When you’re growing a business, you have to make many decisions about where to invest your resources and time. The following five business-planning strategies can help make this process easier.
[Read more: Scenario-Based Business Planning: What It Is and How to Use It]
Outline a mission statement and vision
In the early stages of building a business, most entrepreneurs will outline a mission statement and vision for the company. These two high-level statements will guide the direction your company is headed in going forward.
A mission statement explains why your company exists and what the purpose is. A vision is a more strategic and timebound plan, and it typically focuses on what it is you offer and where your business is headed.
Strong mission and vision statements can help your employees identify with the goals of your company and see their work as more meaningful. Research shows that employees who identify strongly with the company’s mission and vision statements are more engaged and productive in their jobs.
SWOT analysis
SWOT stands for strengths, weaknesses, opportunities and threats, and it’s a model you can use to look at the internal and external factors affecting the company. It can help you develop an awareness of all the factors involved in making decisions for the business.
To do a SWOT analysis, you’ll use a 2x2 grid with four squares representing each aspect of SWOT. The strengths and weaknesses are the internal factors affecting the company, while opportunities and threats are external factors.
It’s important to not only look at each category but also to look for possible connections between them. For instance, could any of your company’s strengths open up new opportunities in the future? Do any of the weaknesses also create possible threats?
After you’ve examined all four areas of SWOT, you can come up with a list of potential actions to take going forward. Overall, a SWOT analysis is a great way to see where your business is doing well and identify areas where it could improve.
At what point would you like your business to be in the future?
Competitor research
Competitor research is a key aspect of any strategic business planning. This type of analysis will show you what your competitors are doing right and help you identify areas where they are falling short.
To ensure that the information you receive is useful, you need to choose the right competitors to examine. It can be helpful to analyze both direct and indirect competitors. For instance, some companies may offer a similar solution to yours but serve a different type of customer.
From there, you’ll want to look at the company’s metrics, the products it offers, the customers it serves and its marketing strategy. This analysis will give you a better understanding of the overall market, as well as ideas for how you can improve your business.
[Read more: Sizing Up the Competition: How to Conduct Competitive Research]
Gap planning
Gap planning is an analysis of where your business is now, as opposed to where you would like it to be. After analyzing, you can come up with strategies for how to bridge that gap.
The first step to performing a gap analysis is to identify the business goals you want to achieve. At what point would you like your business to be in the future? Be really specific about the objectives you want to achieve.
From there, you can analyze where the business is currently in regards to each of those objectives. Then you can identify where the gaps are and what’s stopping you from reaching those future business goals.
The Theory of Change
The Theory of Change is a process to help you achieve your business objectives. It involves identifying a long-term goal and using “backward mapping” to identify the preconditions that must be met to achieve that goal.
Next, you can identify the activities you must engage in to meet these preconditions and meet your long-term goal. Then you’ll create a narrative that will summarize all the moving parts in your plan.
The Theory of Change can give you a better understanding of how the change will actually occur in your company. This can lead to better planning and help you reach your objectives more effectively.
[Read more: Starting Over? How to Write a Business Plan for a Post-Pandemic World]
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