It is easy and effective to plan well in small business. Planning doesn’t take a lot of effort, it shouldn’t take a lot of time, and the best part: it’s free. Use these 3 simple steps to get an advantage over the competition.
1. Mission and Objective
What is the overall purpose for your business? Your answer should be detailed, specific, meaningful and measurable. To say “make a lot of money” is not an objective. To say “consistently exploit advantage X to create Y amount of value by date Z” is better. A good objective will be realistic, but ambitious. It will focus your attention and push you to take reasonable risks. It specifically defines what “success” looks like. Although the world of small business is constantly changing, with new opportunities and new threats all the time, your mission should provide a solid, consistent framework. Within that framework, you will plan, strategize, innovate and execute in a changing marketplace.
2. Strategy
How will you attain your objective? What fundamental rules or method will you use? That is your strategy. Strategy is a long term approach that underlies all of your short term actions, in the service of your objective or mission. A good strategy, like a good objective, will be detailed. It should be detailed enough to provide answers to a variety of important questions that you will encounter, but general enough to change occasionally. What major tools, methodology or resources will help to achieve your goal? What kinds of advantages, characteristics or unique qualities will allow you to outpace the competition? Answer those questions, and you will have the beginnings of an effective strategy.
3. Tactics
Tactics are the short term, day-to-day and week-to-week measures taken to support the strategy. Good tactical decisions allow you to compete more effectively. Tactics arise from two types of sources–internal and external. Internally-derived tactics come from new initiatives and new projects that you think will help to further your strategy. Externally-motivated tactics are responses to short term changes in the marketplace, in the overall economy, feedback from customers or new moves by competitors. Success requires flexibility. Flexibility is what good tactical decisions are all about. Only by staying flexible and responsive to both internal and external developments can a small business successfully further its strategy and obtain its objectives.
