As a small business owner, you’re tasked with making big decisions. How do you know if it’s the right time to make an investment? Are you putting your business on the right path? Having a strategic plan can help.
The Hartford provides key components to create a strategic plan that will serve your small business. Including these detailed sections will help you and your employees stay on the same page and understand what you want to accomplish. A properly made strategic plan is not only thorough, but also helps ensure each section comes together to create a cohesive document to support you in leading your business.
- Vision – Think of a vision statement as what your small business looks like in an ideal situation. What would your company be doing if it were operating in an industry with no risks or challenges? What goal do you want your business to accomplish that seem far fetched, but can still be achieved? (These may also be referred to as stretch goals.) These are big questions, yet the vision statement is important to strategic planning because it tells you and your employees the direction your business is headed in. Vision statements are simple and to-the-point, and yet they convey a particular point of view and a depth of information. You can get a sense of what the company stands for, what they aim to be, and their strategy. To write a good vision statement, think about the impact you want your company to have on your customers or society, or what you want people to think of when they see your company’s name.
- Mission – A mission statement is similar to a vision statement, but includes more specific details on actions. The mission statement will detail what your company does and it explains to people outside of your company why your business exists. In some cases, you can mention specific products or services in your mission statement. Other times, you can describe an issue you and your business are passionate about fixing. When you’re creating your mission statement, put yourself in your customers’ shoes. Craft your mission statement so a customer or client can understand what your business does and why. Think about why you started your business in the first place; use that reasoning to create your mission statement.
- Goals and Objective (Short-Term) – The goals and objectives you include in your strategic plan should align with your mission and vision statements. They indicate how your business is going to grow in the future. The goals you choose also should be measurable and include a time frame. When you’re creating your goals and objectives, remember to be realistic. Don’t be overly ambitious. While realistic stretch goals can inspire your team to better performance, if you pick a goal or objective that is not possible to achieve, it could leave you and your employees discouraged. The top three reasons strategy implementation fails:
- Poor communication
- Lack of leadership
- Using wrong measures
- Action Plan – Action plans help keep you and your employees accountable to achieving the goals and objectives you’ve set out in your strategic plan. Your action plans can be broad or can contain specific details; it depends on the goal or objective the action plan supports. When you or your employees look at the action plans in your strategic plan, you and they should be able to quickly understand how the company and/or each business area will achieve the stated business goals and objectives. If your action plan includes deliverables, you should be able to see what needs to be done, when it needs to be completed by, and who is responsible.
- Scorecard – A scorecard helps you and your employees track your progress toward the goals and objectives. If you set a goal to reach by the end of the year, a scorecard will help you understand where the business is during different points in time. This is why it’s important to have measurable goals and objectives. If your goals or objectives are too broad, it could be difficult to measure and track your progress. You can incorporate the scorecard into your action plan, so you and your employees have all the information in one area of the strategic plan. Here’s what an action plan with a scorecard could look like:
For a strategic planning template and specific examples of the key components, read the full article – The Hartford – SmallBiz Ahead.