Why Strategic Planning Matters
We can all agree that planning in advance saves
time, energy and money. This couldn’t be more true for your business. Strategic
planning involves setting realistic expectations and goals for the future of
your business. This not only gives your business clear direction, but it also
ensures that you have tangible goals and ways to reach them in the near future.
Strategic planning involves setting up a
vision, a mission, and core values for your business.
Vision
Your vision should be more than just the hope
for eventual success in your industry. A company’s vision is a concrete idea of
what your business hopes to achieve in terms of social impact, product/service
quality, and industry changes. Take Amazon’s
vision statement as a great example.
“Our vision is to be earth’s most
customer-centric company; to build a place where people can come to find and
discover anything they might want to buy online.”
This statement is realistic, detailed, and
clear.
Mission
A mission statement might seem like a modified
vision statement, but there are some key distinctions. Your mission statement
is what sets you apart from other companies with similar visions to yours. Two
businesses might share similar visions, like “ending homelessness.” What sets
them apart is how they aim to achieve their vision. Company A could make it
their mission to provide impoverished youth with specialised education so that
they can eventually gain a steady income and afford accommodation. Company B
could instead focus on providing affordable and sustainable housing to those
who need it.
Your mission statement needs to provide a clear
and durable path to achieve your vision.
Core
Values
These are the values and beliefs that your
company holds above all else. These values cannot be negotiated or compromised
due to a changing market or circumstances. Your business’s core values
determine how you progress within an industry. Core values are also not subject
to change, regardless of how successful or well-known a business becomes.
Strategic planning also gives you a way of
monitoring and evaluating your business as the time goes by. If your business
is not meeting your set goals or working towards your vision, then it’s time to
re-evaluate and restructure.
Risk
Management
Managing your daily or long-term risks are
imperative for any business leader or owner. It forms part of strategic
planning in the sense that it encourages a strong sense of direction for your
team. There are three key elements of managing your business risks.
1. Identify
and evaluate the possible risks.
Knowing more about the risks that your business
faces will allow you to predict their outcomes and prevent them from becoming
setbacks. By evaluating the possible risks, you can draw up a list of possible
solutions.
2. Treat
the risk.
Choose the best solution to manage the risk and
apply it. Make sure you choose an option that not only neutralises the
immediate risks, but any others that might follow. Your solution must be
sustainable.
3. Evaluate
the outcome.
After managing the risk, evaluate the effects
of your chosen solution. Knowing whether or not it was effective will give you
the insights you need to manage other risks in the future. This will not only
save you countless hours on research, but it will also give your business a
needed edge.
Risks are a natural part of any business’s
lifespan and without them, you might not be reaching your business’s full
potential. Learning and adapting are invaluable skills that will only benefit
your business and employees in the long run.
Comments
Post a Comment