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Strategic Planning

 A Strategic Plan is like a treasure hunt, and the treasure is an un-served or under-served market segment that your business is structured to serve.  The Strategic Planning process is far less constrained by the business' present capacity; it explores beyond what the business could do today to any activity its structure could support. The key focus of the Strategic Plan is opportunity. Good market research is the key to good strategic planning.

 A Strategic Plan is primarily focused outward. It seeks to identify and quantify what market opportunities the business could serve with its present structure, even if the current capacities would need adjustment.  The most important inside consideration is a thorough understanding of the business’ structure, and what other markets might be served with it.

 The Strategic Planning Process 

  1. Inventory of the business' resources and capacities.
  2. The entrepreneur has a vision and interests may help uncover additional market areas where the principal has knowledge.
  3. Conduct market research to identify un-served and under-served market segments that the business could fill with reasonable and timely changes to its organization.
  4. Conduct sufficient industry research and financial analysis to evaluate the potential for the various markets identified by the market research to impact the business' financial performance.
  5. Select opportunity(ies) that fit best with the current business, and develop a Business Plan to implement the strategy.

 The Document

The strategic portion of the plan includes an inventory of the business' physical, intellectual, human and financial resources. Often one or more focus groups is used to identify perceived needs for goods and services that then target the research. The best candidate markets are then analyzed and the best fit(s) are selected to be included in the Business Plan. The Business Plan portion analyzes three years of historic financial data and key financial ratios, with a comparison to industry norms and top performers. It defines and analyzes the market served and the new market(s) to be served, and the competitive structure of the market(s). The Plan delineates the issues and opportunities the business faces; and the Goals, Strategies, Tactics, and Action Plans adopted to improve market share and efficiency. Finally, it estimates three years' financial performance for that scenario over a range of market conditions (with special attention to cash flow requirements during the expansion).

 

 
 

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