Strategic planning is a critically important part of business growth. If a CEO and senior executive staff don’t look ahead to what the future might hold, there’s little opportunity for growth and expansion. A business can only tread water and hope for the best possible financial outcome.
At the same time, plunging into the strategic planning process without adequate preparation can result in muddle and confusion. Too many attempts at effective planning fall apart, due to mistakes made in the process. Here are five common strategic planning mistakes you should avoid at all costs:
Remember the strategic plan you created for 2022, way back in 2021? It may have worked well for your business, but that doesn’t mean you should simply recycle that plan again in 2023.
Times change, market conditions vary, key personnel come and go. For these and many other reasons, strive to create and adopt a new plan, different in tone and quality from last year’s plan. Certain elements may stay the same but refrain from just adding some new dates to an old plan.
When it comes to effective strategic planning, a laser-like focus on your customer base is the best formula for success. All too often, strategic plans skate over changing customer demands, relying instead on a generic concept of customers.
To enhance effectiveness, closely examine current and projected customer demographics, what you’re doing right (and wrong) with respect to customer retention and look more closely at how you can continue addressing the challenges faced by your customers.
In virtually every field of business, there’s competition for customers. Unfortunately, many strategic plans fail to gauge the effect competition can have on plans for growth. This lack of focus on competitors can result in a strategic plan that exists in a vacuum, without regard for the larger national and/or international markets.
Even if all your competitor analysis data doesn’t go into the plan, those charged with creating it should have a strong understanding of key competitors, where they have expanded or cut back in the previous year, how they communicate to customers, and so on.
Sometimes, the plan that emerges from strategic thinking doesn’t really “add up” in terms of its analysis, description of challenges, and potential solutions. That can happen when a plan is created by committee, or when those involved have neglected to provide continuity and coherence throughout.
Strategic planning experts advise staying away from overly complex wording or convoluted thinking. “Creating a simply strategy by dumbing things down … doesn’t work,” notes Forbes. Instead, “make sure that the strategy is a coherent whole,” with “various chapters and sections of plan” fitting together. Above all else, a strategic plan must make sense.
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Without the support of the organization, how effective can a strategic plan really be? In many cases, notes business author Bernard Marr, plans “are developed by only one person … without engaging critical stakeholders from elsewhere in the company, then simply handed down from the leadership team like a decree from the heavens.” That can result in an absence of understanding or support from within.
Instead, consult with a variety of departments, in order to design a more comprehensive plan. Consensus-building goes a long way towards eventual execution of the plan.
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