From a study on successful company leadership, it was learned that at the nation’s top 5% U.S. companies, leaders spent over 60% of their actual work time on strategic planning. At the other 95%, company leaders spent an average of 7%. Clearly, planning pays off.
So at this point, you should ask yourself the question, “Am I and the other members of my management team too busy putting out fires each day to devote time solely to strategic planning?” If you feel too busy, you are not alone. However, planning is proven to increase profits. Therefore, make a time commitment to that process right now.
To get you and your team started, begin with a series of questions to be completed by key, knowledgeable managerial and non-managerial employees. At Meridian, we use a traditional SWOT (strength, weaknesses, opportunities, threats) analysis as a starting point for planning. The SWOT analysis addresses both internal and external components of your business. It’s useful to conduct the SWOT analysis in categories. Products, Customers, Marketing, Suppliers, Competitors and Internal Systems are a good framework. We developed the following list of questions from various clients and resource materials. Add or subtract questions as you see fit.
Products: What are we selling? (Note: this is a key question – get beyond the obvious, tangible-goods answer.) Should we be selling anything different? What could change about our products in the future that could impact our sales? What changes would that mean for our business? What are product strengths? What are our product weaknesses?
Customers: Who are our customers today? Why do those customers buy from us? Why have we lost customers in the past year? How will our customers change in the next 5 years? What satisfies our customers? How are we doing at satisfying them? How can we add more value to our customers?
Marketing: How do we presently reach those customers? Will that change in the next 5 years? How do our customers want to be reached? Will that change in the next 5 years? What effective ways to reach more customers are we possibly missing?
Suppliers: Who are our present key suppliers? Will we need to add or subtract suppliers over the next 5 years? (See product answers). How do our suppliers see us? (You may want to involve suppliers directly in this process.) How can we be better customers for our suppliers? What resources can our suppliers provide us that we are not presently utilizing? What weaknesses do our present suppliers have that could negatively impact us?
Competitors: Who are our top five competitors presently? What is each competitor’s strengths and weaknesses? Who will be our top competitors 5 years from now? What presently makes us unique and different from our competitors? In what areas do our competitors presently excel beyond our performance or capabilities?
Internal Systems: What are our system strengths? What are our system weaknesses? Do our present business systems ensure our viability 5 years from now? What changes would need to occur in our present systems to support our products and marketing 5 years from now? Are we spending our money on the right things? How are we measuring our system effectiveness? How should we measure system effectiveness? Do we have the right people doing the right work? If no, explain. Are our employees satisfied with their jobs? If no, explain. In what areas could our internal communication be improved? How could our management improve its depth, expertise and effectiveness?
Once each individual on the team has completed these questions, compile all of the answers into one document. This document should be published and distributed to each team member.
The action plan should always include the action item, steps to completion, the task finish date, and the person responsible for ultimate execution of each step. As the company proceeds with execution, keep the team informed about the progresses. Although you want smooth seamless execution, remember that Rome wasn’t built in a day! Do regular monthly or quarterly checkups with the team as time goes by. If you are diligent enough to complete all your steps, start another plan!
As you proceed remember it’s not always the destination that counts, it’s the journey!
Meridian Associates has been partnering with family-owned businesses for over 30 years to remove barriers, accelerate business growth, build their legacy, and reduce stress levels. With three, high-impact business events each year, The CEO Exchange, Women in Family Business, and The Family Business Intensive, we continually provide best practices & proven strategies that keep multigenerational businesses thriving. Discover how Meridian can help your business thrive through our combination of high impact business coaching, advisory, M&A, and precision company valuations by visiting www.askmeridian.com or calling us at 817-594-0546.
