If you own or operate a small business, how much time do you spend developing your business strategy ? If you’re like most small business owners, not much.I often hear “I don’t have time to plan, I’m too busy running my business”, or “Everything is so unpredictable these days I don’t see the point.”The truth is that every business needs a strategy; otherwise progress can’t be measured and success never achieved.Building your strategy doesn’t have to be a complicated time consuming exercise; I have developed an approach that results in having your strategy in not more than three days, and you can begin executing it on the fourth.
Growth goals
The process begins with setting your financial goals and deciding
HOW BIG do you want to be? Do you want $1 million in revenue within 24 months or do you want to be more aggressive and go for $5 million?The magnitude of your growth goal determines the character of your strategy: modest goals yield minimal change and a relatively low risk strategy; aggressive goals require more directional change for your business with higher attendant risk.
High potential customers
Second, decide on the customers you want to target by answering
WHO do you want to SERVE? You have a choice here; customers are not all created equal and you need to focus on those who have the potential of satisfying your growth goals and leverage the core competencies of your business.
Competitive strategy
Third, determine your competitive strategy by deciding
HOW do you intend to compete and WIN? This requires that you define your uniqueness versus your competition, and answers the question “Why should I buy from you and not one of your competitors?”.If you can’t give your chosen customers relevant, compelling and unique reasons why they should buy from you and not your competitors then unfortunately you have no other option but to compete by offering lower prices than everyone else, which is rarely a viable long term strategy for a small business with limited economies of scale and scope.Try to develop your
ONLY statement — “We are the only ones that…” is an effective way to summarize your HOW to WIN work. It forces you to define precisely what you and only you provide the customers you have chosen to SERVE.
Strategic game plan
The final step is to integrate the answers to all three questions into your Strategic Game Plan statement which goes like this…“We will (HOW BIG) by focusing our scarce resources on (WHO to SERVE). We will compete by (HOW to WIN).”Here’s an example:“We will grow sales revenue by 25% over the next 36 months by serving the needs of four seasons vacationers Washington State. We will compete and win by creating personalized experience packages that incorporate the many activities that Whistler has to offer.”The traditional
floundering strategic planning process has its limitations for small business. It generally requires more time than the small business leader has to devote to the task, and it costs more than most small businesses are prepared to pay.3 questions; 3 answers that will define an effective strategy for small business. The process is proven to work because it recognizes the special challenges that small businesses face.Give it a try.Related:
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