There are many demands on the time of a business owner - so many demands that often a day, a month, or a year can go by and the important projects that were stamped as "critical" never get done. Once you realize that you have to do something to make progress towards implementing your business plan and growing your business - how do you know what to work on first?
First vision, then mission - now strategies
As was discussed in previous articles, to build a successful business plan you need to have a Vision (know what you are building) and a Mission (know why you exist as a company). Then the question needs to be answered as to how you will reach your vision. What do you need to be working on to make your business successful? To have specific strategies for those areas that are key to your success will provide you with the guidance you need.
Your strategies will be broad, idealistic statements that are unique to you in application, but are fairly common in your industry. So, effective implementation is how you differentiate yourself from those companies who continue to struggle with their business model. You need to properly assess how effective you are at each strategy and then identify the appropriate action plans that will allow you to make progress in implementing your plan.
You likely have strategies concerning marketing, employees, customer service, product quality, sales, pricing, technology, etc. etc. - the list is long as you identify the various areas that it takes to run a business properly. However, if you do not first prioritize your most critical strategies, and then identify the guidelines and direction for each of them, how will your employees be able to make the right decisions when faced with the complexity of implementing your strategies?
The One Page Business Plan by Jim Horan identifies a simple formula for developing a strategy statement - identify your business building activity or goal and then how it will be done. You will find the process to identify the area in which you should have strategic focus is relatively easy. However, clearly explaining it in one sentence is much more difficult - but it is worth the effort! The benefit for you and your employees to clearly identify where the company should focus is that it will allow each step of the way to have purpose in moving toward fulfilling your vision.
Are you making the grade?
Once you have developed your strategies, you will find that they are often idealistic - either they are the recognized industry standard or perhaps they will identify how you always envisioned your company operating. A simple grading process (A,B,C,D,F) as to the quality of your implementation will help you to quickly identify those strategies where the need for improvement lies. If the area is so important, why would the grades be so low on some - or all - of the strategies?
If you have the right people in the right position and you have set them up for success, then you also have the right to expect that progress is being made towards a high level of execution on the company's strategies. An effective exercise is to have each of your managers give their opinion of the grades they would give for the quality of implementation and then share openly in a group setting. This will provide for a great discussion to clarify the meaning of the strategy and to perhaps introduce the fact that there is a lack of consensus on the state of performance. In either case, the communication that occurs will make your company stronger and each person will see more purpose in the activities that take place each day.
Unless you have "A" level players doing "A" level work on your strategies, you will not be making the progress toward your vision that your company is probably capable of reaching. It is a company owner's or manager's responsibility to make sure that your strategies are in alignment with your vision and mission, that they are properly communicated and understood by employees, and then are effectively implemented.
Arnie Hendricks is a financial management and business planning consultant with a focus on helping his clients increase profitability and build value. He can be reached at firstname.lastname@example.org.