CEOs: What’s the value of a strategic business plan?
Did you know that, mathematically, if you improve revenue by 2% per month, you will more than double your business in three years? The value of a strategic business plan, then, is to create the “how to” strategies, initiatives and resourcing to get there.
So how do you get this done?
Consider these 5 Ways to Fix Your Focus. They will go a long way to ensuring the strategy is actionable and executed.
1. What do you stand for?
So often we think only of how our products and services rack and stack vs. competitors. Throw out the marketing jargon of “positioning” for now. For you, CEO, this is personal. This question goes deeper than that – into the roots of your business and beliefs, whether you are an owner, founder, CEO or president stewarding the business.
For example, if you are a SaaS company offering a superior GPS app, you may sell subscriptions for better directions; however, you might stand for “road superiority.” Eric Ryan, co-founder of Method (household cleaning detergents) describes what his upstart challenger company stands for: “We are people against dirty,” even though what his company sells is soap.
2. Who do you serve?
It’s impossible to discuss what you stand for without considering your customer. And it’s easy to forget that your customers don’t really care what products or services you provide. They only care what you do for them.
By looking at your customer through the narrow lens of what you’re selling them, you sell both them and yourself short. By going deeper to gain better insight into their world – their motivations, beliefs and behaviors in the context of your industry, you can develop true insight: the origins of great and enduring strategies.
3. What is your competitor’s plan to win?
If you were your competition, what key actions would you take to beat yourself? What are the keys to successfully grabbing customers and profitable share from your business? By developing your own version of this plan, you can mitigate the risks and potentially identify improvements or innovations.
4. Who’s on board?
Is your executive team aligned with where the business needs to go and what will it take to get there? In Growth Gears, CEO Art Saxby and Principal Pete Hayes outline a four-step process for alignment:
- Identify the destination
- Understand why getting there is important
- Identify how to get there
- And finally, how employees’ jobs and lives will be better upon arrival
5. How synchronized is the implementation?
Do your teams report successful programs and initiatives, yet overall business results are lacking? Have initiatives or programs become ends unto themselves? Critical to fighting the perilous tendency to confuse activity with results is to develop an implementation plan as part of the strategic business plan, and then relentlessly reward progress and results tied to plan goals.
So how do you calculate the value of a strategic plan? Mathematically, it’s equivalent to:
(GOAL + PLAN) X (ALIGNMENT + EXECUTION) = VALUE
While I can’t guarantee you will achieve your goals, from what I’ve studied and experienced over the years, I can say the following: If you are clear on what you stand for; have actionable customer and competitor insights; and if teams are aligned and executing against the same plan, you will have a much better shot.