Strategy in business is important. Right?
It forms the foundation of all that we, as business owners, build our enterprises upon.
Strategy helps us define our business, gives it a set of values, gives it purpose and helps us understand what success actually looks like. It provides a roadmap for our business, shows us our destination and identifies useful stopping points along the way.
After all, who would set off on a journey without having some idea of where they were heading or how they would get there?
It’s surprising then that, according to a recent survey conducted by Barclays, a staggering 47% of small business owners have no formal strategy in place to support their business growth. Of that total, 25% have an informal, verbal business plan, whilst 23% have no plan whatsoever.
Virtually every business owner I have met has some kind of vision for their business in their head – but it is often unstated, almost sub-conscious. Nevertheless, that core belief drives them to growth and achievement. In the early days this, along with boundless energy, enthusiasm and hard work, can be enough to deliver some initial success. As time goes by and the business gets busier, many owners find that they simply don’t have the time to step back from the day-to-day to think about strategy. Planning becomes a luxury that they can’t afford.
The problem becomes compounded if sales dip, costs rise or competition bites. The business starts to suffer. Time, that most precious of commodities, gets harder to spare. Every free moment is spent putting out fires. Many business owners come to feel like they’re on a ship without a rudder, being blown by the winds of fortune, with no control over where they might land.
This can all be avoided.
Most successful business owners that I have come across are successful precisely because they have spent some time out of their business, thinking about strategy and developing a formal action plan. They understand their values and the purpose of their business in their customers’ eyes. They have a set of financial targets that they strive to achieve and they understand the means needed to achieve them. They know what risks they might be facing and they have a plan to minimise them – or even turn them into opportunities. Most of all, they understand their unique point of difference; the thing that gives them a sustainable competitive edge, the thing that makes them truly valuable to their core customer base. Because they know that, they know who their most valuable customers are and they know how to reach them.
Creating a strategy is not difficult but it does take a little time and focus to get right. And that’s not easy when you’re busy running a business. After all, when urgent meets important, urgent usually wins. I always advise business owners to try and make some time to step out of their business and think about what they really want to get from it.
Making that time is the first step. I have never come across a business owner that has regretted taking it.
Next comes the planning itself. This can be daunting, but it’s easier if you break it down into bite-sized chunks. I find the best approach is to divide the process into 10 simple step and to work through them methodically. They are:
And remember, a strategy isn’t just an obscure document that sits on a shelf in the office, gathering dust. It’s a living, breathing embodiment of your business. It should be visible, inspiring, feasible, time-specific, measurable and, above all, flexible and fun. You should use it every day, share it with your team, build on it as your business develops and use it as your guide to success.