A strategic plan is one of the basic essentials that any growing business needs. For most entrepreneurs, especially those that have the experience of working for or owning a business before or those that have just transitioned from another professional, sparing time, effort and money in developing a strategic plans may not seem so essential. But, this really may prove to be the difference between a thriving, successful business that can withstand an uncertain economic climate and one that crumbles at the first hint of trouble. Here are a few key reasons why a strategic plan is necessary for a growing business to succeed eventually.
1. It lays down an action plan
The basic benefit of a strategic plan is that it tells you what you need to do 1, 2 or 3 years into a business. Since you would have created these goals at the beginning, it helps you see just how well you have done and whether things are going as planned.
2. The allotment of budget makes managing money easy
Another crucial benefit of having a strategic plan is that it allows you to manage your business’ money better. For example, if your strategic plan requires you to upgrade office interiors by year 3, you would be able to begin allocating a budget for that by the end of year 2 and begin researching decorators etc.
3. It forces you to access progress at regular intervals
A lot of people put in a lot of time and effort into defining where they would want their business to be in 5 years’ time. However, a strategic plan basically breaks that 5 year plan down into many parts and allows you to analyze growth and access progress at more frequent intervals. Then, if your business hasn’t done well in the last say, two months of your 4th year, as you had planned, you can always determine what you are doing wrong and revise your performance accordingly.
4. It prepares you for contingencies
Your plan of business plan is undoubtedly the Plan A when you first set up shop. A strategic plan on the other hand, is essentially Plan A that has Plans B, C and D included in the footnotes! A good strategic plan prepares you for contingencies and helps you get through timed when your business may not be doing so well.