Developing a Strategic and Tactical Plan
How do you climb Mount Everest? One step at a time. The trick, of course, is to know what steps to take, and in what order to take them. This article details an approach to developing a strategic and tactical business plan.
Finish the Past
The first step in creating a strategic plan is to review and complete the previous past period, or year. You must “finish” the past for two reasons: (1) to learn everything possible from your previous actions, results, and mistakes, and (2) so that what ever is left over, whatever issues are hanging over your head, are no longer a burden.
Answer the following questions:
- What did you set out to accomplish?
- What intentions did you really take action on, and which ones did you merely talk about?
- Specifically, what did you actually accomplish?
- How effective were you?
- What percentage of your goals were realized?
- What did you accomplish that you didn’t intend to?
- What were the unintended side effects?
- In your opinion, what did you do “wrong”?
- What did you simply skip?
Set Priorities
 |
Download this Past Year History worksheet and write a detailed, objective history of the past year. Document the year’s events and results in journal form from your date book and your sales ledgers, and then get ready to move forward without dragging the past with you. |
Using your values, beliefs, vision and strategy as a guide – establish priority issues for the coming year. Presuming your resources are limited, you may not be able to impact all areas of the business at once. Take a look at the following list. In which of these areas do you most want to make a difference?
Add other areas which are relevant to your business. Then choose which you will focus your attention on. Once you have decided which areas you will focus your efforts on (and also which will not receive much attention), establish goals, or measures for success. The standard approach to establishing measures for success is to figure out what is practical. “We did X last year, now we’ll do X plus 10%.”
The catch is, this approach will get you average results. And while there’s certainly nothing wrong with average results, you have to step outside your normal confines to get extraordinary. Consider what will move you towards rapid realization.
Establish Measures and Goals
Establish a clear set of measures for each area of focus with this Goals Worksheet. In Product Development, you could add two new products for your target niche. In Customer Satisfaction and Quality, you could reduce incident time by three days, raise your customer satisfaction metrics from a 7.3 to a 9.0, and/or eliminate defects in your final product release. You could Geographically Expand into Canada, Mexico or the Northwest.
Employee retention and Intellectual Capital would be impacted by reducing turnover from 14% to 5%, providing 50% more training days for employees and targeting an increase in patents held from 2 to 5. You could increase Market Penetration, Revenues, and Profits by adding 25% to the customer base, increasing service revenues 100%, and raising your net profit margin to 23%.
Place a time frame on each measure and turn it into a goal. Total customers increased 25% by September 30th is a clear-cut goal. It fits nicely on the end of a timeline.
Initiatives
For each measure within an area, invent one or more initiatives which help you reach your goal. Sometimes the initiatives are relatively simple, such as hiring a salesman for Northwest territory. There may be alternate options, such as contracting with a distributor in lieu of a local sales force. In that case you have to evaluate suitability, costs, resource drain, and the likelihood of success for the various options before committing to one path.
Sometimes achieving the goal will require a series of initiatives, or parallel initiatives. Increasing the customer base 25% may involve direct mail, print and web advertising, two new sales reps, a phone campaign, and working the customer file. Alternatively, it could involve acquiring a competitor, or maybe the competing product line. Each of these initiatives then requires its own measures for success. And each one must be evaluated in terms of suitability, costs, and likelihood of success.
Action Steps, Milestones, and Timelines
When you’ve chosen a suite of initiatives, break each into action steps and intermediate results, and then place the whole thing on a timeline. Include acquisition of missing resources and skills and set regular milestones to keep the whole effort on track.
A big white board or flip chart paper taped to the wall can display your timeline, including measures, milestones, and commitments made by various team members defining what will be accomplished each tracking period. Project management software is also useful for complex initiatives, as it helps you visualize and account for “dependencies.”
The Merlin Method
For some of areas, you may be clueless, meaning you simply have no idea how to achieve results. In this case, you can use the Merlin Method. The Merlin Method can be a very powerful way to generate a set of tactical actions.
Imagine you’re standing at the end of a long timeline. You already achieved your specific goal. Imagine or visualize how did you do it. What actions did you take? What resources did you secure? Who’s help did you enlist? Ask these questions in a stepwise fashion starting from the end. What was the last significant thing you had to do just before reaching a goal? Put that on your timeline. And just before that, what did you have to do? And just before that? And so on, moving closer and closer in time, right up until the present.
External Resources:
1. Strategic Planning: Fundamentals for Small Business
2. Strategic Planning for New & Emerging Businesses
3. A Handbook for Visionaries, Game Changers, and Challengers
