As another year comes to a close, business owners will be busy poring through financial statements to determine the extent to which they need to do tax planning. They may also be busy working up forecasts and budgets for 2013. Too often a disproportionate amount of attention is given to the tax situation. Forecasting and budgeting becomes nothing more than a formality with growth estimates being nothing more than figures plucked out of the air – e.g., an across the board 5 – 10 % increase.
How many businesses build budgets based upon the development and implementation of strategy? Far too few I’m afraid. Few are taking the time to identify the actions that will support a 10% growth in sales. Too many have a strategy of “hope” – let’s hope that the sales appear.
Success in any business requires a strong plan to drive growth – a plan of action for the next 12 months or longer. The plan should encompass the following:
1. Identification of your Sustainable Competitive Advantage (SCA) and how you intend to leverage it.
2. Completion of a Strategic SWOT Analysis (i.e., strengths, weaknesses, opportunities and threats) to help create a list of actions to capitalize on your greatest opportunities and strategically drive growth.
3. Analysis of the marketing, capital and personnel requirements to fund the estimated growth.
4. An accountability process to insure that your great ideas get implemented.
Having a revenue model that is linked to specific actions in your strategic plan is the best alternative to a strategy of hope. A well defined strategic plan that is backed up by sound research is the surest way to drive growth and profits in your company.
How about you? Is your business strategy a strategy of hope? Make it a goal to get started on a strategic plan for your business today!
Want some help getting started? Click here to download a Strategic SWOT template.docs/swot template.pdf