Companies have been subjected to a constantly changing environment in recent years, whether in market trends, the economy, new technologies, suppliers, or competitors. We have a challenge: to adapt to the current context and become a volatile and flexible organization. In this article, to help companies that do not quite know how to adjust to this new era, paper writer service explains how to make a strategic plan for your company step by step. Read on!
What is a Strategic Business Plan?
Before we start explaining how to make a strategic plan, let’s see what exactly it consists of. Strategic planning is an organizational management activity used for the following purposes:
- Establish priorities
- Focusing energy and resources
- Strengthen operations
- Ensure that employees and other stakeholders work toward common goals
- Establish agreements on results
- Allocate expected outcomes and adjust the direction of the organization in response to a changing environment
An effective strategic plan defines where the organization is going and the actions needed to make progress and how we will know if we are successful or not.
In this sense, a strategic plan is a document used to communicate its objectives, the actions needed to achieve them, and the other critical elements developed during the planning exercise.
New Paradigms for Being Strategically Competitive
Today the paradigms have changed. Today, to be strategically competitive, we have to try to focus on new business models. Consumers want things to be customized, personalized, and generally:
- Make it portable
- Small in size
- Personalized and customizable products
- Hybrid vehicles
- Innovative products and companies that bring creativity and differentiate themselves in the market.
- Entertain us through games
This digitized and hyperconnected environment is essential for our strategic thinking as entrepreneurs or as startups. Thanks to the Internet, we can reach millions of people in a matter of minutes. Digitalization has also driven the creation of new business models that must be taken into account.
The New Customer of the Digital Era
The post-digital pandemic customer is not the same as before. They have very different needs and ways of buying. Brands must research, recognize and adapt to these habits. Today’s consumer is a prosumer, he participates with us when it comes to telling us what we have to offer them. They are also unfaithful:
- It is unfaithful, demanding, and has a lot of power over companies and products.
- They are more educated and complex
- Is hyper-connected
- They require greater personalization of products and services.
- Has new buying habits
- Is committed to their values
Increasingly, people are using more and more of the left side of the brain. This is the area where emotions are located. The so-called limbic system works 80,000 times faster than the thinking cerebral cortex, proving that humans feel before thinking. Therefore, it is necessary to try to keep emotions out of the decision-making process.
We must adapt to this changing environment by developing strategies to meet the demands of today’s society. Many companies have had to transform their offer to stay afloat.
Social Networks, Key to Business Strategy
Today’s business world is focused on social networks. Although we only know the most popular ones, such as Linkedin, Facebook, or Instagram, there are around 2,000 networks worldwide that bring together millions and millions of users.
The real change is not in technology but in communication, mentality, and adaptation to the environment in which we live.
We are talking about the fact that companies and customers are becoming more and more conversational and that we, as entrepreneurs, will have to be true digital leaders.
How to Make a Strategic Plan for Your Company
Now that we are more aware of the context surrounding us let’s see how to make a strategic plan to implement in your business. Take note!
- Vision, Mission, and Values
Everything in the company has a why and a what for. The first thing to do is to be clear about the company’s mission. The raison d’être, its DNA, its identity! Not to be confused with values, which are the essential and permanent principles of the company. And values, in turn, should not be confused with cultural practices or specific operations.
In the end, the exciting thing is that the public associates our company with a way of being or a word that, when visualizing our logo, is linked to it. It includes establishing the mission, vision, and values in the strategic plan called the visualization process, in which the image of excellence we wish to create is projected.
- SMART objectives and goals
To achieve that mission, we have to set SMART objectives and goals. The objectives are usually medium and long term, from one to three years and three years onwards, while the goals are short term, less than one year. They must always be SMART, that is to say:
To achieve this, we must consider strategies and tactics. Systems are what I do to achieve the objectives, while tactics are what I do to achieve the goals. A set of short-term goals would be an objective, and a bunch of tactics would be a strategy.
- Timeline or Calendar
All these actions should be reflected in a chronogram, histogram, or timetable. The objective is to put it visually in the form of columns to help us remember achieving what has been proposed. One of the best ways to do this is to divide the document into seven columns with the following information:
- Objective it fulfills
- Target I am addressing
- Action or task involved
- Financial cost
- Duration or time frame
- Responsible for the company
- Measurement or KPI’s we are going to use
- Choosing a Good Team
There are four important issues when planning the Strategy related to the people who will help us implement it. The ideal employee is someone who should have the following characteristics:
- Teamwork: Teamwork is not the same as teamwork. Teamwork implies the three C’s: co-create, cooperate and coordinate.
- Creativity: That they are a creative person.
- Proactivity: Not to be reactive and to help us achieve our goals.
- Empathy: That they are an empathetic person who knows how to put themself in the place of the client, supplier, administration, etc.
- Challenge: to Get out of the Comfort Zone
We are used to not leaving our comfort zone. Today, we only decide to change a strategy out of conviction or convulsion. We are free to determine what role we will play in the face of adversity or on a day-to-day basis. We have two options:
- Take the victim role in which we blame circumstances and others.
- Take the protagonist role in which I assume my leadership.
We must keep in mind that the Strategy we are doing sometimes does not work in this new uncertain environment, and we should not wait for anyone to come and solve our strategic problems.
- Technology: driving accelerated change
One of the most significant changes is related to technology, so if your company has not yet joined the digital transformation, you must do so to survive in the future. Not only as a sales element but also externally. In recent years, the growth of social networks has led to the acquisition of customers at rates never seen before.
We have to acquire new purposes as entrepreneurs:
- We need to change the mentality since because of globalization, we have competition all over the world.
- We must have the ability to “unlearn” bad habits.
- Change our style and Strategy
- Continuous training and improvement
- Be motivated to change
- Customer Service Strategy
The essential difference between emotion and reason is that emotion leads you to action while reason leads you to a conclusion. That customer service strategy must be fundamentally based on emotion, not reason. Increasingly, customers want to perceive emotions and feelings: they no longer want a product based on reasoning. It is a key aspect to take into account throughout the strategic plan.
- Tools for the Strategy
Before getting started with the strategic plan, the first thing to do is to make an analysis in which there are four main inputs:
- How and where is the market going?
- What direct and indirect competition do I have?
- Who are our target and potential customers?
- How do I connect all this with technology?
Trend analysis will help us know where to go and closely understand the context surrounding us.
Types of business strategy
Not all business strategies have the same structure or seek to achieve the same objective. For this reason, we explain below the most common types of business strategy:
- Management-Based Strategy
In the case of a strategy based on management, we will have to make an external analysis (PESTEL) and a more internal analysis of the sector in which we would see the suppliers, the substitute products, and the direct and indirect competitors. From this, we would implement the strategic plan.
- Risk-Based Strategy
In this type of Strategy, the most important thing is to analyze the market using intuition. It provides a structured and consistent approach to identifying, assessing, and managing risk.
It is based on periodically updating and revising the assessment based on new developments or actions taken. It can be implemented by small groups and projects or incorporated into a complex strategy for an international organization in multiple countries.
The focus of this Strategy is to identify and review the risks faced by an organization. By assessing the risks, we can detect where the uncertainty around new trends lies and identify the steps that need to be taken to protect the company, the people, and the assets involved.
This Strategy is aimed at those sectors that have evolved in just a few years, whose failure to adapt could spell their end. It is the case of photography or camera companies that have had to face the arrival of the latest generation of smartphones or travel agencies that have suffered from the appearance of airline ticket and hotel price comparators on the web.
- Strategy Based on New Business Models
By new business models, we mean recent trends. The objective of this Strategy is to adapt to new purchasing habits. The most important new business models today are the following:
- Marketplaces: both focused on a single product and platforms such as Airbnb or Amazon.
- Hyperplane: they sell everything with the Strategy of sweeping away the competition. It is where strong economies of scale come in. For example, Aliexpress.
- Free – Advertising: the goal is to convert the free into the premium. The bait offers free services to charge for more complete services, as Skype or Spotify do.
- Subscription model: an example would be Netflix or YouTube.
- On-demand: this is becoming increasingly fashionable, and the key is to manage alliances. Depending on your blocks, you can offer a better service. It would be the case of Glovo or Uber.
- Strategy Based on Lean Startup
Finally, Lean Startup is an entrepreneurial methodology based on having an idea, launching a product, and finally analyzing whether the sequence has been successful or not. It is based on validated learning.