28 Jul 2017
By Lloyd Snowden, Associate at Oliver Wight
For any company, strategic planning is central to swift and reliable decision making. Done well, strategic planning brings shared ownership of the business direction, and its challenges and opportunities, right across the organisation. With this increased ownership comes the improved communication and understanding among all employees that is essential to effective business judgements.
The best companies have an integrated strategic planning process that clearly defines the business direction over five years or more. The principle objective should be to establish and manage the vision, strategy, and direction needed to become a top-performing business and improve the company’s competitive position. So here is the first part of Oliver Wight’s key steps for managing your strategic planning process:
The fundamental first step to planning what type of business you want to be, is to understand what type of business you are. Start by gathering all the relevant information both from inside and outside the company, so you get a firm perspective on your products and services, your competition and future business opportunities. By fully analysing and understanding your market offering, you can properly define your company’s value proposition, play to its strengths and address its weaknesses.
It is also important to have a properly balanced view of the goals and targets of all the company’s major stakeholders, and to examine your products and services portfolio accordingly. Naturally, you can’t be all things to all men (or women) but one thing you can’t compromise on is having the voice of the customer fully reflected in your product strategy.
Research done, you should now be able to create meaningful vision and mission statements; these should be inspiring and memorable, and truly represent the ambitions of the company and its stakeholders. Most importantly they need to be understood and supported by all members of staff. Avoid platitudinous statements such as, “we aspire to provide the highest quality and best customer service in everything we do”; it won’t mean much to anyone.
The leadership team should also capture the business’ core values in a separate value statement. These are the guiding principles needed to be embraced by the entire organisation to develop the right environment to drive and support your strategic plan and supporting programmes.
Once your mission, vision and values are set, it’s time for the leadership team to bring them to life in a strategic plan. You’ll typically need four to six strategic business objectives (SBOs) that will be the driving force for change in the business over the next five to 10 years. They should be simple statements such as ‘Grow the business by 30 per cent in the next five years’. This will make sure there is a mutual awareness of the direction the business is moving in and understanding of how their own roles contribute to success. You’ll also be able to establish a measurements hierarchy to monitor progress.
Though your strategic business objectives may be long-term, it is crucial that they are kept in the present day. People, throughout your entire organisation, must understand the strategic direction of the business to make effective and well-informed decisions today, which will have a positive effect tomorrow. This means you must have clear ‘roadmaps’ and ‘critical success factors’ for all your core processes (products and services, demand, supply and finance) plus the supporting functions (people operations, IT, quality, data and so on) stretching over the five to 10 year period of the strategic plan. These drive long-term business goals into the here and now.
This blog is based on Chapter One of The Oliver Wight Class A Standard for Business Excellence. To read the seventh edition of our essential guide to business improvement, please click here.
Join us next week for Top Tips for Managing the Strategic Planning Process: Part II.