If you’re ready to implement an effective strategic planning process in your company to improve business performance, this ultimate step by step guide to annual and quarterly strategic planning will help you skyrocket business growth, and make strategic planning super simple with 5 key strategic planning process steps to help you make the most of the next 12 months.
Strategic planning is one of the best activities to help you hit your business growth goals because it allows you to intentionally align your resources (time, energy, money, team) with the vision you’re working toward. Unfortunately, most CEOs either aren’t doing it because they don’t know how, or they’re doing it in a way that doesn’t work for them and aren’t experiencing the immense benefits of strategic planning. There’s not doubt that strategic planning can feel confusing if you’ve never done it before, if you’ve done it in a way that hasn’t worked, or if you’ve researched so many different tools and approaches to the process that you don’t know where to start or how to make strategic planning effective in your business. But now is the time to figure it out because strategic planning is the most important thing you can do annually and quarterly to grow your business. I’m here to simplify strategic planning process steps for you by providing you with a step by step guide to strategic planning, complete with the exact 5 strategic planning process steps you need, to align your resources with your vision and hit your biggest business growth goals this year. If you’re ready to make the most out of the next 12 months, and you’re craving the clarity that comes with having a crystal clear roadmap to achieving your goals, you’re in the right spot.
I’ve been working with entrepreneurs across various industries with businesses of all different sizes for the last 6 years, and the strategic planning process was one of the key drivers of their growth and success.
What is strategic planning & why are these strategic planning process steps important for small businesses?
Executing on a clear and effective strategic plan allows you to hit your business growth goals with ease.
An effective strategic planning process can help you clarify where you’re going, nuance the actions that matter from those that don’t, and establish a solid strategy for achieving your business goals.
It’s important to follow effective strategic planning process steps so that you can create a strategic plan that actually works for you.
When you’re starting a business because there are so many directions you could take your business in. The opportunities are endless and can create a lot of distraction and decision fatigue when you haven’t narrowed down your focus.
Having a clear vision allows you to work on the right things so that you end up where you want to go.
It allows you to identify opportunities that could scale your revenue and impact further, and pinpoint weaknesses that need to be addressed in order to get to the next level.
Walking your team through the right strategic planning process steps allows them to get aligned with your vision and direction. It creates a growth-focused culture of continuous improvement. And it ensures that everyone on the boat is paddling in the same direction.
After following these strategic planning process steps, you’re better able to filter distractions in your business that don’t move you closer to your goals. Instead, you’re able to prioritize the key drivers of your success and experience business growth at a faster rate with less effort.
If you have an established multi-million dollar business, a brand new baby business, or you’re just thinking of starting a business, creating a strategic plan will allow you to achieve your goals more effectively than winging it…
This article will walk you through the key strategic planning process steps to help you create a strategic plan for your business so that you can feel crystal clear on where to focus & confident that your efforts will yield massive results.
And don’t worry, I will break it down for you so that you don’t need an MBA or 37 cups of coffee to get through a pile of dry material.
Once you learn this easy step by step strategic planning process, you will realize strategic planning is not only effective, but can also be fun, and you’ll be able to execute it quarter after quarter, year after year, with your team.
What are the right strategic planning process steps for a small business?
In this article, I will teach you a simple process for creating a strategic plan that will allow you to improve business performance and create bigger results over the next 3-12 months.
This strategic planning process has been used with small, medium, and large companies all over the country. It’s been used with non profit organizations and different sectors of government.
The companies I’ve worked with pay thousands of dollars to learn and implement this in their businesses because it works. And it works for everyone. Luckily for you, you’re getting all of this content for free! So let’s dig in.
If you’d like to continue receiving valuable free content to help you achieve more in life and business, join our email community below.
Strategic Planning Process Step One: Clarify your vision, your value proposition, and your financial model
Without a clear understanding of what you’re passionate about, what you’re good at, and what brings in money, you will fail to make the kind of traction you need to create a THRIVING business.
The following “hedgehog concept” is based on Jim Collins’ book Good to Great, where he identifies the biggest difference between companies that are “good enough” vs those who are truly exceptional.
First, you need to ask yourself “what am I deeply passionate about?”
The things that light a fire in your heart are the ones that you will be inherently motivated to work toward.
When the vision for your business is aligned with your interests as a person, your success will be unprecedented. It is so important to nail this part down.
In my coaching business, I am deeply passionate about helping ambitious entrepreneurs achieve seemingly impossible goals so that they can lead thriving businesses and live fulfilling lives. What is it for you?
Next, you need to ask yourself “what can I be the best in the world at?”
Understanding what differentiates you from the competition is crucial in getting your ideal audience to understand why they need you/your product/your service.
When you’re clear on your value proposition (what makes you different) you can focus on providing unique value to your clients.
In my industry, I am exceptional at helping high level CEOs get out of their own way and create bigger and better results in their businesses while living more fulfilling lives. What are you great at?
Finally, you need to ask yourself “what drives my economic engine?”
What generates consistent cash flow in your business? What will people pay for? What’s the most important measure of your financial success?
In my coaching business, 1:1 coaching calls drive my economic engine, and other contributors are sales from group coaching programs, online courses, public speaking engagements, published writing, and strategic business planning workshops. The key driver of my economic engine is # client calls per week.
Knowing this allows me to prioritize actions that lead to an increase in this key metric, which creates the financial success that is required to keep my business going strong.
What metric drives your economic engine?
Once you’ve identified the possible answers for all three questions, look for the overlap.
Your core business should fall right in the middle of those three things: it should be something you’re deeply passionate about, exceptionally good at, and will get paid for.
And don’t wait for a big a-ha! moment. Most often, your hedgehog is something you’ve always been aware of, it just needed to be articulated clearly.
[The hedgehog concept] had none of the tiresome, irritating blasts of mindless bravado …“Yep, we could be the best at that” was stated as the recognition of a fact, no more startling than observing that the sky is blue or the grass is green. When you get your Hedgehog Concept right, it has the quiet ping of truth, like a single, clear, perfectly struck note hanging in the air in the hushed silence of a full auditorium at the end of a quiet movement of a Mozart piano concerto. There is no need to say much of anything; the quiet truth speaks for itself.JIM COLLINS
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Strategic Planning Process Step Two: SWOT Analysis
A SWOT (strengths, weaknesses, opportunities, and threats) analysis is simply a process that helps you get really clear on what you’re good at and what you need to improve.
Strengths are internal.
- What are you particularly good at?
- What are your business’ strongest points?
- How are you crushing the competition?
- What do you receive rave reviews about?
- What do you feel confident in?
As an example, holding insanely valuable breakthrough calls for entrepreneurs that want an experienced life and business success coach to support them through a specific challenge in their business is one of my strengths. (You can schedule your free breakthrough call here!)
Opportunities are external.
- What opportunities could you capitalize on?
- What’s going on in the outside world that could benefit your business if approached strategically?
- Who do you know that could help you with a certain thing?
- What exists that you haven’t taken advantage of yet?
A big opportunity for my business this year was the rise of people looking to change their careers after the pandemic helped them realize they weren’t happy with their jobs. My 1:1 Purpose Coaching Program emerged as a way to support them in pinpointing what they really want to be doing with their life and making it happen.
Weaknesses are internal.
- What are you not great at?
- What needs to be improved in your business?
Think through all the areas like your financials, your customer interactions/reviews, your processes (marketing, selling, brand, innovation, producing, servicing, creating content, customer experience, training, hiring, tech systems, etc.).
Threats are external.
- What is happening in the world that could threaten the stability of your business?
- What is the competition doing that could take you down?
- Are you exposing yourself to any legal, financial, or regulatory risks?
The SWOT analysis doesn’t take very long, and is essential for getting a bird’s eye view of the landscape of your business. From there, you can create strategic focus. You can pick the right things to work on that will give you the best results because you’ve thought through all of the factors (internal and external) that will help or hinder your business.
Strategic Planning Process Step Three: Create A Strategy Map
A strategy map is a tool that helps you understand how all of the different parts of your business funnel into one big goal (your vision). It is important because it allows you to make massive progress toward one goal, rather than moving an inch at a time toward many goals.
How do I create a strategy map for my business?
There are 3 key components to creating a strategy map for your business: identifying the areas of your business, selecting initiatives to focus on this year, and confirming that they align to one big vision.
First, you need to define the areas of your business. This is usually pretty standard, but you can definitely tweak it as needed.
There is a financial line, a customer line, a process line, and a leadership/learning line.
Then, you need to decide the areas that are most important for you to improve (usually within a 90 day time frame, but can also be done on an annual basis).
For example, your big financial goal could center around
Your customer goal could center around
- Repeat buying: are your people coming back for more of your product/service?
- Referrals: are your customers saying great things about you and sending their friends over?
- Reviews: are your customers happy with your service?
- New customers: do you have enough new business coming in?
Your process goal could center around
- Brand: how well do people know you and do they think highly of your brand?
- Marketing & Sales: how well do you attract your ideal audience and motivate them to purchase your product/service?
- Innovation: how current are your products and are you coming up with new ideas? Do you have enough revenue streams in your suite of offerings?
- Production/Service Delivery: how well are your current products/services performing? Are you delivering value effectively?
- Customer Satisfaction: how happy are your customers with the service they are receiving?
- Team: how productive & effective is my team?
Your leadership/learning goal can be around any skill set that you need to improve in order to be better positioned to achieve your business goals.
A step by step example of strategic planning
Julie’s coaching business is doing well, but she’d like to grow it. She decides to focus on revenue as her financial goal: “maximize revenue”. In order to do that, she really needs more customers coming in the door. The ones she has are loving their service, giving rave reviews, and referring their friends, but she doesn’t have enough new business coming in. In her customer line, she decides to focus on “new customers knocking at my door.” In order to do that, she needs to focus on marketing and sales. She chose this because she knows her current services are fantastic (don’t need to improve her production/service delivery process), and doesn’t feel like it’s the right time to come up with more service offerings (don’t need to innovate), when there isn’t enough business coming in. So she makes her process goal “create an effective marketing funnel”. Finally, she realizes she has no background in marketing/sales and needs to improve her skill set. Her learning goal becomes “understand marketing/sales psychology.”
Here’s what Julie’s strategy map looks like:
- Financial: maximize revenue
- Customer: increase new customers
- Process: improve marketing effectiveness
- Learning: increase knowledge of marketing/sales psychology
These are general goals, but they begin to lay the foundation for her strategic plan.
The last step in creating a strategy map is ensuring it all funnels toward your one big vision.
To do this, read your map from the bottom up.
Julie, from the example above, would say “I am going to increase my knowledge of marketing/sales psychology, so that I can improve the effectiveness of my marketing process, so that I can increase the number of new customers I serve, so that I can drive up revenue… so that I can hit my vision of $1,000,000 in 10 years.”
Framing your strategic plan in this way allows you to see exactly how the projects you’re spending your time and money on are contributing to your growth goals. It helps align your team with your vision and mitigate distractions in your business as well.
Strategic Planning Process Step 4: Close The Gap
Now that you’ve laid the general foundation of areas to improve in the next 90 days (or 12 months if you’re doing this annually), it’s time to get more specific in what that could look like.
Think about where you are now, and where you want to be in 90 days (or 12 months), for each business area that you chose to improve above.
Revenue improvement examples
- From $1,000/month to $3,000/month
- From inconsistent revenue to consistent revenue
Bringing in new business examples
- From 1 new client/month to 3 new clients/month
- From 5 discovery calls/month to 15 discovery calls/month
Marketing improvement examples
- From people having no idea what I do to people knocking on my door
- From 200 email list subscribers to 500 email list subscribers
- From inconsistently marketing myself to having a clear strategy that works
- From having no idea what marketing is to feeling confident in my marketing abilities
- From not knowing whether I’m tax planning correctly to following an established tax planning process
- From not creating time for personal growth to spending 1 hour each day learning
Having your “gap” laid out like this allows you to get really clear on where you are today, and where you would like to end up.
With that kind of clarity, you can create your action plan with ease.
Once you’ve created the gap, brainstorm HOW you could achieve these goals. This doesn’t need to be complicated, just get down on paper everything you could do to close the gap you’ve identified. Do you need to take a course? Get a coach? Rework your routine? Research something? Lay out a plan? Meet someone for coffee?
Brainstorming various ideas without censoring yourself will give you a pool of options to choose from when we finally pull together your business action plan in the final step of this process!
After you brainstorm, make sure you prioritize the most effective actions to move you toward your goals. Don’t try to squeeze everything into one quarter, or one year, be focused in where you’re dedicating your time and energy.
Strategic Planning Process Step 5: Create Action Plan
A business action plan ties together the various pieces of your strategic planning process steps into a clear and actionable plan that you can start working towards immediately.
If we continue using Julie’s example, her business action plan would look like this.
|Strategic Area||Objective||Timeline||Measure||Actions||Owner/Due Date|
|Revenue||$3,000/month consistent revenue||August 31||$/month|
% months hitting target
|Create payment plan option to increase consistency||Julie by May 30|
|Customers||3 new clients / month||August 31||# new clients onboarded|
# discovery calls held
|Improve discovery call structure to increase conversion|
Launch a free discovery call campaign
|Julie by June 15|
Kate by June 30
|Marketing||500 email list subscribers||July 31||# subscribers|
% posts with CTA to subscribe
|Create sales funnel|
Improve call to action on website
|Kate by June 20|
Julie by July 1
|Learning||Completed 1 course||June 30||hours/week spent on course work||Purchase a marketing course||Julie by June 1|
How Do I Create A Strategic Plan of Action for my Business?
Start with the strategic business area you chose to improve this quarter/year in the previous step.
Nail down the exact objective you are working toward
Ensure it is
- Specific, as in you know exactly what you’re aiming for and there is 0 tolerance for vagueness
- Measurable, by assigning a number to it
- Actionable, as in you are able to influence the outcome
- Realistic, when you consider your other commitments
- Timebound, assign a deadline in the “timeline” column
Decide what measures are important to track
You want a measure that directly reflects your objective (so if it’s increasing revenue/month, then you want to track $ revenue/month). This is a lagging indicator.
You also want 1-2 leading indicators. Leading indicators are secondary measures that impact your primary measure.
For example, if your primary measure is revenue, then your secondary measure might be # of sales calls made. The more sales calls you make, the more likely your revenue is to go up.
It’s useless to track only revenue, because you aren’t creating visibility to your efforts and how they’re impacting your results.
Determine the actions you (or your team) will take to achieve this strategic improvement over the specified timeline
You brainstormed a few options in the previous step, now determine which ones will yield the highest return with the least amount of effort. Which actions make sense to take on first?
Finally, assign a deadline and an owner to each action. Who is responsible for getting it done and by when?
A strategic plan for your business creates the focus you need to achieve bigger and better results.
Putting in maximum effort without taking the time to step back and consider your objectives creates burnout with very little to show for it.
When you follow these strategic planning process steps to improve your business performance, success becomes an easy, repeatable habit.
I know this process has worked time and time again for the high level CEOs and aspiring entrepreneurs that I coach on a weekly basis. My clients are hitting big financial goals, and doing it with less work and more energy than ever before, because we take the time to get clear on their strategic plan and they reap the benefits of our regular coaching calls week after week.
I hope these strategic planning process steps work well for you in helping you not only identify where you’re heading and what you’ll do to get there, but also in getting excited about this journey you’re on and the incredible business you are building.
If you want to bulletproof your strategy, I’ve created the best business coaching program for you. I’d love to work with you one on one to identify the exact results you’re aiming for and the key actions that will generate the success you’re craving.
Join the world’s most ambitious entrepreneurs in accomplishing “impossible” goals today.
What goals are you working toward in your business this year? Let us know in the comments below!
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