Editor’s note: This is the first in a series of articles exploring the Startegic Planning process and its role in business success.
Assessing business is no easy task, especially when asking yourself where you’ll be years from now. Two or three years may seem like a long way down the road, but remember-”time waits for no one.
Business quarters turn into years fast, as you well know. Do you look at business planning ahead of the curve or in the middle of the curve as a necessity? Perhaps thinking of your planning as a roadmap might lighten your concerns and load.
Consider that some destinations require pre-planning, strategy, communication with others and confidence in your decision-making process. You are in command of your destination, yet know that planning is required not only for your destination but the way you set your course of travel.
Sounds simple, but is it? You may be confronted with obstacles, detours, and even unfamiliar off-ramps.
Predicting the future can be nerve-racking and I suggest being proactive with your planning model. After all, it’s more in your favor than playing with your business like a toy in a sandbox-usually a short-lived activity.
This is where the time-tested tool referred to as the strategic planning model can intentionally drive your business forward. Perhaps now is the time to reassess, recreate, or even re-launch your personal business model.
Explore Your Vision
Exploring your business vision and taking steps toward strategic planning is an exercise that is particularly important in challenging times. In three words, you’re improving efficiency.
The essential benefits of realigning yourself with your rekindled strategic plan include:
- Reflection of the values of your organization
- Inspiring change and revision in your product line and target market
- Clearly defining the criteria for achieving improved success
- Assisting everyone in daily decision-making
The reference points are worth your thought, work, communication and due diligence. Consider that effective aftermarket leaders are constantly improving their company’s planning models and developing doable strategic plans. They anticipate the future of their roadmap. After all, time waits for no one.
As a multipart series on business planning for the aftermarket professional, I will reflect on the principle of formulating a roadmap that describes how your company can execute a strategic plan strategy. You will have at your fingertips specific guidelines and checklists to help you with your process of crafting your company strategic plan.
I also suggest you not be concerned with developing the perfect strategic plan. You’ll notice that this is an ongoing process with your company in mind. You’re an individual with a company that has its own prowess and personality, culture and timing.
Let’s go for the ride.
The initial thoughts concerning your understanding and development phases of strategic planning are not to be taken lightly. There are five specific concepts to understanding the prelude to planning and development.
Strategic plans provide the following aids to sustainable success:
- A tool of confidence and direction for established aftermarket owners and managers who are serious about growth
- Helps build your competitive advantage
- Communicates your strategy to your managers and staff
- Prioritizes your financial needs
- Provides focus and direction to move from plan to action
Just as with a chassis of a vehicle, think about how your strategic plan supports your business. Think of the frame with cross-members, strength points, shapes, bends and brackets.
Normally, you look at the overall function and purpose of the frame. You’re thinking and planning for specific design features for drive and ride, handling characteristics, target market, budget and so on. You know that all the components blend and are embedded in your process.
If you’re trying to explain to your planning team how pieces of the puzzle fit together, first you must understand the following components:
Strategy and Culture
Your organization’s culture is made up of people, processes, experiences, ideas and attitudes. Your strategy is where your organization is headed, what path it will take and how it gets there. You can’t have strategy without culture or vice-versa. Your culture is like your house, and if it’s not in order, the best strategy on the planet can’t take it anywhere.
Internal and External
These two components are factual in every business. The external factors extend to customer information, competitors, industry and environment to assess your opportunities and threats. The internal factors extend to employee surveys, assessments and financial statements, along with the composition of strengths and weaknesses.
The Market Focus
Business growth comes from focusing on your customers and delivering superior value to them consistently year after year. Built into your strategic plan is a market-focus framework because of how critical this component is to your company growth and sustainability.
The Big Three Questions
Where are we now? Where are we going? How will we get there?
Knowing the elements of your strategic plan will enable you to process, assess and discover how to execute the action steps to get there. There are a set of statements, factors and identifiers that will enable you to unlock the answers to these and other questions that fit within your strategic plan.
Strategic planning isn’t rocket science, although many find it difficult to define, describe and know where to start. The term actually refers to a coordinated and systematic process for developing an overall plan and direction that optimizes your future potential.
The central purpose is to ensure that the course and direction is well thought-out, fundamentally sound and appropriate for your business and the market. In addition, the process provides reassurance that the limited resources of time and capital are sharply focused in support of an independent course and direction.
The process encompasses both strategy formulation and implementation.
Key Plan Elements
A strategic plan is the game plan that management uses for positioning the company, competing successfully, satisfying customers and achieving good business performance.
However, many business owners and key managers have countless excuses for not having a formal strategic plan. I’ve heard everything from, “We’re too new” to “We’re not big enough” to “We never had one so why start now?”
Do these excuses sound familiar? Studies indicate that approximately 90 percent of all businesses lack a strategic plan. Of those that have a plan, only 10 percent actually implement the plan.
If you represent the majority of 90 percent, consider answering these questions:
- Can your company be more focused?
- Can you be more effective?
- Can your employees be more efficient?
- Can your company be more successful?
A strategic plan can be geared to create positive answers to these questions. It’s been said, “You get what you focus on.” Everyone knows this, but most companies are busy tending to the urgent problems of the day and not focusing on key long-term issues.
Unless you and your staff can focus on a common vision, the company can go nowhere. A strategic plan helps direct energy and allows your team to work toward a shared goal in an ever-changing economic environment.
In order to achieve outstanding results, there is a series of action steps necessary to focus on at the outset. These include your mission statement, goals and objectives that become the roadmap that forges your plan. These will also act as a structure to your employees and lead to a more efficient working corps.
Don’t let these elements be just a paragraph on the break room wall or bullet points in a memo; let them shine as primary guidelines for leading the organization to higher levels of performance. They provide the framework for independent decisions and actions initiated by your department, managers and employees as a coordinated, company-wide game plan.
With everyone on the same page, use your strategic plan to:
- Achieve performance targets
- Out-perform your competition
- Achieve sustainable competitive advantage
- Grow your revenue and maintain or shrink your expenses
- Satisfy customers
- Respond to changing market conditions
We all agree that the aftermarket industry is in a state of flux and development as we all confront the economy while engaging in technology, marketing strategies, funding and advancement of our businesses. As such, you will find tools to help develop a clear-cut strategic plan within the pages of Performance Business magazine.
The staff here believes in the process of aiding your understanding of successful business strategies and continuing the information exchange. Make plans now to attend the business education day at The Performance Business Show next February in Arlington, Texas, to learn more.
Meanwhile, in upcoming issues of the magazine, you’ll receive a strategic plan mini-course of understandable application steps to better build your aftermarket business. Of course you may contact me personally at (909) 447-0812 or email@example.com for any specific questions or discussion.