Tag Archives: success

The Strategic Plan

The strategic plan provides the basic focus and guidelines that drive the business planning process. It covers a multi-year period and provides a long-term perspective for your business and furnishes the business with a decision support framework to be used year around.

Strategic Planning

Strategic planning is a fundamental requirement of any successful business. It establishes and communicates direction and vision for the organization to follow, and allows management to respond to unexpected opportunities in your market place.

Although no plan can detail every step along your future path, your plan can provide clear direction for the planning period. You should identify two or three strategic initiatives for the planning period. Success with these will enable you to achieve your business goals. To support your strategic plan, you will need a plan (operating plan) that describes how you intend to support the initiatives over the next 12 to 18 months.

Small businesses are not scale models of big businesses; they are characterized by resource poverty and dependence on a fairly localized market. Their greater vulnerability to the consequences of a lack of focus stresses the importance of their strategic plan.

Critical Success Factors

Before we begin a Strategic Plan we should examine our objectives for the plan. Here is a set of suggested factors that are critical for success:

  1. Developing a market-oriented customer focus.
  2. Improving productivity at all level of your business.
  3. Staying focused, following your plan, and re-evaluating your plan, as needed, to meet the changes in your business environment.
  4. Staying close to your customers.
  5. Maintaining recognition as a “Marker Leader” in your target market.
  6. Providing a strategic vision and tactical focus that enable each team member to clarify their role in contributing to achieving your plan.
  7. Valuing and supporting an environment that encourages and rewards risk taking, maintains high ethics, and supports personal development.
  8. Having a plan for managing accelerated changes to ensure orderly business operations are maintained.
  9. Striving for excellence in all aspects of your business.

Developing the plan

The strategic plan defines the company’s “competitive edge,” that collection of factors that sets the business apart from its competitors and promotes its chances for success. It requires a clear evaluation of the competitive business climate and an intimate knowledge of the market for the entrepreneur’s product.

The foundation for the strategic plan is a clear mission statement for the venture. Addressing the following questions can assist in developing this statement:

What business am I in? The answer to this question is not as simple as it seems. A good example of an industry group that failed to take a broader view is the railroads. If they had viewed their business as transportation rather than trains-and-tracks, then the airlines would be named Union Pacific and Illinois Central.

Who is our service intended to satisfy? What customer needs are being satisfied? How are these needs being satisfied, that is, by which of our methods or products?

An important strategic option is in how we price our product (as a price leader, value leader, or prestige product). Another choice can be the particular “niche,” or subset of the market, we seek to serve.

Once we have set internal objectives, we must examine the external and competitive environments in which we will be trying to achieve them.

The external environment consists of those factors that are largely outside our control, but affect the market for our product. Examples of these factors include general economic conditions, regulations, technological developments, and consumer demographics and attitudes. This environment is very dynamic, but some attempt must be made at projecting its changes.

Analysis of the competitive environment must begin with consideration of whether there are any barriers to entry of a new competitor into the market. How strong is consumer loyalty to existing brands? How important are economies of scale; can a small independent firm compete?

Barriers to entry include: Are capital requirements prohibitive? Is there some proprietary technology that puts prospective entrants in a serious competitive disadvantage? Is access to some materials or to distribution channels limited in some way? Are new entrants limited by permit restrictions or regulations?

The competitive structure of the industry is another important consideration. Are there a few dominant firms, or is the industry fairly fragmented? Will current competitors attempt to “punish” new entrants, such as through a price war, heavy advertising, or exercising their clout with key suppliers? Is there some geographic niche we can serve? What factors create cost advantages or disadvantages? How important is a firm’s position on the learning and experience curves? How are prices set? Is demand rising, even, or falling? Are there exit barriers that raise the risk of entry?

Can buyers perform the services themselves? Do they have a wide choice of vendors? Are there less expensive or superior substitutes to our service in some segments of the market?

These are certainly not easy questions to answer, but performing the research to make better informed decisions, and addressing these questions “head-on” can improve our chances of success.

Resources

Within the briefs format all we can provide is an overview. For detailed information see:

Free Management Library

http://managementhelp.org/fp_progs/sp_mod/str_plan.htm

The Strategic Planning Process

http://www.quickmba.com/strategy/strategic-planning/

If you would like to request a Cincinnati SCORE Mentor to assist with your planning please click here.

 

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10 Characteristics of a Successful Entrepreneur

10 characteristics to being a successful entrepreneurBeing an entrepreneur is harder than it sounds. Being the boss may sound like the best job in the world, and it is; However a 60+ hour work week, with the buck stopping at you for EVERYTHING can loose its charm pretty quickly. So to help you navigate these tough waters, we’ve created a list of 10 characteristics to being a successful entrepreneur.

1. Write a Business Plan- Think of it as a road map to success, complete with stops along the way like organization, product/service viability, marketing, advertising, service area, profit & loss analysis, and breakeven point.

2. Be organic- Be You and make it into a niche market. Consumers are often attracted to the more “authentic” sellers. Be proud of the characteristics that distinguish you from your competition. Do it better, say it better, sell it better.

3.Be Resilient & Flexible- These 2 points are KEY characteristics to small business success! Entrepreneurs must Bounce back from failure, and take rejection. If there is a common critique, a true entrepreneur takes this constructive criticism, and can turn it into a stronger selling point for their company.

4. Be the Expert- Get smart on what works . Your business is a reflection of yourself; know everything you can about your business. Consumers want answers, especially if it is in a new field.

5. Ask for help- Being the boss can be tricky, and you are responsible for all assets of your business. But that doesn’t mean that you should know everything in the world. No one is perfect; ask for help, find a business mentor, coach, or friend and use them to find a solution to an issue your struggling with.

6. Management skills- Be prepared to wear a lot of hats. As an entrepreneur, you will manage accounts, control costs, customers, inventory, and employees. Remember, attitude reflects leadership, motivate employees and you’ll have happier customers.

7. Equity & Control- Money is key to any business, but how do you get it? The most common route is through the bank, most banks want to see that you are ponying up some of the dough. This proves to them that you have a vested interest in the success of the business.

8. Drive to work- on average, startup entrepreneurs pull 60 hours a week, to add insult to injury, 9 in 10 business fail within the first 5 years. In order to succeed you have to work for it, work towards a stride, tap your drive, and set goals.

9.Passion for success- In order to succeed in business, you must be passionate about what your doing. Set your passion on fire and temper it with goals, resilience, and drive.

10. Be honest- Take time to valuate what’s working. Examine the sacrifices you’re making; are they short term and for the greater good or have they become something else.

Do you have a characteristic that you would add? If so share it in the comments.

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