All About Business Plan Strategies
Do business owners know why their businesses exist? How quickly does entrepreneurial enthusiasm die because the owner loses sight of why he/she set up the business in the first place?
A business needs a clear and compelling vision for its very existence. It will have a set of values based on the values of the owners, and from the vision and values the company will produce a number of strategies to help set a clear direction for the business in the future.
VisionA vision gives a concise plan of what the business is building into. What will the business look like in one, three or five years time? Who will be the customers? With what products and services? What are the goals of the business? The answers to these questions should be encapsulated in a one or two sentence business vision.
For example: In the next five years grow Mortgage Broker Consultancy Ltd (MBCL) into a local mortgage services company generating revenue of at least £500k per annum. MBCL will provide mortgage services to people in the county of —shire, served by professionals who will help MBCL attain the best standards in the county.
MissionThe mission statement of the company should be a short, punchy summary of the reason for the company to exist, which can be easily understood by your prospective customers.
For example: We help your dream become your home.
ValuesThe vision, mission and the strategies of a business should be based on a set of values of the owner(s). Often, the values of a business are forgotten, or at least they are not written down or published widely. Yet these should be the basis of the ethos of the business.
Your personal values are probably at the base of your business values. Here are some examples:
- Making as much money as possible
- Keeping fit and healthy
- Being environmentally friendly
- Keeping the family happy
- Making a contribution to society
Can your business help you attain those values? There is no reason why a business should not reflect the values of its owners and help them attain and maintain their values.
StrategiesArmed with an understanding of what the business exists for and what values it is based on, the owners can prepare its strategies for the next one, three, five years (whatever period they like). Strategies should have the purpose of making the business successful over the defined period, aiming towards the vision, and keeping the values in mind.
Strategies can be for a number of areas, such as: growth, positioning, products, client acquisition, revenues, staffing, technology, target markets etc. Here are some examples (for various different types of business):
- Grow the business by 50% in two years.
- Focus on prime and commercial mortgage markets.
- Add bedroom furniture to our bespoke home furniture range.
- Attract and retain top quality staff by offering fair salaries, good packages, and a reputation for employee care.
- Use IT to develop a customer relationship management system.
- Reduce the carbon footprint of the business in three years.
- Donate a percentage of pre-tax profits to local charities.
These are a few examples of how the direction of the business can be planned for the next few years. They provide a framework for key decisions and for objectives which will be set. The strategies in themselves are not always clearly measurable (although the first example above is), but should lead to objectives that are.
ObjectivesObjectives are specific, and indeed the best objectives follow the SMART acronym (Specific, Measurable, Achievable, Realistic, Timed). Objectives can be allocated to departments or even individuals are for them to achieve. Here are some examples:
- Increase sales by £50k in 2008 (compared with 2007).
- Add an average of 15 clients per quarter throughout 2008.
- Hire an IT support technician by end of the year.
- Measure the carbon footprint of the company by end of the year.
Vision and values are the blocks upon which a business’s strategies are built. The strategies provide the key direction indicators from which objectives can be drawn up and allocated across the business.