Whether your company is a start-up or a growing enterprise with plans for expanding, a properly-developed strategic business plan is essential.
A successful plan is a written, well-considered roadmap that efficiently coordinates the progression of all actions and elements of an enterprise from a starting point to a desired future level.
Below, we discuss the important aspects of a strategic plan and how taking this step adds accountability within your organization from the top levels down.
Purpose and Vision of Your Written Plan
The first step of a business plan is to define specifically what you wish to accomplish — what you plan to do and how you plan to do it.
If the company is a start-up, the objective may define how your company fits into the industry, designate a potential customer base and a growth objective. Similarly, with an existing company, the vision will define steps to be taken to reach a higher level.
In either case, all elements of the business plan must have specific objectives and coordinated strategies to achieve the desired level of success. Once begun, each employee’s activity, every financial decision and all marketing efforts should be focused on that vision.
Responsibility and Accountability
In each case, attainment of each action plan should be the responsibility of specific individuals. Written goals, action plans and strategies, plus regular progress reviews, can emphasize the importance of the achievement of individual efforts on behalf of the overall enterprise.
Every individual must feel accountable for the success of the company. Having a documented plan for how each role is expected to contribute to the overall goals can reduce confusion and disagreement.
Usually, a strategic business plan contains several levels of responsibility. If you happen to be a sole proprietor or the only employee in the company, of course, you’ll be responsible for all activity. Still a strategic business plan can help direct your actions. Otherwise, your strategy should include a plan for how different levels of employees will work together to achieve goals.
Here’s an example of the different levels of responsibility and accountability:
Vision: Grow Company Profitability by 25% (CEO)
Business Objective: Increase Gross Margin by 15% (Top Management)
Action Plan: Reduce Packaging Costs by 3% (Purchasing Manager)
Strategies: 1) Source more competitive material suppliers to achieve 2% reduction in raw product costs (Buyer) and 2) Improve logistics costs by 1% (Logistics Manager)
A successful strategic business plan gives clear responsibility and accountability to the employee to accomplish specific and measurable objectives. In addition, your strategy should be supported by other documentation and resources, including a company operations manual and structured sales materials.
When strategies and policies are documented and shared, everyone is focused on the overall objectives and all activities are directed toward the company vision.
Objectives, Timeline and Employee Commitment
Objectives establish the course of action in specific terms while the timeline defines the sequence and timing of actions. Accomplishment of the objectives and timeline should result in the successful attainment of your vision.
Each individual or department should break down their objectives into individual action plans that align with the overall objective. In a small or start-up company, the responsibilities may be spread over just a few people, while in a larger business, the responsibilities may involve several. In each case, individuals will have plans and tasks for which they are responsible and specific time frames in which to execute their tasks.
To ensure everything is working in harmony, you will need to establish regular updates on the progress of each individual’s or department’s progress toward accomplishing their assigned objectives. One underachieving element slows the overall progress and must be addressed. Additional resources may need to be applied to the specific area. You may need to re-evaluate the goal or otherwise support the staff responsible.
It is critical to have an accurate financial assessment included in your strategic business plan. Assets on hand and the maximum amount of money that can be borrowed will determine how quickly and whether you will be able to address your vision. Elements such as the marketing budget, equipment and inventory, occupancy costs, insurance and payroll must be realistically calculated against all growth objectives.
The effectiveness of the sales team, marketing support, cost management and efficiency will determine the rate at which your goals can be met. And these could be limited by cash flow restrictions.
Plan for Accountability
A written, well-thought-out business plan presents your vision, purpose and objectives. Your business plan communicates your overarching business goals in an objective and critical way, giving a framework for future operations, growth and investment.
When leadership and other employees know what is expected, proper commitment and execution can be expected.