confront you and a plan to implement the improvements in your technology systems that are needed. Areas that will be examined in this step include; business software, computer hardware, networks, internet access, marketing materials, faxing methodologies, telephone systems, videoconferencing and training.

Step 5 Human Resources
No organization is competitive without the right people deployed in the optimum manner. In order to outperform your competition, your employees must be properly focused and supplied with the necessary resources to meet the goals and objectives you have set for them. The performance of your employees is tantamount to your success. In this step, you will first assess the strengths and weaknesses of your existing employees and from that analysis develop an action plan that will create a continuous improvement philosophy with your organization. This will include making sure your human resources are incorporated into all your business plans, making available the necessary improvement tools to your employees and monitoring the effectiveness of these improvement plans.

Step 6 Marketing & Sales
Marketing is the interface between a company and its customers. Marketing ensures that a company gets information from its customers about their needs so it can successfully meet those needs. In addition, marketing is responsible for educating the marketplace about the company, the products and services it offers and how those products and services can meet the needs of the marketplace. This step involves examining how the company is performing relative to the competition in the 4 P’s of marketing; product, price, placement and promotion. The end result of this step will be the development of a comprehensive marketing strategy that focuses your resources towards the achievement of your company’s mission.

Step 7 Partnerships
This step is essential to all small businesses. The nature of small business is that we define a niche that we can effectively serve and focus all of our efforts on that niche. However, customers often face the need to reduce the number of vendors, reduce costs or other supply chain management directives that imperil their ability to utilize smaller firms. This is where business partnerships can keep you in the game. Business partnerships or alliances allow you to meet all your customers’ needs without forcing you to take on products or services that you are ill equipped to perform. Business partnerships also avail you the opportunity to converse with other successful business people and exchange ideas in marketing, cost savings opportunities, human resources and production methodologies.

Step 8 Quality Assurance
No business survives long with a substandard product or service. The key to establishing yourself as a “quality house” is to create a “quality culture” within your organization. Quality initiatives cannot be imposed on an organization; they are the product of a collaborative effort between ownership and their employees. Successful implementation requires a buy in from all your employees and superior communication between management and their subordinates. Whether you need an official quality certification like ISO, or not, initiating a continuous improvement process in your organization will go a long way towards making and keeping you competitive in the marketplace.