A New Best Practice for Starting and Staying in Business
A common denominator in all of the “how-to” guides I’ve read on starting a business is that of writing a plan. Ironically, this “start a business” best practice is also the best approach to staying in business. Does your business have a plan?
The most common complaint I hear from business owners is, “I’m having trouble growing my business.” My typical response is, “Why do you think your current plan isn’t working?” The typical answer is, “What plan?” I conclude with, “You just identified your problem!” Many of the businesses I meet with, regardless of how long they have been in business, do not have a documented strategic plan to direct their actions and resources. Businesses that have a plan know where to focus and rarely grapple with business decisions. It is a sequential approach we developed called M.O.S.T. (Mission, Objectives, Strategies and Tactics). Once you have a mission, the planning process involves three steps.
Step 1: Develop objectives that articulate accomplishments toward advancing your mission. A well-crafted objective is specific, measurable, realistic and assigned. Example: Increase sales revenue on X product 17% to $3, 875,000 by December 31, 2011, assigned: X Product Manager.
Step 2: Create strategies that define a specific path or initiative designed to accomplish an objective. A well-crafted strategy defines a course to take as all or part of achieving an objective. Example: Establish a new distribution channel to increase Western region sales.
Step 3: Establish tactics to coordinate activities for each strategy. Tactics cover all actions, from group projects to individual tasks, necessary to effectively implement a strategy. They define “who” does “what” by “when” and are based on your available human and financial resources. Example: Interview the top three manufacturer rep companies to determine which has the greatest distribution in the Western region by April 8, 2011, assigned: Marketing Manager.
Each level of planning—objectives, strategies and tactics—are aligned to the planning level above it, e.g. strategies support an objective, and tactics support a strategy. One objective will be supported by one or more strategies, and each strategy will be supported by several tactics (which represent an action or work plan).
It doesn’t matter whether you are starting a new business or trying to grow an existing business, nor does it matter the size or sector of your business; strategic planning is a best practice that should not be overlooked.
Bring your team together and develop objectives, by department or functional area; then brainstorm a set of strategies to accomplish each objective. Finally, have the manager and team in each department develop tactics to create an action plan for each strategy.
Because of the exponential nature of plans, limit the number of objectives you want to accomplish, and keep to a short set of strategies for each. Otherwise, you may end up with too many actions to deal with…in strategic planning, less is more. I suggest you also align the timing of your plan to your fiscal year to make budgeting easier. Use the M.O.S.T. planning process to make what many experience as an arduous undertaking far simpler.
This best practice will increase the likelihood of your success and longevity.
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