How to create a business strategy
I recently wrote this article surrounding business strategy for Kochie's Business Builders. Click here to view the full article, or read below.
Running a business seems like a marathon sometimes. It’s a long journey that takes a lot of courage.
However, while our days are full and we are busy focussing on the next meeting or the next deadline, it is important to stop, step back and strategies for the next period. Business as usual is the downfall of strategy.
Strategy is about clarity on how you are going to reach a major or overall aim. It’s the ‘how’ you are going to achieve the outcome. Daily, monthly, yearly, ten-yearly – every business needs a strategy and a pathway to reach your business objectives. Strategy really shouldn’t be something you put off for a quiet month. You need to set time aside and live it each day. Breathe it through your organisation.
It is a subject to discuss with your mentors, your bookkeeper, your employees, partners and even your family. And the best thing is, it is actually fairly straightforward to work out.
RUNNING A BUSINESS IS A LONG JOURNEY THAT TAKES A LOT OF COURAGE
You always need to be able to answer these question:
A) Where is the business today?
B) Where do I want the business to go?
C) How will I get it there?
Whenever I meet with clients to discuss their communications strategies I always ask them the same question: what does success look like? What will we be celebrating when we crack open the champagne? What does success look like spread out on the table, on the whiteboard or in the bank?
Why? Because you need to know what you want to achieve from the outset. If you can’t see the bullseye, how can you hit it let alone aim? And if you don’t know what you want, how can anyone help you achieve?
Most people want to work to do something good, something bigger than themselves. Strategy is about inspiring the bigger picture. It is your job plus more.
After determining your objectives – and remember these must be memorable – the next step is to break your end goal into smaller achievable checkpoints that you can easily plot on a timeline.
For example, to meet your idea of success, decide what small accomplishments must be achieved and by when. It is best to work backwards from your end goal in order to make sure you achieve each of your checkpoints.
When discussing your business goals and business strategies, think of them as two separate things and both should be clearly identified. Once you have both your objectives, your strategy is a map or set of instructions on how to get there.
For example, a football coach may have the end goal of his team winning their next game. But his strategy is a different matter. It might be to increase the player’s defence training or their stamina through new exercises.
DECIDE WHAT SMALL ACCOMPLISHMENTS MUST BE ACHIEVED AND BY WHEN
S.M.A.R.T. goals
These are my favourite kind and they involve establishing objectives that are:
Specific: A specific goal has a much greater chance of being accomplished than a general goal
Measurable: Establish concrete criteria for measuring progress toward the attainment of each goal you set
Attainable: When you identify goals that are most important to you, you begin to figure out ways you can make them come true. You develop the attitudes, abilities, skills, and financial capacity to reach them
Realistic: To be realistic, a goal must represent an objective toward which you are both willing and able to work. A goal can be both high and realistic; you are the only one who can decide just how high your goal should be
Timely: A goal should be grounded within a time frame. With no timeframe tied to it there’s no sense of urgency
Strategy: is a clear statement about a chosen course of action for obtaining a specific goal or result.
EXECUTE, ADJUST, EXECUTE
This 12-step strategy list covers the major checkpoints of what a business should do to reach its goals:
- A company overview. Identify what business you are in and where are you now.
- Identify your values, beliefs, attitudes and capabilities.
- Write or review the business mission statement.
- Perform an environmental analysis.
- Perform a SWOT analysis.
- Determine your competitive advantage.
- Seek performance breakthroughs and spend time on improving your performance.
- Understand and apply cause and effect relationships for the four basic ‘perspectives’, those being, Human Capital, Structural Capital, Customer Capital and Financial Performance. How do they impact upon each other?
- Develop a strategy map. This outlines your goals for each of the four perspectives. 10.Translate goals into KPMs and perform gap analysis. What are you missing?
- Prepare a scorecard to track and drive your grand strategy.
- Will you meet your targets?
- Execute, adjust, execute.
Plan B
With the current economic environment, many people question whether they should even bother with strategy when there is so much uncertainty. But in my opinion, tumultuous times make strategy even more important in keeping you heading towards your goals.
While your goal may not change, your strategy may need to adapt so be prepared for this. Every industry is constantly changing. Eighteen years ago, I certainly did not have social media expertise as part of my strategy to be a leading integrated communications agency.
Little did I know back then it would become a major part of my business or that today (in my industry at least), you are not relevant without understanding it. Be prepared to adapt to a changing world and be flexible with your strategy. Adhere to your mission statement and be clear on what it means. This way, while its strategy may change slightly, its core remains the same.
KEEP AHEAD OF THE GAME!
Micro strategies
So take time to implement strategy in the daily running of your business. This means knowing what you want to achieve each year and breaking down each quarter’s strategy accordingly. Have a meeting every day, every week, every month.
Your strategy keeps the bigger picture present and helps keep you and your team on track towards that end goal. You will be alerted to any issues much sooner and can redirect focus quickly.
While your goals may be big, your strategy breaks it down and keeps you on track. Having small, specific achievable strategies can provide a pathway to reaching the bigger picture that often seems daunting or out of reach.
Finally, the future looks nothing like the past – strategy helps you realise that and keep ahead of the game.
