Your Business Next Year - Strategic Planning

The quiet time at the end of the year is a good time to evaluate what your business has accomplished during the past year and what you want to do in the coming year. You can do this kind of evaluation in a structured, organized way based on what effects your past decisions have had, what consequences you can draw and what decisions you have to make now to achieve your goals for next year. This process is your strategy - hence strategic planning. (Non-strategic planning: "I've got too much work so I have to hire more people."; Strategic planning: "Last year our business volume doubled but our profit is only a little bit higher. I don't need more people. We have to reduce our production costs.")

In 1993, President Clinton initiated a government performance review with the goal of using strategic planning to re-focus government departments on providing the services that citizens want. Here is the document. Even if you only get as far as the executive summary, it is well worth reading if you want to do the kind of evaluation and planning discussed above. The document covers several key points which are important for strategic planning, whether it is for government or for business:

1. Customer feedback - you have to ask your customers what they want.

2. You plan first, then decide - this is especially true of budget decisions.

3. You have to be aware of your basic corporate ideology and stick to it - what is your priority: customers, employees, profit, product. One is not necessarily better than the other but make your decision and stick to it.

4. Measurement - planning is useless unless you build in benchmarks which let you measure your progress. You have to know at all times how far you've come and how far away your goals are.

Most small businesses suffer from lack of planning and even more suffer from an absence of strategic planning. The government document link above gives you free access to the kind of information, examples and advice you'd normally have to pay thousands for. Have a happy planned holiday. Strategically.

For a more in-depth discussion of this subject try the "Growing Your Own Small Business" course at Suite University.

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