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business career entrepreneur success

Business Plan Stages

Many managers are involved in creating business plans in their organizations. A business plan outlines a set of business goals and how those goals can be achieved. Once a business plan has been created and communicated, it needs to be implemented. It also needs to be continuously reviewed and controlled to ensure it’s being carried out effectively.

The planning, implementation, and subsequent control phases of a business plan shouldn’t be regarded as separate functions that operate independently. Instead they should be integrated into the organisation’s overall activities and viewed as part of a continuous strategic process.

From Planning to Implementation to Control

The planning stage is the first part of the process. At this stage, you develop your business plan. The plan should clearly state what needs to be accomplished. It should also provide general information about how this should be done.

Implementation is the next stage of the process. At this stage, you put the plan into action. This involves devising and managing action plans and establishing accountability among employees. You also need to ensure resources are available and aligned with the plan’s goals and objectives in order to successfully realize the plan.

No matter how well a plan is constructed, it needs to be reviewed from time to time. At the third stage of the process — the control stage — you assess how effectively the plan is being implemented. This allows you to measure the performance of employees and modify and enhance your action plan if necessary.

When you establish a direct link from planning to implementation to control, you’ll be able to implement your business plan more successfully.

Implementing a Business Plan Effectively

As a manager, you’ll be able to gain real benefits by implementing your business plans successfully. For one thing, you’ll be able to introduce your strategies and ideas smoothly, causing a minimum amount of disruption to your employees. Your team can then focus on making the necessary changes and on reconciling new and emerging strategies with existing ones.

By implementing a business plan effectively, you overcome the reasons why many plans fail. Typical reasons include employee resistance due to pessimism, skepticism, or a general unwillingness to do things differently. Inadequate resources, IT constraints, and poor communication are other reasons why plans fail.

When you successfully implement an idea or strategy, it’s likely that you’ll gain credibility among your employees.

Successfully implementing a business plan may also make you feel more confident as a manager. And your organization as a whole can benefit too. Through the implementation process, employees will have acquired more knowledge and experience, meaning the company is better positioned to adapt to future changes.

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business career entrepreneur success

Selecting Initiatives that are Strategically Executable

The critical aspects of strategy

Strategy development is an essential aspect of execution. There are two aspects of the strategy that can have an effect on its execution: the kind of strategy, and how it is translated into plans.

There are four critical characteristics of a strategy that leads to successful execution:

  • planned — A realistic, workable strategy begins with good planning. Before you make any major move, evaluate the current situation and possible consequences. Poor planning can significantly affect execution. Because the goal of business strategy is always to gain competitive advantage, your strategy should be planned to gain an understanding of the industry and competitors, and to develop capabilities that increase your competitive edge.
  • integrated — Corporate and business strategies must be integrated if your strategy is to be executed well. The strategies must support each other.
  • measurable — For a business strategy to be executed well, it needs measurable objectives. Everyone involved should know what metrics will be used to measure strategic performance. You should have a plan in place that can be used to assess your progress with regard to short- and long-term goals.
  • supportable — To be successful, the business strategy must be supportable. Trying to make changes that are too big in too short a time could make demands on the organization’s skills, resources, and capabilities that can’t be supported. If you ignore these demands, you’re unlikely to be able to execute the strategy effectively.

Selecting strategic initiatives

The second step in creating strategy that executes is to develop the strategy. This involves four steps:

  • select strategic initiatives based on themes
  • assign accountability to initiatives
  • translate initiatives into strategic targets
  • allocate resources to initiatives

The first step in developing a strategy involves actually selecting strategic initiatives. It’s important to evaluate which strategies you should choose to implement, based on the existing situation in your company and the potential consequences. Poor planning can negatively affect many areas of the organization. 

Sound planning and a clear, focused strategy are essential if the company is to reach its goals. That’s where strategic initiatives come in. They’re the short-term actions that guide your company toward achieving its vision. The company screens strategic initiatives and selects them by examining whether they help the company achieve its objectives.

Selecting strategic initiatives involves five steps:

1. examine the strategic objectives that have arisen — During the defining process, you will have formulated strategic objectives in each of the four strategy map perspectives: financial, customer, internal, and learning and growth. The objectives are the continuous improvement activities that link to your strategic themes.

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business career entrepreneur success

Strengths, Weaknesses, Opportunities, Threats

A SWOT analysis is the identification of strengths, weaknesses, opportunities, and threats to your business. Strengths and weaknesses are derived from your internal analysis. Opportunities and threats become apparent during your external analysis.

  • strengths — Strengths are resources and capabilities that provide a competitive advantage. Examples may include patents on products, your brand in the market, your reputation with customers, a low-cost location, good distribution channels, or reliable infrastructure.
  • weaknesses — Weaknesses can be the absence of strengths. For instance, a weakness could be the lack of a patent, a weak brand, a poor reputation, or high operating costs. Also, something may be both a strength and weakness. For example, having a mature business with a large local presence and skilled workforce can also make you slow to adapt to the changing external environment.
  • opportunities — Opportunities are the potential for profit and future growth. Examples include any unfulfilled customer wants or needs, new technological advances, the loosening of regulation, or the removal of barriers to trade.
  • threats — Changes in the external environment can present threats. Possible threats could be a change in consumer taste away from your product or service, new substitute products on the market, new regulations that adversely affect your business, or perhaps increased barriers to trade.

A SWOT analysis should be a simple strategic review that you can do quickly. It’s an important aspect of your business plan in the context of your company’s internal and external environment. You can then present it as a key addition to your business plan.

Conducting a SWOT analysis

You begin your SWOT analysis by listing important opportunities and threats in the context of your company’s strengths and weaknesses. You should also keep in mind the strategic objectives of your business plan. 

For ease of discussion, you can then rank the factors in order of importance and assign a weight or importance score to each factor. Focus on the most relevant factors and present them neatly on a one-page chart.

To maximize competitive advantage, you must put customer needs first. You can do this by being aware of your customers’ needs when conducting a SWOT. To focus on your customer’s needs, determine the relevance of your strengths and weaknesses to meeting their needs.

A strength is only relevant if you can exploit it as an opportunity or use it to overcome potential threats. Conversely, a weakness is only relevant if it’s a threat to the success of your business.

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business career entrepreneur success

Defining an Executable Business Strategy

Define the strategy

Business strategy involves making decisions about what the company should do and how it should allocate resources. These decisions should take into account current competitive conditions and growth opportunities in the industry. Remember, good execution begins with good strategy.

The first stage in strategy formulation is to define the strategy. To develop a truly focused strategy, you must fully examine the business, its goals, and its environment. An effective and focused strategy is essential because it helps your company build a favorable competitive position. The process of defining the strategy has three steps:

  • clarify the company’s mission, vision, and values,
  • review the current situation with an emphasis on internal and external influences and the existing strategy, and
  • create strategy direction statements.

Clarify the mission, vision, and values

The first step in defining the strategy is to clarify the mission, vision, and values. These three items form the basis of the company’s purpose, actions, and aspirations. Essentially, they clarify why the company is in business. The executive team should return regularly to the mission, vision, and values statements, as they tend to remain stable over time.

The mission statement is typically a one- or two-sentence statement that explains your company’s purpose. It should also describe what your company provides to customers or clients. Finally, it should define the overall goal that employees and executives are pursuing.

The vision statement outlines the company’s mid- to long-term goals. This generally encompasses a three- to ten-year period. This statement is focused on the market and describes how the company wants to be perceived by the world. The vision statement usually contains ambitious goals and a time frame for achieving them, as well as a clear measure of success.

The values statement reflects the company’s core values. These are the ways the company defines its attitudes, character, and behavior.

Before they can define strategy, leaders and managers need to agree on the mission, values, and vision statements. The mission and values statements don’t tend to vary from year to year. The vision statement isn’t as stable, but typically remains constant during a company’s three- to five-year strategic plan.

Review the current situation

Once you’ve clarified the mission, vision, and values, it’s time to review your company’s current situation — the second step in defining the strategy. To do this, you examine three things:

  • external influences — External influences are the macro- and industry-level trends that have an impact on the company’s strategy and operations. You need to assess what’s going on in the outside world. This assessment includes the state of the economy, industry growth, prices, regulations, and a general idea of what consumers expect from the company. The external analysis isn’t complete without an assessment of competitors as well
  • internal influences — When you examine internal influences, you consider your own company’s performance and capabilities. To do this, you might use a balanced scorecard or rely on financial information to do the assessment. Another common method for assessing internal influences is to identify the processes required to deliver products and services to customers. The company’s goal should be to identify the processes that it can do better or differently to differentiate itself from competitors.
  • the existing strategy — Examining the existing strategy means identifying the company’s existing strengths and weaknesses. Then you summarize the conditions that aren’t currently being addressed. These conditions must be addressed when developing the strategy. Figuring out what a company’s strengths and weaknesses are can give it a clear indication of its current situation. A thorough examination of external and internal influences can uncover a lot of information — categorizing it as strengths or weaknesses can help the management team identify the key issues that need to be addressed.

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