Strategic Plans are a must for all SME's
Small to medium sized enterprises (SME’s) are the backbone of the Australian economy – they constitute over 99% of all Australian businesses.
Many SMEs have plans in place for day to day operation of the business, however very few have any form of Strategic Plan in place – and many can get ‘stuck’ without long-term goals. A recent report ion corporate insolvencies released by the Australian Securities and Investment Commission (ASIC) found that 44% of failed businesses suffered from poor strategic management and planning.
What is a Strategic Plan?
A Strategic Plan defines the purpose of the business, what goals the business aims to achieve over the coming 3-5 years and what plans the business is putting in place to achieve those goals.
Strategic Plans come in many formats. They can be complex, detailed and thorough for large organisations but a simple one-page Strategic Plan can be very effective for SMEs, outlining business purpose and direction.
Time invested in documenting a Strategic Plan pays off with substantial benefits. For example:
Your people acquire a direction, seeing priorities and where you are aiming to get to.
Risks are more easily identified and managed
You can look back and review progress
Job satisfaction and productivity improve - , staff understand better the direction of the business and their contribution to overall goals and purpose.
You and your team can talk more easily about the overall business.
How to create a Strategic Plan?
Creating a Strategic Plan for your own business does not have to be time consuming. Use these six questions to shape the core elements of the Strategic Plan:
- Where do you want the business to be in four years?
- What services and products will you be providing (same, different, new)?
- How big will the business be (revenue, staff)?
- What clients will you be working with (same, new)?
- How will the business get from where it is today to where you have projected in four years?
- Why will your clients continue to prefer your business to others?
It is more efficient and yields better results if you involve key staff in designing the Plan. Sometimes the greatest benefits come from the conversations that happen when documenting the Plan.
A Strategic Plan is a must for all SME’s, as it provides direction and clarity on what the business is aiming to achieve. Above all, businesses without a Strategic Plan get can get trapped treading water.